The terms contested and uncontested may be confusing to some. Just because both parties to a marriage want a divorce, does not make the divorce uncontested. A contested divorce is one in which the client and his or her spouse can not agree upon issues ancillary to the dissolution of the marriage. These issues can include child custody arrangements, property division, spousal and child support obligations, and the division of marital debts. If the parties can not reach an agreement on these issues, the courts will have to intervene. Often to the detriment of one party.

An uncontested divorce is one in which the parties have reached a settlement agreement regarding the issues accompanying a divorce. In my experience, uncontested divorces are more regularly achieved by younger couples with no children or substantial assets. Reasonably working though the previously mentioned issues with your spouse is the best option, and can set the stage for cooperation in the future if one party later seeks to modify the agreement.

Regardless of whether or not a divorce is contested or uncontested, it is extremely important to hire an attorney to represent you. This may seem self serving, but it is essential you protect your rights not only now, but also in the future. Certain divorce agreement language may bar the spousal support paying party from reducing their payment amount in the future, even if the payor is able to satisfy the legal standard of a bona fide involuntary change in material circumstance.

Ross Charles Allen

Yes, it is illegal to wear headphones while driving, or biking, in Virginia

A disturbingly dangerous trend has developed among the tech savvy youth in Richmond, Virginia. This trend is the operation of a motor vehicle or bicycle while using earphones. After reading, and hearing, much erroneous information on the topic I wish to clear the air once and for all. Yes. It is illegal.

Ill-conceived myths include, and are by no means limited to, ear “buds” are not earphones, you can listen to them if they merely cover your ear but don’t go inside, and you can wear them if you are riding a bicycle. These ideas are all false and may lead to a ticket, or worse. Virginia Code Annotated § 46.2-1078 is titled: “Unlawful to operate a motor vehicle, bicycle, electric personal assisted mobility device, electric power-assisted bicycle, or moped while using earphones.” The title of the statute says it all, but in case you were unclear as to what constitutes earphones, the Virginia General Assembly covered that as well. Earphones are “any device worn on or in both ears that converts electrical energy to sound waves or which impairs or hinders the person’s ability to hear . . .” Va. Code Ann. § 46.2-1078. Virginia makes no distinction between earphones, ear buds, or headsets. If it has the ability to hinder your hearing, and is not within an exception, it is illegal to wear while operating a motor vehicle.

Presumably, the reasoning behind the law is to prevent a driver from becoming distracted, or to prevent the driver from being unable to hear approaching emergency vehicles. Distracted driving accounted for 20% of all crashes involving an injury and caused over 5,000 deaths in 2009. http://www.distraction.gov/stats-and-facts/index.html. With such a high amount of pedestrian foot traffic in the city of Richmond it is important to limit distractions while driving. This includes cognitive distractions such as headphones.

The penalty for violating the statute barring the use of headphones while operating a motor vehicle is not steep. It is a $25.00 fine with $51.00 in court costs. Va. Supreme ct. rule 3B:2. However, this type of distracted driving could have consequences far beyond monetary forfeiture. See http://www.dailycamera.com/ci_13096706. The bottom line is that operating a motor vehicle while wearing headphones is against the law for a very good reason: to protect others on the road, and ensure the efficient delivery of emergency services.

Ross Charles Allen

Virginia Divorce From “Bed and Board”

There are two distinct types of divorce available for plaintiffs in Virginia. These types are a divorce from “bed and board,” or a divorce a mensa et thoro, and a “final divorce,” or a divorce a vinculo matrimonii. Va. Code § 20-91 and 95. Each type of divorce has separate requirements, and distinct advantages and disadvantages. Id.

A divorce from bed and board may only be granted if the plaintiff asserts there has been “cruelty, reasonable apprehension of bodily hurt, [or] willful desertion or abandonment.” Va. Code § 20-95. Although a plaintiff can commence an action for a divorce from bed and board upon the happening of one of the previously mentioned grounds, a final divorce can not be granted until one year from the date the cause of action complained of took place if there are minor children involved, or six months after if there are no minor children involved. Va. Code § 20-91(A)(6). During this separation period, the parties must live separate and apart. Va. Code § 20-121.

It is long held judicial principle that cruelty and reasonable apprehension of bodily hurt are extremely similar, and that evidence of one may prove the other. Latham v. Latham, 71 Va. 307 (Va. 1878). What constitutes cruelty is defined broadly so as to encompass physical, verbal, and mental abuse, continuous and repetitive acts of maltreatment, or even neglect. Humphreys v. Humphreys, 139 Va. 146 (Va. 1924); Bennett v. Bennett, 179 Va. 239 (Va. 1942);  Sollie v. Sollie, 202 Va. 855 (Va. 1961).

To establish desertion and abandonment as grounds for divorce from bed and board a two part test must be satisfied. First, one party must cease cohabitation with the other party, and second, the party ceasing cohabitation must have the intent to do so permanently. Smith v. Smith, 202 Va. 104 (Va. 1960). Virginia statute does not define a time period necessary to establish desertion, and every case is evaluated on its own unique set of facts and circumstances. However, once the desertion and abandonment has been proven, it is presumed to continue until there is an affirmative action by the abandoning party sufficient to establish an intent to reconcile. Id. After the period of separation imposed by Va. Code § 20-91(A)(6) is met, the divorce from bed and board can be merged into a full final divorce decree. Va. Code § 20-121. Until the divorce from bed and board is merged into a full final divorce decree, the parties remain spouses. Id.

Ross Charles Allen

In Virginia, a Chapter 13 bankruptcy allows a homeowner who has two mortgages to strip the second mortgage if the principal balance of the first mortgage is greater than the fair market value of the home.  For example, if your home’s fair market value is $200,000 and you owe $205,000 on your first mortgage and $50,000 on your second mortgage, in a Chapter 13 you could strip the second mortgage.

This means the second mortgage becomes classified as an unsecured creditor and will receive the same payout as all your other unsecured creditors, usually much less than 100%.  At the end of the Chapter 13 plan, the bankruptcy court will enter an order discharging the debtor from their debts, including the second mortgage.   Thus upon successful completion of the plan, the debtor will no longer owe the second mortgage company any money, nor will the second mortgage company have any rights with regard to the property.

The theory behind this law is that because there is no equity in the property after the first mortgage is paid, the second mortgage company has no real security in the property to which a mortgage would attach; therefore, they are unsecured and should be treated as such in a Chapter 13 bankruptcy.

Currently not all circuits approve of lien stripping.  Recently the 4th Circuit Court of Appeals affirmed a Bankruptcy Court’s ruling from the Eastern District of Virginia, approving lien stripping, so this practice is alive and well in Virginia.  Consult with a local bankruptcy attorney to see if this practice is allowable in your circuit.

But, if you borrow money to get an education and cannot afford the minimum payments after several years of underemployment or unemployment, that’s another matter according to Congress.

The federal bankruptcy code states that debtors may discharge a student loan only if repaying the loan would impose “undue hardship” upon them and their dependents.  This applies to all student loans, regardless of whether the loans were obtained through government-sponsored lenders or private lenders. Most bankruptcy courts interpret “undue hardship” to mean an inability to repay the loan and maintain a minimal standard of living.  However, your traditional notion of a minimal standard of living can differ greatly from (i.e. greatly exceed) what a judge may have in mind.  Meeting this burdensome threshold also usually requires demonstration that the conditions imposing the hardship are unlikely to relent over time.   Consequently, student loans rarely are discharged via bankruptcy.

All of this paints a bleak picture for our college graduates struggling with student loans, and I think it will only become more problematic in the years to come.

College seniors who graduated in 2009 carried an average of $24,000 in debt from student loans.  That figure represents a 6 % increase over 2008 and continues a four-year trend of rising debt from student loans among college graduates, according to a recent report by The Project on Student Debt. In addition to the rising cost of education and the rising average student loan debt, unemployment rates for college graduates spiked from 5.8% to 8.7% in 2009, marking the highest annual college graduate unemployment rate on record and making it increasingly difficult for college graduates to pay their student loans back.

With student loan debt growing nationwide at a rate of $2,853.88 per second, it will surpass $1 trillion in 2012.  Will student loan debt be the next subprime mortgage crisis?

Legislation proposed in the 111th Congress would have altered the dischargeabillity of student loans, but there is no guarantee that the newly-installed 112th Congress will contemplate such legislation in the future.

So, if you are experiencing financial hardship due to your student loans, speak to an experienced bankruptcy attorney and discover your options.  If you don’t meet the “undue hardship” test, bankruptcy could still be useful by eliminating other debt and allowing you to redirect disposable income to those pesky student loans.

I had a consultation with a client recently to discuss refiling his Chapter 13.  The individual was in a Chapter 13 for one year before losing his job and falling behind on his Chapter 13 Plan Payments.  After he fell behind on his plan payments the Chapter 13 Trustee filed a Motion to Dismiss for Failure to Make Plan Payments.  The Trustee was successful on his motion and the case was dismissed. The individual has now obtained a new job, but has also received a Notice of Foreclosure from his mortgage company. When he filed his Chapter 13 case, he was several months behind on his mortgage payment and those arrearages were to be paid out of his Chapter 13 plan. The mortgage company had not received all of the arrearage before his case was dismissed, so they now want to foreclose.

Here are my thoughts to people in a similar situation:

A debtor can refile a Chapter 13 case immediately after his first case is dismissed; however, if the debtor’s second case is filed within twelve months of his first case pending, he may not get the same protection afforded him in his first case under the Automatic Stay.  Usually, when  a person files bankruptcy they are under the protection of the Automatic Stay, which means their creditors cannot take any collection efforts against them or even contact them.

This protection generally lasts for the duration of their case.  However, when a debtor has had two case pending within twelve months, then the Automatic Stay is only effective for thirty days.

To extend this protection the debtor must file a Motion to Extend the Automatic Stay and convince the judge to do so.  Furthermore, the debtor must file the motion, request a hearing, attend the hearing and have the motion granted all within the first thirty days of his second case.

In order to succeed in his Motion to Extend the Automatic Stay the debtor must demonstrate that his second case was filed in good faith and not merely to hinder or delay his creditors for their collection efforts.  Different Judges vary on what they require to prove this good faith and to what extent they scrutinize these motions.  That is why it is important to have an attorney familiar with your court’s local rules and practices.

If the debtor is not successful on his motion or if his attorney does not timely file the motion, the mortgage company would be permitted to foreclose on his property even though he is presently in a Chapter 13.

This topic is also important for individuals currently considering dismissing their case.  If you are behind on your plan payments and are considering dismissing your case and refiling a new case, you need to consider the implications listed above and what your chances are of being successful on a Motion to Extend the Automatic Stay.

1. You need to stop a foreclosure, respossession or garnishment. When you file bankruptcy your creditors must immediately stop any collection efforts–foreclosures, garnishments, respossessions, civil suits, and harrassing phone calls. This also applies to a Chapter 7 bankrutpcy, but it is only a temporary fix to stop a foreclosure or reposssession unless you can get caught up on the payments quickly. In a Chapter 13, you can repay any missed payments on your mortgage and/or car payments over time and possibly at a lower interest rate than the original contract rate. As long as your Chapter 13 plan proposes to pay these missed payments back, your creditors cannot take any action against you or your property.

2. You have two mortgages on your home and the balance of your first mortgage is greater than the fair market value of your home. If your second mortgage is wholly unsecured–the fair market value is less than the balance of your first mortgage–then you can strip that second mortgage in a Chapter 13. That second mortgage would become an unsecured creditor and receive the same percentage as all your other unsecured creditors, usually less than 100%. And, once you complete your plan–in three to five years–you will no longer have a second mortgage!

3. You are not eligible to file a Chapter 7, but need to avail yourself of bankruptcy protection. If you filed a Chapter 7 in the past eight years you are not eligible for a Chapter 7 discharge. You are also not eligible for a Chapter 7 if you are above the median income for your state. Check this site for your state’s median income based on family size: http://www.justice.gov/ust/eo/bapcpa/20101101/bci_data/median_income_table.htm

4. You have a tax obligation, student loan, or other debt that cannot be discharged in a Chapter 7. You can include these debts in a Chapter 13 plan and pay them back over time, usually with little to no interest.

5. You have non-exempt property you want to keep. When you file a Chapter 7 bankruptcy the trustee can take your property, sell it, and use the proceeds to pay your creditors unless the property is exempt according to your state’s exemptions laws. Exemption laws allow you to protect certain property from liquidation in a Chapter 7. A Chapter 13 allows you to keep property that would otherwise be unexempt in a Chapter 7.

6. You have a co-debtor on a personal loan. If you file a Chapter 7 bankruptcy, your co-debtor will still be on the hook — and your creditor will undoubtedly go after the co-debtor for payment. If you file for Chapter 13 bankruptcy, the creditor will leave your codebtor alone, as long as you keep up with your bankruptcy plan payments.

If you are struggling with debt, but aren’t sure whether a Chapter 7 or Chapter 13 is the best option for you, we’d be happy to speak with you and give you legal advice. Just email me at info@smithwellspc.com or call 804-794-8070.

Located in Midlothian, Virginia across
from Chesterfield Towne Center

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