Wednesday, April 29, 2009

Budget means a rise in litigation, says Hammonds

Apr 28 2009 by Tom Scotney, Birmingham Post

The bleak picture of the financial year ahead painted by the Budget will lead to a dramatic increase in litigation, lawyers from Hammonds have claimed.

The chancellor has said that the next financial year will be the worst in terms of economic performance since the Second World War. And as the financial pressure increases, businesses will want to recoup and prevent losses as quickly as possible, which in turn will lead to an increase in disputes.

But the firm said taking a matter to court is not always the best option for trying to resolve the dispute and continue a business relationship. Not only can litigation damage business relationships, but the outcome is never certain and it detracts key employee time and some of the business’ financial resources away from the focus of the business.

Amanda Beaton, from the dispute resolution department at Hammonds in Birmingham, said: “A skilled lawyer can greatly assist in reducing litigation costs by effectively managing the dispute and in doing this alternative dispute procedures must be considered.”

One of the alternative dispute resolution procedures commonly used by litigators is mediation.

Erica Simpson, also from the firm’s dispute resolution team, said: “This is a highly effective method of resolving disputes. It is a structured negotiation which is assisted by an independent third party and normally takes place over the course of a day. Clients are more comfortable with it than with more formal dispute resolution procedures as they have control over the process and are familiar with negotiation.”

And mediation can help salvage business relationships which would flounder if the dispute proceeded to trial. Ms Beaton said: “As it is a relatively quick process and does not need as much preparation as would be needed if a more formal method of dispute resolution were undertaken, it is cost effective which is in the interests of every client.”

Mediation is also being encouraged by the courts who can penalise parties if they have not considered other alternative dispute resolution methods. Ms Simpson added: “When businesses consider the benefits of mediation, it is easy to see why it is becoming more popular than ever and most businesses want to consider meditation to resolve the dispute.”

Tuesday, April 28, 2009

Breastfeeding Not A Defense to Joint Physical Custody Canadian Court rules if you can’t wean, get a machine…

Judge rules mom is milking her parental rights with breastfeeding defence


April 27, 2009


If you refuse to wean, then get a machine, an Ontario Superior Court judge has told a mother who used her breastfeeding schedule as a technique to deny access to her baby's father.

Jennifer Johne and Carl Cavannah met at a wedding on Aug. 27, 2005. Their brief affair resulted in a baby girl being born on June 16, 2006.

After the child was born, Mr. Cavannah quit his job teaching special-needs children and moved to Collingwood, Ont., to be closer to his daughter. He started making voluntary child-support payments, took parenting courses and pored over baby books.

However, Mr. Cavannah's intensive efforts to become a fully involved parent were thwarted, in part, by a rigorous breast-feeding schedule imposed by Ms. Johne.

"The child is now more than 29 months of age and is still being breastfed," Mr. Justice Alan Ingram wrote in an eight-page ruling.

"Jen believed strongly - through medical advice - in the merits of breastfeeding. However, the breastfeeding has a secondary impact upon Carl in that it is used as an excuse to restrict his access."

Judge Ingram quoted from an e-mail that Ms. Johne, a 35-year-old artist, sent to Mr. Cavannah shortly after the baby was born.

"A baby belongs with its mother, and if you had an understanding of the needs of a fully breast-fed baby and truly had [her] interests at heart, you would not be bringing this subject up again," she stated in the e-mail.

Given her intransigence, Judge Ingram said that Mr. Cavannah, 42, had been remarkably patient.

"Jen has been unwilling to give a timetable as to when the breastfeeding will end," Judge Ingram said. "But now, the time has come for Jen to have greater consideration for the relationship between the child and Carl. If she used a breast pump and provided the milk to Carl, he would be willing to give it to [the child]."

The judge also praised the child's parents. "She has two parents who have made her the centre of their lives, unusual in that this was an unplanned pregnancy between two parents who had a brief relationship and had not committed to having children," he said.

Under the Children's Law Reform Act, a mother and father are equally entitled to custody of a child. When an access dispute breaks out, judges use a list of criteria to determine whether or not to depart from an equal-access regime.

Judge Ingram ruled that Ms. Johne and Mr. Cavannah's child would be best served by a 50/50 access arrangement.

"As soon as Jen realizes that she is one of two equal parents and the parties find a form of communication, they should be able to get on with their common goal of facilitating and encouraging [the child] to reach her full potential," he said.

Phil Epstein, a family lawyer expert, described the ruling as "one which will be of comfort to involved fathers who wish to be equal parents."

Mr. Cavannah declined to discuss the case, and Ms. Johne could not be reached for comment.

However, Ms. Johne's lawyer, Carol Allen, noted in an interview that it is very difficult to argue in favour of a continuation of breast-feeding after a child is two years old since pumping is a viable alternative.

Ms. Allen said that her client may soon be returning to court because she is dissatisfied with Judge Ingram's solution to the access issue.

"The schedule allowed the father to work four days a week, and then have the child from Thursday to Sunday or Monday night," Ms. Allen said. "That leaves the mom with no weekend time. It is probably going to have to be revisited. It's unfortunate."

Ms. Johne lives in a small town about 20 minutes from Collingwood, where she helps her mother operate a small daycare.

Thursday, April 16, 2009

Underwater Stock Options, A Problematic Marital Asset

In today’s economy a new issue has arisen regarding stock options that once upon a time had value as a marital asset. With the economic downturn, a majority of stock options are now underwater. Approximately, two thirds of public companies report their stock options underwater. How should we treat this asset in a divorce settlement?

Companies that issue stock options have to report the outstanding options as an expense on their books, driving meager earnings down. As a result, new policies are being introduced by several companies where they are re-pricing the stock options or recalling the options and reissuing them at a lower price. This may result in a new vesting schedule. This issue may also arise when a spouse loses a job, is lucky enough to find a new job and receives stock options from his subsequent employer to compensate him/her for marital options left on the table during the job change. It is necessary to anticipate this issue and address the manner of treating and dividing recalled or re-priced options when negotiating a property settlement.

It is important to include in the settlement agreement appropriate language to preserve capital gains treatment for the ultimate exercise and sale of qualified stock options. The spouse in whose name the stock options are titled (Husband) would need to hold onto the options on behalf of the other spouse (Wife), and upon the ultimate sale of her share of the options, Husband would pay to Wife her net share of the option proceeds after taking into account taxes. Possible language to include in the settlement agreement follows.

“It is understood that the Husband shall hold said options on behalf of the Wife. Husband shall not unreasonably withhold Wife’s request to sell her share of the options. Wife recognizes Husband’s fiduciary relationship to the corporation, and Husband will not be required to impair that relationship by exercising the options. Wife acknowledges that upon exercise of the options there will be a tax consequence to Husband, and she will be entitled to receive only the net after tax proceeds from the exercise of the option (net defined as Husband’s net). Husband shall have an affirmative duty to advise Wife of the vesting of the options, as well as the expiration date of the options.”