Collaborative Law . . . A Better Way – Part 1

by Duane L. Coker on August 19, 2009

Collaborative Law is quickly becoming a preferred method for handling divorce and other family law matters in Denton County and, frankly, the rest of the world.

In this part of my 3-part post, I’ll give a general overview of how cases work, when handled collaboratively, in Texas. Obviously, like the stars in the sky, there are millions of variables from one family to another and one of the benefits of Collaborative Divorce is that these variables can be handled in a way that is best suited to the party, best preserves the family relationship and protects the kids, and best preserves the parties’ marital estate.

Normally, if, after a consultation with one of our attorneys, a party wants to file for divorce and attempt to pursue it collaboratively, we will prepare and file a Petition for Divorce. Normally, we mention in our Petition that the party is interested in using Collaborative Law, and we attempt to make the Petition as non-confrontational as possible. We usually send that Petition, along with information about Collaborative Law, to the other party and hold off on having that party served. The idea is to encourage the other party to learn about the process and seek out a collaboratively trained lawyer, which is normally necessary if the case is going to proceed collaboratively. At our office (Duane L. Coker & Associates, P.C.), all of our lawyers are trained and experienced at resolving cases using Collaborative Law.

Next, assuming that the parties both hire collaborative lawyers, and agree to explore using Collaborative Law, the lawyers and clients meet to review and enter into, if acceptable, a Collaborative Law Agreement. This agreement sets out the terms and conditions governing the process, including big things like an agreement not to seek, or threaten to seek Court intervention without formally leaving the process and an agreement that, should the parties not be able to settle their differences collaboratively, the collaborative attorneys will withdraw and the parties will be required to hire new litigation attorneys for the case. Regarding this last part, most collaborative lawyers can and do handle litigation matters, however, the general consensus is that collaborative attorneys should not represent their client against the other party in litigation. There are a number of reasons for this, but, in my opinion, the most important one is that it assures that everyone is invested in the process and working toward a successful collaborative conclusion to the case – after all, if the process is unsuccessful, the attorneys are out of a job!

Often at this first meeting, and subsequent meetings, the parties elect to have a financial professional, like a CPA, and a communications coach, present to assist in the process. In Texas, we almost exclusively use this “team model” collaborative approach and often find that it results in a better outcome for the parties and an actual overall cost savings. I’ll discuss the collaborative team in future posts.

Finally, as the process proceeds, the parties will exchange full and complete information, develop options for resolving their differences, and, hopefully, reach agreements. At that point, the attorneys will work on the Final Decree of Divorce, and other closing documents, and, once the parties have reviewed, revised, and signed these documents, they are ready to be presented to the Court. Under Texas law, once the Court is initially notified that the parties have elected to use Collaborative Law to resolve their divorce case, the Court has to give the parties time to work on the case.

I’m a charter member of the Collaborative Law Institute of Texas. Their website contains a lot of additional information regarding Collaborative Law, and how it is similar to and different from more traditional, litigation-oriented approaches. You can find that information here.  For more information feel free to set a consultation with one of our attorneys by contacting us at Duane L. Coker & Associates, P.C.   You can also check out one of the following books:


Stay tuned for the last post in this series, which will discuss the Texas, or team, model, the roles of the various professionals, and questions many folks have about Collaborative Law.

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About Texas Child Support – Part 2 of 4

by Jacqueline D. Cannon on August 18, 2009

Continuing our discussion about Texas Child Support, we will explore the ways in which child support can be paid. In Part 1 of this post, we talked about calculating support, assuming you’ve gotten past that hurdle — either through an agreement with the other party or a decision by the Judge — it’s now time to start paying the child support.

How Child Support Can Be Paid

Child support is most often paid in one of two ways:

1) the Obligor can pay the child support themselves, or

2) the child support can be withheld from the Obligor’s check by their employer.

If the child support is not withheld, the Obligor is responsible for sending the child support each month to either the Obligee or the State Disbursement Unit.  In most cases, child support in Texas is Ordered to be paid through the State Disbursement Unit, which is a clearinghouse that receives the payments, credits them to the child support account, and then sends them on to the receiving party.  While, in the past, stories of mishandling of child support by the SDU were common, they have, for the most part, gotten the process down.  For the paying party, this process creates a record that the support was actually paid.  For the receiving party, the same is true and, as is often more important for the receiving party, if the support is not paid, or not paid timely, there is a record of that for subsequent enforcement proceedings.

If child support is ordered to be withheld by the employer, the amount of child support withheld from each check is calculated based on whether the Obligor gets paid weekly, bi-weekly, bi-monthly, or monthly. The employer will withhold that amount each pay period and the child support will be taken out before the Obligor gets paid. The employer will then send the child support to the State Disbursement unit who will record the payment and then disburse the money to the Obligee as discussed above. In the event that the Obligor changes jobs, a copy of the withholding order can be submitted to the new employer and they will begin withholding the child support.

If you are currently having problems with the payment, withholding or receipt of child support, it may be necessary to contact a lawyer.  Our office (Duane L. Coker & Associates, P.C.) helps clients with Texas child support issues all of the time.  We’d be happy to meet with you to discuss your situation.

In Part 3 of our post regarding Texas Child Support, I’ll discuss when child support typically ends in Texas.

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New IRA Law May Have Its Benefits

by Steve Walker on July 22, 2009

Do you have an IRA?

If so, it is probably what is termed a traditional IRA. As you may know, withdrawls from a traditional IRA are taxed as ordinary income. There is another type of IRA – a Roth IRA. One big difference between the two is that withdrawls from a Roth IRA are not taxed. Another important difference is that you do not have to make any withdrawls at age 70 ½ if you don’t want. This can be especially important to high-net-worth individuals because the Roth IRA can be passed on to their children. And, the children’s withdrawls are not taxed either.

The unfortunate thing is that the eligibility to contribute to Roth IRAs or convert a traditional IRA to a Roth IRA has been limited. For instance, in 2008 you could make a Roth IRA contribution if your adjusted gross income was less than $169,000 (married filing jointly). Effectively, upper income taxpayers have been precluded from enjoying the benefits of a Roth IRA.

In May 2006 there was a pretty significant change to the tax laws and the rules for Roth conversions. In 2010 and that one year only, any taxpayer will be allowed to convert a traditional IRA to a Roth. Converting the previously untaxed (ie, IRA rollovers) or tax deducted IRAs will generate taxes. But those taxes are to be paid one-half in 2011 and one-half in 20012 – a generous deferral indeed. Consider this added incentive. Many traditional IRAs have suffered steep stock market declines thus the conversions taxes will be considerably less.

This is pretty exciting stuff but it’s always best to make informed decisions. Be sure to check with your tax professional to determine if the 2010 rule change is right for your situation.

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All About Texas Child Support

by Jacqueline D. Cannon on July 16, 2009

Child support is perhaps the most common issue in Texas Family Law cases involving children. Our office (Duane L. Coker & Associates, P.C.) helps clients establish, modify and enforce child support in divorce and other child-related cases.

In Part 1 of my four- part post, I will discuss how child support is calculated in Texas. In Part 2, how child support can be paid and when the obligation to pay child support ends. Part 3 of my post will discuss modifying child support and Part 4 will discuss how to enforce Texas child support.

    Calculating Child Support

In Texas, child support is calculated based on a percentage of the Obligor’s (the party paying child support) net monthly resources (income). Texas does not take into consideration the Obligee’s (the party receiving child support) income. The income of the Obligor’s spouse is also not considered in determining the amount of child support.

Net resources include, but are not limited to, 100% of all wage and salary income (this includes tips and overtime), self-employment income, social security or disability benefits, worker’s compensation, retirement benefits, and spousal maintenance. Social security taxes, federal income taxes, state income taxes, union dues, and the cost of health insurance or cash medical support are deducted from the Obligor’s resources to determine the Obligor’s net resources. These deductions are calculated using the Texas Attorney General’s Tax Charts.

The percentage applied to the Obligor’s net monthly income is based on how many children the Obligor has with the Obligee and how many other minor or disabled children the Obligor has with someone else that he or she has a legal duty to support. For example, if the Obligor and Obligee have one child together and the Obligor has one minor or disabled child from a previous relationship and the Obligor is paying child support for that child, the percentage applied to the Obligor’s net monthly income is 17.50%.

It is a common misconception that if the Obligor does not have a job then they cannot be ordered to pay child support. If the Obligor is unemployed, the court can order child support based on minimum wage. The amount will be calculated the same way as if the Obligor was employed.

A good Texas family lawyer can help you figure out how much child support you should pay or receive based on your specific circumstances.

Stay tuned for Part 2 of this post, which will discuss how Texas child support can be paid and when the obligation to pay support ends. If you have further questions regarding child support in your Texas Family Law case, feel free to contact me, or one of the other attorneys at our office, on-line at Duane L. Coker & Associates, P.C.

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An Anatomy of a Divorce Decree – Part 2

by Duane L. Coker on July 1, 2009

This is the second part of a two-part post giving a general overview of a Texas Divorce Decree.

As I mentioned in my last post, the Decree is the order that the Judge signs, at the end of your divorce, which grants your divorce. Every decree is different, but most are made up of similar sections. The purpose of this article is to give a very general overview of these sections to begin an understanding of what can be a very complex document.

A Decree could consist of any number of sections not described in this post. Much like people, and marriages, every one is different and particular to the folks getting divorced. However, in my previous post, I discussed the sections likely to be found in the Decree for a divorce without children. In this post, I talk about the sections most likely to be also included in a Decree in a divorce with children.

Conservatorship

The Conservatorship section of the decree sets out each parent’s rights and duties with respect to the children.  These include basic rights, like the ability to review medical records and attend school functions, to very specific rights, like the right to establish the child’s primary residence or make educational decisions.  How these rights and duties can be shared between the parents is a long discussion best suited for another post, but, in Texas, the presumption is that most parents should be appointed as Joint Managing Conservators of their children.  This means that both parents share in these conservatorship rights and duties.  Another topic for a later post is a discussion of the right to establish the primary residence of the children.  This is the right most people are talking about when they talk about having “custody” of their child or children.  This is also the right in dispute in a “child custody fight”.  

Finally, one of the hottest areas of child-related family law litigation is the issue of a geographic restriction.  This involves whether the parent, who has the right to establish the child’s residence, must do so within a certain area.  The primary goal of a geographic restriction is to keep the children close to both parents.  However, this can often present difficulties when the parent establishing the residence of the child needs to move for work, family, or some other reason.  Because of the significant legal issues involved, these cases are often hotly contested and frequently result in a trial.

 Possession

The Possession section of the Decree sets out the schedule of time that the child spends with each parent.  This section is also often referred to as the “Parenting Time” section.  The Texas Family Code sets out a Standard Possession Order that is to be used in most cases.  However, because Texas law permits agreed divorces, parents can vary from this Standard Possession Order, and often do, to set up a schedule that they believe is in their child’s best interest.  As this is a general overview of the Texas Divorce Decree, I’ll discuss the Standard Possession Order, and variations on that Order, in a later post.  However, most parents in Texas have friends or family members, who exercise possession of their children under this Order and are somewhat familar with the 1st, 3rd, and 5th weekend schedule, with extended summer possession and alternating holidays, that these folks are using.

The Possession section of the Decree will often contain many other details, including where the children will be exchanged by the parents, provisions for long-distance travel or international travel, and so on.

Child Support

One of the most often modified sections of a Court order related to children is the Support section.  This section of the Decree specifies which, if either, parent will pay child support and how much is to be paid.  It also will set out the details about whether this support will be paid directly or through wage withholding and often contains provisions related to payment for other expenses (extracurricular activites and big ticket expenses like a car for the child).  We are working on separate posts, which will appear in coming months, regarding Child Support, how Child Support is calculated, how to modify Support – increase it when the paying parent is making more money or decrease it when, for example, the paying parent loses their job – and Child Support Enforcement issues.

Medical Support

This section of the Decree specifies how health insurance will be provided for the child, who will provide it, and how it will be paid for by the parents.  Most commonly in Texas, the parent who pays child support also pays for the cost of health insurance and provides it through their employer.  However, there can be many variations on this and, because of the high cost of health insurance, parents will often work together to obtain the best coverage for their children at the least expense.  The Medical Support section of the Divorce Decree generally also contains provisions for the payment of uninsured medical expenses, like copays, prescriptions, dental and orthodontic expenses, which are commonly shared equally by the parents.

The Child Support and Medical Support sections of the Decree are usually very specific and contain a lot of detail about how the support and medical expenses are to be handled.  This is necessary because, should it become necessary to legally enforce these provisions, the law requires that level of detail.  However, parents are often surprised that their Divorce Decree can end up being 40-50 pages long, or longer, and that so much of the Decree is taken up by these sections.

As I said in my last post, this is a very, very general overview of the Texas Divorce Decree.  As we continue to provide information about divorce in Texas, we will address various aspects of each of these sections, the issues involved, and common (and not so common) problems folks face when going through their divorce.

If you have any questions about this post, or if you wish to speak with an attorney about your divorce or family law situation, feel free to contact us through our website at http://www.cokerlegal.com.

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Collaborative Law . . . A better way – Intro

by Duane L. Coker on May 5, 2009

This is a three part post on what is quickly becoming the preferred way to handle divorce and family law matters — Collaborative Law.

Collaborative Law Divorce has been gaining popularity in Denton County and many legal, financial, and mental health professionals are working hard to better their skills at handling family law cases collaboratively.

In short, Collaborative Law offers spouses and parents the opportunity to agree to take their case out of the traditional litigation model that has been used for years, to gain control over the outcome of their divorce or family law matter, and to resolve their differences with dignity and privacy often lost in the traditional approach to family law litigation.

At Duane L. Coker & Associates, P.C. all of our attorneys are collaboratively trained.

We are frequently asked questions about Collaborative Divorce and recommend a number of books to our clients. While the second two parts of this post will explain Collaborative Law more in depth, if you can’t wait to learn more, I recommend the following:

Check back soon for Part 1 and Part 2 of this post. In Part 1, I will give a general overview of the Collaborative Process as it often plays out in a Divorce case here in Denton County. In Part 2, I will attempt to answer many of the questions I often hear about Collaborative Law.

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Managing Savings in a Turbulent Economy

by Steve Walker on May 4, 2009

[Editors note: This article was originally published by Steve in February of this year. However, with continued market fluctuations, it is still relevant and focuses on a concern many facing divorce in Texas deal with daily as they work to preserve wealth and consider the division of their community property marital estate]


Our economy continues to shock and surprise, causing growing concern for investors, particularly those with their eye on retirement. A recent article by William Reichenstein in The American Association of Individual Investors Journal titled “Will Your Savings Last? What the Withdrawal Rate Studies Show” provides insight into what can be done to weather this economic storm. This article reviews two studies that seem to suggest a definitive safe withdrawal rate is possible to help minimize risk while maximizing the benefit to the investor.


First, the article points out that determining the withdrawal rate is a balancing act. If withdrawals begin with an initial rate that is too large, the investor will have an unacceptable large shortfall risk, which is defined as the probability of running out of money within the investor’s lifetime. However, if the withdrawals are too little, the investor’s lifestyle will be below his or her means. Based on the two studies evaluated in this article, the “Rule of Thumb” is as follows:


Assuming an asset allocation of at least 50% stocks, a retiree who withdraws 4% of the portfolio in the initial year and an inflation-adjusted equivalent amount each year thereafter has about a 90% to 95% probability that the portfolio will last 30 years.


As with any Rule of Thumb, this, while a useful thought, is grossly understated. Several factors can influence the shortfall risk. The first factor considered in this particular article is the sequence of returns; a portfolio will last much longer if returns are strong in the early years and poor in the later years than vice versa. Also, a portfolio’s asset allocation between stocks and bonds can vastly impact the longevity of the income stream. Finally, another major factor, as is always the case with “Uncle Sam”, is taxes. It is important to consider whether funds have been held in tax-deferred accounts such as 401(k) or if the funds are in a taxable account, where interest, dividends and realized capital gains are taxed each year.


Perhaps most notable, these studies implicitly assume that future gross stock and bond real returns will mimic- or at least be similar – to historical gross returns. Conversely, recent economic reports seem to imply that we are facing unchartered territory. In short, while using the 4% Rule of Thumb as a guideline, be prepared to adjust future withdrawals as necessary to accommodate to the economic fluctuations.

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