School District Designation and School Choice: Decision-Making Deadlock
One of the biggest battles in family court, aside from time sharing is school district designation and/or school choice for the child. In Florida, when a parenting plan gives parents joint parental responsibility, one category of major decisions co-parents must make together is educational decisions. Both parents must agree on the child’s school district designation, otherwise the court must decide the designation based on the child’s best interests. School district designation refers to which parent’s address will be defined in the parenting plan as determining the child’s default zoned public school. School choice refers to alternative school enrollment options such as magnet schools, private schools, charters or open enrollment.
Once it is established legally, which parent’s address will be used for school zone designation, if that parent moves to a new neighborhood, the child is not automatically enrolled in the new school district. The previously designated school remains the official designation unless both parents agree to the new school, or the judge approves a change in the designation. Under Florida Statute §61.13, when parents have joint parental responsibility, neither parent can unilaterally change a child’s school and doing so when joint parental responsibility has been legally established can be grounds for contempt.
If parents do not desire to have their child attend the zoned public school, they may want to pursue Controlled Open Enrollment to apply for a school outside of their district. Controlled Open Enrollment required applying in a timely manner to the charter school, specialized program, magnet school or a neighboring district. When parents have joint parental responsibility they are required to both consent to applying to and accepting a school choice transfer.
What happens when the parents cannot agree on the school designation or school choice? The first question is whether the parenting plan already contains a provision for what happens if parents cannot agree on school choice. Some parenting plans have a “tie breaker” clause which would designate one parent with the final decision-making authority to make educational decisions when the co-parents cannot agree. If there is no tie breaker provision in place and the co-parents cannot agree on the school then the court can make the decision on which parent to designate as the ultimate decision maker for education purposes. In making this decision, the court will consider the child’s best interests, the quality of the available schools and proximity to the parent’s homes. One very important distinction to make is that the court considers the best interests of the child; the convenience of the parent is not the court’s primary concern.
Factors the court may consider include the child’s individual learning needs, the preference for keeping children in a school they are already established with and familiar with, which parent can provide a better quality of school, transportation logisitics (such as whether the school is within one or both parent’s zone for school bus transportation or not), and whether the school offers programs tailored to any particular needs of the child (such as an IEP program or IB program). If one parent wants the child to attend their zoned school and the other parent wants to apply for school choice, the analysis is similar, however the court will consider which choice serves the child’s best interests and will consider factors such as commute times, proximity to the time sharing schedule, and quality of the school choice school versus the zoned school.
Lately, more and more parent’s are considering homeschooling as another possible option for school choice. When parent’s cannot agree on whether a child should be home schooled, the court will apply the same analysis, considering the best interests of the child. Homeschooling disputes can be particularly contentious when one parent will serve as the sole educator. A large part of the court’s consideration of the child’s best interests in determining whether ultimate educational decision-making should be awarded to the parent seeking to homeschool, is the quality of the home education. The parent must show that the state’s home education laws have been met and that the education being provided is of sufficient quality.
Co-Parents are strongly encouraged to try to resolve school designation and school choice issues where possible, before seeking court intervention. If you are facing a deadlock in education decision-making with your co-parent, contact Cody Law, to discuss all of the nuances to this issue and explore possible options to resolve the matter.
Divorce and Equitable Distribution of a Corporation
When spouses divorce, marital assets and debts are divided equitably. Typically these marital assets include real property, bank accounts, retirement accounts or personal property. But what happens when spouses own a corporate business? The company and its assets are subject to equitable distribution just like any other type of marital asset under Florida Statutes § 61.075.
The first step is to determine whether the corporation is a marital asset. Absent a prenuptial or post-nuptial agreement stating otherwise the general rule is as follows: If the business was acquired or created during the marriage, then typically it is considered a marital asset subject to equitable division. If the business was acquired or created prior to the marriage date, then typically only the increase in value of the business caused by marital labor or marital funds during the marriage will be subject to equitable division.
Typically the court will determine the company’s fair market value and award the company to one spouse, balancing the division in the equitable distribution of other marital assets. When spouses own interest in the business together, the court will not order them to continue to operate the business post-divorce unless both spouses agree.
Corporation as a Party to the Divorce
A critical consideration to make in a divorce involving a corporation is whether the corporation itself should be joined as a third-party defendant to the dissolution. The decision regarding whether to add a business as a third-party will depend on the type of business entity at issue and the spouse’s claim against the business entity. If a spouse is seeking equitable distribution of property or real property owned by a corporation, then joinder of the corporation is imperative as the family court does not have jurisdiction to adjudicate the property rights of non-parties. See Ray v. Ray, 624 So. 2d 1148 (Fla. 1st DCA 1993).
Adding the corporation as a third-party to the divorce allows the court to have jurisdiction over the corporate entity and to issue orders regarding corporate assets. This can enable the court to compel discovery of the company’s financial records and enforce transfer of shares. Bear in mind that a business can be equitably divided without the necessity of adding the corporation as a party, however if the corporation is not added as a party to the action, the family court will not have jurisdiction to order that corporate assets be transferred as part of the equitable distribution. The corporation should be joined as a party in scenarios where both spouses have access to corporate books, checkbooks, bills and when personal expenses are paid by the corporation.
If the decision is made to add a corporation as a third-party defendant in a dissolution, the spouse joining the corporation must ensure proper service of process on the entity and that there is a basis for personal jurisdiction over the entity. If the business is a foreign entity, the Florida long-arm statute must be satisfied.
Joining a corporation as a party may not be necessary when a party is not requesting a claim against the corporate entity or an unequal distribution in any of the corporation’s property. If the corporation is not added as a party, the court still has the power to prevent the disposal of corporate assets or stock to a third party.
Valuation of the Business
If both spouses work for the business, the contribution of their labor, time and skills and the appreciation of the business value during the marriage makes it highly likely that the corporation will be considered a marital asset.
When one spouse holds a smaller percentage of corporate shares or membership units in the business, Florida courts primary focus is still on the marital nature of the asset rather than the legal ownership structure. The amount of units or shares does not automatically dictate how the value of the asset is divided. The spouse owning the majority of the shares or units may however retain the operational control of the business during the divorce process, however the minority owner still has legal rights to prevent the majority owner from hiding assets and to inspect corporate books, tax returns, and financial registries.
A final note regarding valuation of a business in a divorce is that Florida courts must be careful when balancing the business value and awarding alimony. If the corporation’s income is used to calculate the value of the business (which is then divided), that same income stream cannot be fully counted a second time in calculating alimony. A forensic accountant may be required to separate the business’s true asset value from the personal income it generates for each spouse.
If you and your spouse are facing divorce and one or both or you own a business, you should consult with an experienced Florida family law attorney, to determine how best to handle joinder and valuation of a business as a marital asset. Contact Cody Law to discuss this or any other Florida family law needs.
You’ve Heard of a Prenup, But What is a Postnup?
Many people are familiar with prenuptial agreements, as an agreement entered prior to marriage, designed to protect spouses in the event of a divorce. But what exactly is a postnuptial agreement? The short definition of a postnuptial agreement is a written agreement entered into by spouses after a marriage, defining the division of assets, debts and spousal support in the event of death or dissolution. Essentially it functions just like a prenuptial agreement, but is entered into after marriage. A postnuptial agreement can be entered into anywhere from the day after the marriage to many years down the road.
One essential difference between a prenuptial agreement and a postnuptial agreement is that postnuptial agreements are more heavily scrutinized by the courts for fairness, due to the confidential relationship between spouses. In order to enter a valid postnuptial agreement several requirements must be met:
Written Agreement: The agreement must be written and signed by both spouses.
Voluntarily Signed: The agreement must be entered into freely, without fraud, duress, or coercion.
Full and Fair Financial Disclosure: Both spouses must provide a complete disclosure of all assets, liabilities and income to each other.
Fairness: The agreement must not be “unconscionable”. Florida courts can invalidate an agreement if it is deemed unreasonable or unfair to one spouse.
A postnuptial agreement can extremely beneficial in creating stability and comfort in a marriage, particularly if there have been changed financial circumstances. It can set expectations and help spouses feel more at ease by having honest conversations and working through issues that may cause uncertainty and tension. In some instances a post-nuptial agreement may adequately address marital concerns spouses are facing in order to avoid a divorce.
What can and can’t be included in a postnuptial agreement?
A postnup can help spouses protect premarital assets, to prevent them from becoming marital property. It can address existing debt and establish how alimony will be handled in the event of a divorce. Postnuptial agreements can be particularly helpful if one spouse owns a business and has concerns over keeping the business separate property in the event of a divorce. Both prenuptial and postnuptial agreements can address how future assets will be treated, including assets that increase in value during a marriage.
Florida law does not permit non-financial matters to be included in a postnup. These prohibitions include child support, time sharing, and parental responsibility, which will always be determined based on the best interests of the child.
What information will be needed to get started?
The basic information needed in order to begin the process of formulating a prenuptial or post nuptial agreement is as follows:
A list of all assets (including any real estate, savings, checking and retirement accounts)
A list of all debts (mortgages, loans, credit cards, and business debts)
Most recent account statements
Information regarding income and expenses.
The most important consideration, especially with a postnuptial agreement, is each spouse making a full and fair disclosure to the other. You should consult with an attorney to discuss whether a postnuptial agreement will be beneficial in your unique situation and how the process will work from consultation to signing. Contact Cody Law if you’s like to discuss your options and explore the benefits of a postnuptial or prenuptial agreement.