What is an Ostler/Smith Order?

Experienced family law attorneys in the Bay Area will tell clients that an Ostler-Smith order is an additional support order (child or spousal) that takes into account overtime or bonus income. 

How is child support calculated? 

Under California Family Code Section 4058, salary and wages are includable for purposes of determining annual gross income. Gross income can also include income such as commissions, bonuses, rents, dividends, pensions, interest, trust income, annuities, workers’ compensation benefits, unemployment insurance benefits, disability insurance benefits, Social Security benefits, and spousal support actually received from a person not a party to the order at issue.  And what about inheritance? Although a party’s inheritance is not income under Family Code 4058, the court may consider it as a “corresponding reduction in living expenses”.  

What is a bonus table? 
If you or your ex has an income that fluctuates due to overtime or bonus income, the court will order a set amount for support and an Ostler-Smith order for any overtime earnings or bonus income. At the time the child support is set, the Court will refer to a schedule which provides for a specified percentage of any bonus or overtime to be paid “as and for” child support. The actual percentage will vary depending on the amount of the bonus or overtime.  (See below for an example).

The person who pays support could be ordered to pay a base rate of $2,000 per month for child support.  In addition, he court could also issue an Ostler-Smith order of a fixed percentage of all bonus income received payable as additional child support.  

The payor spouse can be ordered to pay a bonus percentage for both child and spousal support.

Typically,  "Bonus income" is defined as income resulting from employment or self-employment in excess of regular periodic earnings.

Contact a family law attorney today to speak about bonus income and what you or your child may be entitled to receive or what you may be ordered to pay. 

I'm always interested in hearing from readers of this blog and if you have questions, you can reach out to me at amanda@gordonfamilylaw.com or (415) 326-4148. 

Sample Ostler Smith Order

 

I’m getting a divorce, do I need to change my estate plan?

Yes.

If you have recently started the divorce process, you will also want to consider your estate planning goals in light of your divorce. If you decide to make changes to your estate plans, or to create an estate plan for the first time, it is important to work closely with an experienced family law and estate planning counsel to effectuate your testamentary goals without violating the Automatic Temporary Restraining Orders (“ATROs”) set out in Family Code §2040.

The ATROs are effective the moment you file for dissolution, or are served by your spouse, and remain in place until all issues in your case are resolved. The ATROs govern what changes you may make to your estate plans unilaterally, what changes require notice to your spouse, what changes require the consent of your spouse, and what changes can be made only with a court order.

Changes You May Make To Your Estate Plans

A primary purpose of the ATROs is to maintain the status quo for the protection of parties and children while the division of marital assets is in progress. Among other things, this means maintaining health and life insurance beneficiary designations, revoking existing trusts (and severing existing joint tenancies) only after notice is served on the other party, and prohibiting assets from being transferred to trustees of new trusts (who might not be subject to the court’s jurisdiction) except with the express consent of the other party or by order of the court.

It is also important to understand what would happen to your estate if you were to die during the pendency of your dissolution without making any changes to your estate plans. The answer depends on whether you were to die before or after entry of judgment terminating your marital status.

Death Before Entry Of Judgment Terminating Marital Status

If you were to die before entry of a status-only judgment, the Family Law Court would lose jurisdiction over all issues, except those already adjudicated. Under these circumstances, your share of the community property and all of your separate property would pass as if the Petition for Dissolution of Marriage had not been filed. Thus, your assets would pass to the beneficiaries of your current estate plan, usually your spouse. If you do not have an estate plan, your estate would pass through probate, and your spouse would receive all the community property and your separate property. Any nonprobate assets, such as retirement assets and life insurance plans, would pass to your designated beneficiaries.

Death After Judgment Terminating Marital Status

If you were to die after a status-only judgment that expressly reserves jurisdiction over the remaining issues in the case, the Family Law Court would retain jurisdiction, and the property division would take place there. The Executor of your will would be substituted in for you, and the Family Law Court would retain jurisdiction to decide the remaining issues in the case.

Death after a status-only judgment also has a very different impact on how your estate would be distributed. A judgment of dissolution automatically terminates nonprobate transfers between former spouses, including wills, trusts, and beneficiary rights under retirement plans. It also terminates the right-of-survivorship interest in joint tenancies and community property with right of survivorship. Unless the respective wills otherwise provide, the judgment also revokes all testamentary transfers between former spouses and any provision in a will nominating the former spouse as trustee, conservator, or guardian. However, a judgment of dissolution does not terminate the surviving spouse’s rights as a designated beneficiary under a life insurance policy. The purpose of this post is to highlight the importance of estate planning during and after your dissolution.

Contact me at amanda@gordonfamilylaw.com for more information. 

Why every California professional needs a prenup.

You’ve created the perfect Pinterest wedding board, invited your friends to the Vegas Bachelor party, and booked your honeymoon in Fiji. What’s next?  A prenup. Yes, you really should have a prenup.

Sure, prenuptial agreements aren’t very sexy or romantic, but what you may not realize is that even if you don’t sign a prenup you are already agreeing to one: the California state default. Even if you decide not to negotiate a prenup, it is absolutely necessary that you understand the financial implications of one of the most important agreements of your life: your marriage contract.

California is a community property state. This means that unless you create an agreement to the contrary, any property that you guys acquire during the course of a valid marriage is characterized as “community property,” and in the event of a divorce, each spouse is entitled to half of it.

This doesn’t include property acquired before marriage, after permanent separation, through inheritance, or as gifts: these types of properties are separate property and most of the time you get to keep this property in a divorce.  

Risk, what risk?

There are other risks that you may take on if you don’t have a prenup.  First, if you gain significant equity in a startup or business during the marriage and divorce without a prenup, your spouse may get half, possibly including that equity’s share of control over the company. Additionally, any increase in the value of separate property during the marriage (including capital gains), is considered community property if one spouse used his/her skill and effort to increase the value during the marriage. 

Another reason to get a prenup is if one spouse is likely to acquire debt during the marriage. Community property rules mandate that assets and debts acquired during marriage are shared equally, so if you marry someone with a tendency to spend more than they earn, a prenup could save you money.   

There are some protections in this default contract as well. Most notably, a spouse is entitled to reimbursement of any separate property he/she used to acquire community property. For example, if you use separate property--like the proceeds of sale of stock acquired before the marriage--as the down payment for a house bought during the marriage, then you are entitled to get your separate property without interest back at the time of divorce. 

Alimony,  sounds old school, didn’t we get rid of that?

Finally, California’s default system allows for a judge to award spousal support for both short and long term marriages. The amount of spousal support awarded by a judge at divorce is variable and not set by law. While marriages that are shorter than 10 years rarely have indefinite support awards, the standard constantly changes. Without a prenup, you cannot predict or control whether spousal support will be ordered by a Judge in the event of a divorce. 

Legal Details

In short, the prenup details what happens to property in the event of a divorce. It is a negotiated contract that identifies rights, obligations, property division, and potentially spousal support in the event your marriage ends in divorce. Having an agreement in place can save expensive divorce litigation and more importantly, provide transparency to the finances in your relationship.  

In order to create an enforceable and valid prenup, there are several legal formalities. (1) Both parties must be represented by separate independent attorneys, (2) disclose fully their finances (including any assets and debts), and (3) the final form of the agreement must be in the hands of each party at least 7 days prior to signing the document.

Want to learn more? Talk to a family law or estate planning attorney about the specifics of your situation.  

A prenup typically takes several months to negotiate, so you’ll want to start the conversation well before your wedding date.
I understand that drafting a prenup does not sound fun. But prenups are crucial for numerous reasons. Most importantly, having a say in your financial future. You would never sign a contract without reviewing the terms, and marriage shouldn’t be different. 

If you are considering a premarital agreement, contact amanda@gordonfamilylaw.com for more information. 

What happens if you fail to pay child support?

California Law (Family Code 6500) mandates that each parent has an obligation to support a minor child. This means that parents are required to provide for their children, whether or not they currently live with their children. Experienced family law attorneys will tell you that a court may make child support orders in any legal proceeding that involves dissolution of marriage, legal separation, or child custody.  It is important to remember that an order for child support can be made retroactive to the first date of filing of the request for child support.

How much will I have to pay?

Child support is determined by a state guideline formula that takes into account both parents income, timeshare with the child, custody, and other children in the house. Child support payments can be modified by the court at any time, so consult an attorney if you have recently lost your job or had a change in your family situation. You can also use the state’s guideline calculator to figure out if your obligation has changed.

http://www.childsup.ca.gov/resources/calculatechildsupport.aspx

What happens if I fail to pay?

The consequences of failing to pay a child support obligation can be dramatic, so it is important to be informed about the penalties.  Remember that if the court has made a child support order, you are likely required to pay the state who will then pay the other parent.  Any missing payments are considered arrears and the state keeps track of these payments and the interest (10%) that builds.
The Department of Child Support Services has wide latitude to enforce child support orders and can use any of the following methods: (1) suspension of state licensure including drivers licenses, State Bar, Department of Fish and Game, (2) bank levy, (3) garnishment of unemployment benefits, (4) interception of federal and state tax returns, (5) Pas sport holds (where the individual cannot apply for a passport renewal), (6) garnishment of State retirement benefits PERS, and last (7) a contempt proceeding can result in jail time. 

Can I really go to Jail?
Yes.  California law provides that intentional failure to provide for a child under the age of 18 is a misdemeanor with a maximum punishment of 1 year in the county jail and a $2000 fine. Pen C §270.
Typically, an individual who has failed to make child support payments will be arrested and arraigned if they continuously fail to make payments. Failure to follow a court order including a child support order is considered contempt and a court can order jail time for numerous counts of contempt.
If you have a child support order and have failed to make payments, contact a family law attorney, you can contact me at amanda@gordonfamilylaw.com for help.  Even if you have lost your ability to pay, Attorneys are able to work with you to understand your rights and obligations. 

My child’s mother does not follow our visitation schedule, how can I get her to comply?

Experienced San Francisco Bay Area family law attorneys will tell their clients that child custody and visitation can always be modified by either parent until the child’s 18th birthday.  

I frequently consult with clients who have court ordered parenting schedules that are no longer followed by the primary parent. Sometimes this happens because my client cannot afford to pay support or they have a new work schedule. However, failure to pay support is not actually a legally sufficient reason to restrict custody and visitation. 

A common complaint is that the primary parent fails to make the child available for the agreed upon court ordered schedule and that the non-primary parent is prevented from seeing the child. If this sounds like your situation, where the custodial parent has stopped complying with a custody schedule, it may be necessary to seek a Contempt order.

As a practical matter, a motion for contempt for custody and visitation is a last resort and may prevent reasonable cooperation and may detrimentally affect the child. Thus, the decision to bring a contempt motion for visitation must be carefully considered and other methods such as FCS mediation and co-parent counseling should be exhausted before a motion for contempt is filed.

Contempt is available to enforce orders governing custody, visitation, and residence of a child. California case law states that contempt is a remedy available against a parent who does not comply with a court-ordered parenting plan regarding custody and visitation.  Additionally, Custody and visitation orders issues by a foreign court are also enforceable by contempt.  Contempt may even be available when a parent fails to follow the spirit of co-parenting. 
In one case, the court had made an initial court order that Mom was not to interfere with Dad’s custodial time. However, Mom attempted to alienate the children by her actions, words and demeanor and she continued to interfere with Dad’s custodial time and was ultimately found in contempt. 

The failure to follow custody and visitation comes up most frequently in the context of teenagers.  

I frequently get questions by parents of teenagers whose teenagers refuse to see the non-primary parent. Unfortunately, these cases may not be good candidates for Contempt because if a parent shows that they do not have sufficient control of the teenager, then there can be no contempt finding if the child refuses to participate in the ordered visitation.  For example, a custodial parent may not be held in contempt for violation of a visitation order based on the failure of an unwilling child to visit unless you show proof that the parent is able to compel visitation. 
In the context of child custody and visitation, in order to successfully pursue a contempt charge, you must describe the details of the violations that give rise to the charge of contempt. These are frequently documented in emails, text messages, and phone logs. You can prepare for a contempt hearing by describing how the order was violated and when it was violated.  To learn more about filing Contempt, contact Gordon Family Law at (415) 326 – 4148.

Want to learn more, including how to file for Contempt?

Check Out:

What to do if your ex does not pay support or follow visitation: how to file for Contempt.

Is your ex-spouse a "deadbeat"?

My ex spouse stopped my spousal support payments, what are my options.