The mere mention or even the thought of divorce often sets off a race to the bank with each spouse trying to get hold of assets ahead of the other -- and before either one appears before a judge.
But effective this month, as soon as an action for divorce is commenced, the parties cannot take any steps to change their financial situation. Under a bill passed by the state legislature this year, the minute a husband or wife sues for divorce by filing a summons in New York State Supreme Court, he or she is barred from altering the economic status quo of the marriage. As soon as the other spouse receives that summons and a form order, it is too late for him or her to move money or other property to shield it from claims by the plaintiff.
Until the recent enactment of the new statute and implementing court rule, the less wealthy spouse, usually the wife, had to seek an injunction from a state Supreme Court justice, to bar the richer partner from removal, sale or other disposition of assets. This meant she had to seek a court order, incurring legal fees and losing time, before getting any financial protection. During that time, stocks, bonds and cash could vanish.
By maintaining the status quo until the divorce case is actually heard by a judge, and evidence of entitlement and equity can be presented, the new statute avoids costly motions at the beginning of the case. The race to the courthouse, like the race to the bank, may no longer be an emergency.
The change does not affect applications for spousal support, child support or eventual equitable distribution of marital property; it simply means that there is an automatic stay to prevent hiding or liquidation of assets.
As the state Judicial Committee on Women in the Courts explains it, "Both parties are prohibited from selling property, mortgaging real estate, depleting bank accounts, invading pension funds, running up credit card debt, or removing a spouse or child from life insurance and medical plans."
The Administrative Order of the Chief Administrative Judge of the Courts, which implemented the change in the law, spelled it out: "Neither party shall sell, transfer, encumber, conceal, assign, remove or in any dispose of, without the consent of the other party in writing, or by order of the court, any property (including, but not limited to, real estate, personal property, cash accounts, stocks, mutual funds, bank accounts, cars and boats) individually or jointly held by the parties, except in the usual course of business, for customary and usual household expenses or for reasonable attorney's fees in connection with this action."
The statute covers retirement accounts, pension accounts, annuities and insurance. However, there is an exception: All of this can be overridden with the consent of the other party in writing, or by order of the court.
Jacqueline W. Silbermann, former administrative judge for matrimonial matters in New York State, had been attempting to implement this change since 1997 when she observed it working in Connecticut. Since approximately 2000, courts in the Buffalo area have adopted a similar rule, but statewide acceptance required legislative action. That did not happen until now.
"The change puts the burden on the person who wants to change the status quo, rather than the one seeking to keep things in place, the one saying 'let's not move bank accounts, insurance or anything yet,'" said Silbermann "This requires nothing," she adds, "because if you want to change things, you can go to court, and if necessary a judge can decide." Not only is the new way more efficient, she emphasized, but it will eliminate the danger of one angry spouse removing the other from insurance, for example.
For judges it will be a relief to have litigants' assets preserved without court intervention and court orders, especially since most matrimonial judges in New York City have hundreds of cases on their calendars. Ultimately the judges still will order the division of property, but it need not be at the start of the case.
Husbands and wives who might some day divorce are not yet aware of the new law on assets and probably don't realize that the change in court procedures could save them money on legal fees. This could please the less affluent spouse in particular.
At the same time, "monied" spouses, if they are the defendants, may be surprised when they learn that not only are they getting divorced but also that they won't be able to move or liquidate their accounts until later in the proceedings. Documentary proof will establish any withdrawals or transfers made after the date of the serving of a summons. Of course, the new law and rule offer the non-monied spouse, the one who may be seeking equitable distribution, a degree of security from knowing that marital funds cannot be depleted while the couple awaits a divorce settlement.
Lawyers may be glad that their clients have some certainty and that they don't have to rush into litigation in Supreme Court (not Family Court) to obtain an injunction. In the past, that required the person seeking it to establish that there was the risk that marital assets would be disposed of or minimized to the detriment of the party seeking equitable distribution.
Bringing such motions has been costly, particularly with legal fees averaging $250 to $800 an hour. But lawyers have not publicly objected to the loss of legal fees they would otherwise bill for.
Still, most divorces do not come by surprise. It may well be that individuals who expect to divorce have already consulted lawyers and accountants and have moved money or run up credit card bills in advance of the critical date. There is probably no way to keep all the acrimony over finances out of divorce.
Emily Jane Goodman is a New York State Supreme Court Justice
Refusing to hire, discharging or in any other way discriminating against a victim of domestic violence in the workplace now violates New York State law. Being a victim of domestic violence or being perceived as a victim of domestic violence has joined age, race, creed, color, national original, sexual orientation, military status, disability, genetic characteristics and marital status as a protected classification, Gov. David Paterson proclaimed upon signing the law.
The purpose of the new law, which Paterson signed in July making it effective immediately, is to help protect domestic violence victims in hiring and employment practices. According to the governor, this will help give people "the ability to deal with the circumstances of their lives, and to achieve financial independence from their abuser and participate more fully in the economy."
The victim and perpetrator may be married, living together or dating; they may be in a traditional or non-tradition family; they may be gay or straight.
However, the law, an amendment to Executive Law Section 292, applies to employment only -- not, for example, housing or education.
Advocates say that many women remain in abusive relationships because they lack financial independence for themselves and their children. Becoming financially independent -- and able to leave the abuser -- often requires that the victim find and keep a job.
Being in an abusive relationship, they say, can make employment difficult. For example, a victim of domestic violence may need time away from work to confer with an attorney or domestic violence counselor, appear in court, seek medical attention, arrange for alternative housing or recuperate from injuries. Embarrassment or fear of losing the job may make the victim reluctant to inform her employer of the circumstances of her life. A victim may need time off or flexible hours as a protective measure. Employers may fear that a violent spouse or partner may show up at the workplace and cause disruption, fear and interfere with business.
By banning discrimination on the job against victims of domestic violence, this measure intends to help ensure the economic viability, as well as the physical safety, of victims.
"Assisting victims of domestic violence in keeping and maintaining employment provides a crucial pathway out of abusive situations. Protecting such victims against invidious discrimination in the workplace is an important step toward that goal," Paterson said.
The New York City Council had already amended the Administrative Code section 8-107.1 to make it unlawful for an employer in the city "to refuse to hire [or to] discharge from employment or discriminate against an individual in compensation or other employment practices because of such individual's actual or perceived status as victims of domestic violence." However, the city law does not apply to state agencies or to a city resident working or seeking work elsewhere in the state.
There are few reported cases of victims of domestic violence losing their jobs for reason linked to their abuse. This could be because of confidentiality clauses in settlement agreements, because both the city and state statues are unfamiliar to the public, and of course, because of fear. Spokespeople and lawyers for major domestic violence organizations agreed, however, that the problem of discrimination exists.
They cited one example, wrapped in layers of confidentiality, that took place at a 2006 raucous Manhattan Christmas party given by a major corporation, a leader in its industry. A high-level employee quarreled with her boyfriend who soon left. She then told a staff member that the boyfriend sometimes was violent at home, although nothing of the kind had taken place at the party, which was held in a public place.
By the next work day, gossip and gross exaggerations had spread, and the woman was suspended and then fired. Prior to commencing a lawsuit under city law for unlawful termination as a victim of domestic violence, the woman and her lawyer worked out a settlement with the company. As part of an out-of-court settlement, the company agreed not to interfere with her future career, and she agreed to confidentiality as to the terms.
In Reynolds v NYC Department of Corrections, the city terminated a probationary worker after investigators went to her address to verify that she was out sick. She was not found at the address because she and her children were living in a homeless shelter due to domestic violence. In a 2004 decision, Justice Louis York concluded that she had been discriminated against under city law because of her status as a victim of violence in the home and was entitled to reinstatement and back pay.
Barbara Kryszko, director of Sanctuary for Families Brooklyn Family Justice Center Legal Project, represents domestic violence victims in their Family Court cases and sees the connection between her clients' home and work situations. She described one client who lost her job due to her partner's incessant calls to her office, harassing her and other employees. While she was given another reason for her dismissal, coworkers told her she was let go because of her partner's conduct.
Despite that, Kryszko said, the company may be able to document that she was unable to sperform her duties. "In all discrimination cases, the problem is proving that the firing was in fact illegal discrimination, rather than some other pretextual reason provided by the employer," Kryszko said. "You must consider how much of an accomodation an employer can reasonably be expected to to make. " Kryszko said that, despite protective legislation, proving discrimination "is an uphill battle for the victim."
Prior to her election in 2000, State Assemblymember Amy Paulin of Westchester, the bill's primary sponsor, was executive director of My Sisters' Place, a Westchester center for battered women. In her work, she found that the typical abuse victim might not be able to get or hold a job or become economically independent or free of her batterer. This may cause her to return to the violent situation she was trying to escape.
The problem of domestic violence, Paulin said, is "so serious, so prevalent, that we need to engage everyone or we are never going to solve it. Employers are such a significant part of our community that this is taking one small step toward eradicating it." Although the situation is "challenging for employers," Paulin said the business community took no position for or against the legislation.
She sees the legislation, which she had introduced three times before it was enacted, as sending "a message that employers should be more sensitive to victims of domestic violence and work with them and help them get out of a bad situation."
"Because a victim is unable to leave her abuser," Paulin said, "doesn't mean she won't have the strength to do other things to protect herself," if there are empowering tools available.
Emily Jane Goodman is a New York State Supreme Court Justice