A few weeks ago, this author was asked to participate on a panel discussing the future of family law nearly forty years after the federal government passed the no-fault and equitable distribution systems and introduced policy-based child support. One of the concerns I raised with the State Bar Association’s Family Law Division was that adjudication of support cases took too long and cost too much to administer through a traditional court process. The immediate poster child for my argument at the time was Hanrahan v. Bakker, a high-income case that took years to solve. Meanwhile, the husband’s income went from $1 million to $15 million a year.
Well, last week a new poster child emerged with some very ugly facts. morgan v Morgan is a decade-long odyssey that began in neighboring Maryland and then meandered to southwestern Pennsylvania. After nearly 20 years of marriage, the parties reached an agreement in 2003 in which the husband agreed to pay $60,000 in child support annually through 2007. From that point on, the alimony would be changed. His separation income was listed as $144,000. As the date of the change approached, the husband filed the decree and a request for change in Franklin County, asking to have the alimony reduced to $1,000. Ex-wife responded with a request for an increase. The Pennsylvania Court heard the case and granted the $1,000 reduction. In late 2007, the woman appealed and secured pre-trial detention, insisting on a record showing a change in circumstances and an analysis of child support factors (curiously) under the Pennsylvania Child Support Act. Remember, this is a Maryland divorce.
The court reopened the case and held a detention-based hearing, again ruling in December 2011 that $1,000 a month was the figure supported by the facts. That decision was also appealed, but while the appeal was pending, the ex-wife filed requests for relief with the Court of Appeals based on allegations that her ex-husband filed false tax returns and other income information while in custody in 2011. The Superior Court denied that application and affirmed the judgment of the second trial court.
The woman then filed a new amendment in 2012 alleging the fraud, which she brought to the attention of the Court of Appeals on appeal. At that hearing, the husband explained that his income was $415,000 in 2007, when he requested a change, and has gone from a low of $340,000 to a high of $663,000 in 2015 in recent years swayed. The trial court found his misrepresentation of income “despicable” but appears to have ruled the matter was final and not subject to rectification of the 2012 petition. That ruling came in 2016. The woman appealed a third time, which apparently was the charm, based on what we saw published on July 20 in a published panel decision by Judge Dubow.
Two issues play a major role here. The first and most obvious is modification. The second was the wife’s request for attorneys’ fees. The husband committed to the hourly rate of the wife’s attorney and does not appear to have contested the amounts. However, the trial court awarded only 75% of the amount claimed and barred all services rendered before the fraudulent evidence was brought to the attention of the appeals court.
On the first point, the Dubow Report clearly states that a motion to amend alimony is an appeal against the court’s equitable powers and that a party which produces false testimony and corresponding false documentation is not entitled to any form of remedy. Accordingly, it rejects the husband’s request for amendment (circa 2007) from the outset. With respect to attorneys’ fees, the court noted that while the courts have jurisdiction to determine the reasonableness of fees when challenged, that was not the case here. Furthermore, as in the Cancer vs. Cancer case, this litigation was instituted on the basis of false information and merited an award under 42 Pa.CS 2503. The Supreme Court remanded the case to reinstate the $5,000 monthly award and the Amend Awarded Attorney’s Fee 100% of Agreed Amounts.
Impressive. One cannot question the justice that seems to be being practiced here. It’s every lawyer’s bad dream. False testimony believed in the first instance and upheld by the trial court even after being exposed in custody. Worse, the complainant appears to understand the lie and is trying to get the Court of Appeal to stop the train, only to see the request to rectify or reopen the record denied and the 2007 verdict upheld. So justice was done and two judges stated in a unanimous statement that the case was open to criminal and disciplinary proceedings. Did we mention Mr. Morgan is a lawyer?
However, the report opens doors just as much as it seems to close them. First, this is a modification of a “foreign” (ie, Maryland) support order. From a legal point of view, shouldn’t this have been decided using the Maryland Child Support Act? We can all agree that Maryland is not a state where false evidence is admitted and upheld, but the Superior Court’s first remand calls for a change of circumstances and a review of Pennsylvania’s alimony factors. Second, and related, what became of the wife’s request for a raise? Husband’s income has doubled and tripled from 2007 to 2015. This is certainly an argument for an increase under Maryland law regarding amendments. The warrant states that the $5,000 bounty should be reinstated, but does not address the 2012 request for an increase.
Finally, there is the question of finality. That may have been the point the trial judge was looking at when he admitted in 2011 that the husband’s contact was despicable and the income grossly underrepresented, but he stuck by his $1,000 decision. Terrible. Not correct. But suppose the woman discovers the fraud five years after the alimony ends. Is there a statutory or reasonable statute of limitations or can these claims be enforced if fraud is discovered and/or alleged? No one likes the idea of the wrongdoer escaping unscathed. Suppose the defendant’s attorney in a personal injury case sees the plaintiff playing tennis 3 months after the plaintiff received a million dollar verdict based on his statement of irreversible spinal cord injury. Can the accused request a retrial? Would it make a difference if the plaintiff had been in court regularly in the months leading up to the trial? Do Victims of Family Law Fraud Have More Durable Claims Than Victims of Civil Fraud? Or, in short, is final always final when it comes to cheating?
This essay began with a different topic. So I should circle back and close this point. This is an 11-year alimony change process. In the Hanrahan v. Bakker case, the motion to amend child support was filed in December 2013. The Supreme Court ruled in June 2018, with a remittance to the lower court, to create a record of expenses related to income in 2012. This record must include at least six years of income and expenses. Folks, unlike the distribution of assets, these alimony and alimony cases involve the funds that people live on on a daily basis. We need to look for more efficient means of getting an outcome at a time when income is less regular and more erratic.
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