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18 Apr 2024

Joe Arcieri Songs: Long Walk of the Navajo

Joe Arcieri is a friend of mine who I worked with for many years during my ten years working for Acme Markets.  Joe, when not stocking milk or saving lives as a nurse, is an excellent guitar player.  I have had the privilege, from time to time, of (badly) plunking my bass guitar with Joe as he melts a face or two with a great solo.

As great musicians do, Joe has written some of his own songs and keeps a soundcloud site to post them.  When I have opportunity, I will post his music here as well.

Here is his composition called “Long Walk of the Navajo” which you can find here.

Here are the links to the previously posted songs by Joe:

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16 Apr 2024

Pennsylvania Superior Court Clarifies How to Determine Parentage

In the matter of Glover v. Junior, the Pennsylvania Superior Court clarified how to determine parentage, especially when the two prospective parents divorce.


In the matter of Glover v. Junior, 2023 Pa.Super. 261, the Pennsylvania Superior Court clarified how to determine parentage, especially when the two prospective parents divorce.

The two parties in this matter, Glover and Junior, were female same-sex partners (once married, now likely divorced) who pursued in vitro fertilization (IVF) to conceive a child. Glover was the woman whose eggs were used and became pregnant. Unfortunately, during the course of the fertilization and pregnancy process, the parties separated and engaged in divorce litigation.  Due to the deterioration of their relationship, and divorce litigation, Junior filed a petition for pre-birth establishment of her parentage over the child carried by Glover. In opposition, Glover essentially argued that she is the only biological parent and, by the time the child was born, the parties were separated and a divorce action had been filed. The trial court ruled in Junior’s favor (granting her parentage over the child), leading Glover to file an appeal to the Superior Court, which affirmed the trial court’s ruling.

The Superior Court was quick to point out that, given that the parties were not involved in adopting a child, and did not, obviously, conceive the child with one another, this is not a paternity case, as typically understood, but is, instead, a “parentage” case to determine who a legal parent is for a child.

The court also addressed the application of the presumption of parentage that married people have over children born during a marriage. Essentially, a child conceived or born into an intact marriage is nearly irrebuttably presumed to be the child of the marriage. One of the primary goals of this presumption is to preserve an intact marriage; however, the Pennsylvania Supreme Court has ruled that the presumption does not apply where the parties have finalized their divorce prior to the parentage dispute. In light of the divorce status of the parties, the court ruled that the above-mentioned presumption would not serve the purpose of the presumption, as the marriage is no longer intact. As a result, the above-described presumption does not apply to the instant matter.

Among her arguments, Glover argued that the court did not have subject matter jurisdiction over the issue of parentage as Junior did not plead her parentage claim in her divorce complaint, opting to file a separate petition instead. The court rejected this argument. The court first noted that the courts of common pleas in Pennsylvania have unlimited original jurisdiction over all proceedings in the commonwealth, and, to this end, the court is competent to entertain parentage claims. Glover’s attempt to also argue that the court does not have authority to rule on this matter was rejected by the court as well. First, the argument was waived due to it not being raised at the trial court’s evidentiary hearing. Second, the court looked to 23 Pa.C.S. Sections 3104 and 3323 as specific bases for its authority in this matter, with a special focus on 3323(f) serving as a “catchall” granting courts authority over matrimonial cases.

In order to determine whether Junior has a right to parentage over the child, the Superior Court surveyed all of the facts presented. Upon its review of the facts, the court found that the facts overwhelmingly revealed that the parties fully intended Junior to be a co-equal parent with Glover. The most salient facts were that the parties entered into contracts with the fertility clinic and other entities (e.g., a doula and an attorney to help with their intended adoption) which reflected Junior as a co-parent or partner. In furtherance of the IVF treatments, Junior participated with Glover in selecting the sperm donor and the child’s name. In addition to contracting with various entities, Junior also contributed to half of the related expenses for the contracts, and was fully participatory with Glover for Glover’s various medical appointments and such (before they separated, obviously) and fertility treatments (e.g., administering Glover’s daily fertility injections). Indeed, the court also noted that, regardless of the written contracts described above, the parties clearly entered into an oral contract that Junior was to be one of the child’s parents.

Upon reflection on the above, the court ruled that the parties entered into what is essentially a contract to establish Junior’s parentage, and, under the principles of contract law, Junior is the child’s legal parent. While parentage is typically established biologically, contracts regarding parental status must also be honored in order to prohibit an individual’s reproductive options, even if, as in this case, only one party would be genetically related to the child.

Finally, almost as an aside, in consideration of relevant Pennsylvania Supreme Court decisions, the Superior Court found that the record in this case clearly supported a finding of parentage by intent. Specifically, the court believed there was clear evidence that the parties mutually intended to conceive and raise a child, and jointly participated in the process of conceiving a child in furtherance of that intent.

In light of this case, the Pennsylvania Superior Court has further developed what the legal criteria is to be a parent to reflect the changes in science and culture regarding the conception and rearing of children.

James W. Cushing is senior associate at the Law Office of Faye Riva Cohen and managing attorney for Legal Research Inc., and sits on the executive committee of the family law section of the Philadelphia Bar Association.

Originally published on March 12, 2024 in The Legal Intelligencer which you can find here.

Posted in My Articles, My Articles: Family Law | Leave a comment
11 Apr 2024

Joe Arcieri Songs: Black Magik

Joe Arcieri is a friend of mine who I worked with for many years during my ten years working for Acme Markets.  Joe, when not stocking milk or saving lives as a nurse, is an excellent guitar player.  I have had the privilege, from time to time, of (badly) plunking my bass guitar with Joe as he melts a face or two with a great solo.

As great musicians do, Joe has written some of his own songs and keeps a soundcloud site to post them.  When I have opportunity, I will post his music here as well.

Here is his composition called “Black Magik” which you can find here.

Here are the links to the previously posted songs by Joe:

Posted in My Articles | Leave a comment
28 Sep 2023
2 Comments

YesSource: October 2021 Collection of Arkady Shilkloper Tributes to Yes

Here are my latest uploads to YesSource, my Yes rarities youtube page (about which you can read here).  This post is another addition to my series of Yes music posts and a collection of all my Yes-related posts is here.  Yes, of course, is a, if not the, premier progressive rock band, and I am an enormous fan of it.

You can see all of my Yessource uploads here.

My latest YesSource uploads can be found here:

Posted in My Articles
26 Sep 2023
1 Comment

Pa. High Court Tackles Stepparent Adoption, Parental Termination and Marriage

In the recent matter of In re Adoption of M.E.I., a Minor, Appeal of D.D.L., Father, the Pennsylvania Supreme Court helped clarify the process for a stepparent to adopt a child.

In M.E.I. the child-at-issue (the child) was born during the marriage of C.J. (the mother) and D.D.L. (the father). Unfortunately the mother and the father divorced when then the child was 2 years old. For about a year’s time the father was actively involved in the child’s life, having custody of the child every other weekend. At the time, the father was living with his parents who also enjoyed a good relationship with the child. When the child was 3 years old, the relationship between the father and his parents deteriorated to the point where the father moved out of his parents’ house.

Upon the father’s vacating his parents’ house, the father withdrew from having an active role in the child’s life. To that end, he signed an agreement giving the mother sole and exclusive physical and legal custody of the child, and stopped all communication with the child. As he was essentially out of the child’s life, the mother terminated the father’s child support obligation for the child.

Given the father’s withdrawal from the child’s life, the mother eventually attempted to have her long-term male partner (the partner) adopt the child and replace the father in the child’s life. After the father withdrew from the child’s life, the partner voluntarily took on a parental role over the child, and the child called him “Dad.”

An extensive compendium, for Pennsylvania attorneys handling matters of Family Law, of MODEL FORMS in matters of Separation, Divorce, Child Custody, Visitation and Domest…

The central issue in this matter is compliance with the statutory legal process to allow the partner to adopt. Specifically, there is a two-fold process in order for the partner to adopt the child as a stepparent. First, the father’s parental rights to the child need to be terminated at approximately the same time that the child is to be adopted by to follow the partner. Second, the parent seeking parental termination (in this case the mother) must also relinquish her own parental rights in order to consent to the partner’s (a nonspouse) adoption.

In this matter, however, the mother never relinquished her rights to the child. The issue facing the mother is the fact that, per Pennsylvania statute (23 Pa.C.S. Section 2901), unless “cause” is shown, relinquishment is not required only if a parent in the mother’s position is married to the proposed adoptive parent (i.e., a stepparent), and the mother is not married to the partner.

At the conclusion of the trial in this matter the court granted the mother’s petition to terminate the father’s parental rights and expressly indicated that it would grant the petition to allow the partner to adopt the child after the appeal period expired. Paradoxically, despite the father’s complete absence from the child’s life, he appealed the trial court’s decision described above. On appeal, the Pennsylvania Superior Court remanded the matter to the trial court, which the Supreme Court affirmed.

On appeal, the Supreme Court noted that as she is not married to the partner, the mother must relinquish her rights in order to allow her to consent to the partner’s adoption of the child. The fact that she did not relinquish her rights is, on its face, noncompliant with the statute, which means the partner’s adoption of the child could not move forward.

The court further noted that the exception to the relinquishment requirement described above is if the parent of a child is married to the potential adopting parent. In that instance the parent need not relinquish her rights. In this case, however, the mother and the partner were not married and testified that there were no immediate plans to marry. When the parent and the potential adopting parent are not married, the statute specifically allows for an exception to the marriage requirement “for cause shown.” In this case, the mother did not present any arguments or evidence to demonstrate any cause to justify her fitting into the exception noted above.

While “for cause shown” is not defined in the statute, the court did review the limited case law on the subject. Perhaps the most instructive case cited by the court involved a same-sex couple who lived as a de facto married couple before same-sex marriage was legalized. As this couple was de facto living as a married couple, they could demonstrate that their “cause” necessitating exception from the statute was that people in their situation could not, at that time, legally marry.

Based on the above, as the statute requires the mother to relinquish her rights, and there was no showing at the trial court as to whether she can demonstrate “cause” to justify exception from the requirement to be married to the partner, the Supreme Court affirmed the Superior Court’s ruling to remand this matter to the trial court to allow the mother to present testimony and evidence as to whether she has “cause” to be excepted from the statutory requirement to be married when attempting a stepparent adoption.

James W. Cushing is senior associate at the Law Office of Faye Riva Cohen and managing attorney for Legal Research Inc., and sits on the executive committee of the family law section of the Philadelphia Bar Association.

Originally published in The Legal Intelligencer on September 25, 2023 and can be found here, and reprinted in the PA Family Lawyer in its Winter 2023 issue and can be found here.

Posted in My Articles: Family Law
06 Jul 2023
1 Comment

Is a Department of Human Services Decision Binding on a Custody Matter?

While having an ALJ rule in your client’s favor in a DHS matter is certainly a good thing for your client, there is a likelihood that it will have little, if any, impact on a parallel custody matter.

It is not uncommon for a custody matter to involve a parallel issue, investigation, or case with the Department of Human Services (DHS). DHS typically investigates and makes determinations regarding child abuse, child neglect, and similar issues. If an administrative law judge presiding over a DHS case makes a ruling as to child abuse, what, if any, authority does that carry with it in a custody matter involving the same child and parties? The recent matter of A.C. v. J.B., 1751 EDA 2022, attempts to shed some light on that question.

The matter in A.C. involved an allegation that the father sexually abused the child-at-issue (child) when the child was about 3 and a half years old. In December 2014 the court entered an order whereby the father and mother of the child would share custody over the child, with the mother having primary custody and the father having partial custody. The parties shared legal custody. This arrangement, with some minor variations, persisted until 2018 when the mother alleged that the child reported that he was sexually abused by the father. In light of this, the court entered a temporary order granting the mother sole physical and legal custody over the child.

Simultaneously, the DHS investigated the allegation of sexual abuse, which resulted in a finding that the abuse was “indicated.” In the beginning of 2019, the father filed a timely appeal of this DHS finding, and sought to have the finding of “indicated” expunged. A hearing was held on the father’s appeal before the Bureau of Hearings and Appeals (BHA). It may be noteworthy that the father represented himself at this hearing and directly cross-examined the child at the same.

After the hearing before the BHA, the administrative law judge (ALJ) issued an adjudication finding that DHS failed to meet its burden of proof to establish the father committed the abuse of which he was accused. As a result, the DHS was directed to expunge the indicated report mentioned above.

By 2020, based on his success before the BHA, the father filed to modify the custody order granting the mother sole custody. After a multiday trial at the end of 2021, during which multiple mental health experts testified, the court ruled that the mother would retain sole physical and legal custody, with two provisos: first, the father would have the right to be informed about the child’s medical care and education and other personal issues, and, second, the father and child would undergo reunification therapy.

In making its ruling, the court specifically found while the ALJ’s decision was admissible as evidence, the court was not bound by his decision, and did not accord it any weight accordingly. The father filed an appeal from the trial court’s decision to the Pennsylvania Superior Court on several grounds, all of which were found to be either waived or without merit; however, for the purposes of this article, the focus will be on the issue of the authority of the ALJ’s adjudication on the trial court’s order.

The Superior Court acknowledged that the ALJ ruled in the father’s favor due to the DHS not presenting substantial evidence. In so doing, the c ourt pointed out that the standard of proof before a BHA ALJ is “substantial evidence,” whereas the burden of proof before the trial court was “preponderance of the evidence.” Furthermore, the Superior Court also noted that the purpose of the BHA hearing is different from the custody hearing. The BHA hearing is to determine whether the commonwealth’s maintaining a record of an “indicated” finding is consistent with the Child Protective Services Law, whereas the trial court hearing a custody matter must make a decision according to what is in the best interests of the child, which is a much broader and significantly different purpose.

In addition, the trial court disagreed with the ALJ as to the credibility of the child. The Superior Court noted that, pursuant to normative and well-established law, it would not interfere with the trial court’s credibility determinations. Furthermore, the trial court’s reasons for disagreeing with the ALJ’s decision on credibility were reasonable. The trial court took issue with the fact that the child had to testify in open court at only 7 years old and without the support of his mother or the guardian ad litem, and had to get cross-examined by his alleged abuser (namely, the father).

Based on all of the above, the Superior Court affirmed the trial court’s decision not to accord the ALJ’s adjudication any weight in the custody matter. Ironically, however, the trial court itself also found that there was insufficient evidence to find that the father sexually abused the child, yet, due to the facts that the child himself appeared to have a sincere belief that he was sexually abused by the father, and that the father had not had any custody time with the child for about four years, the court did not believe it was in the best interest of the child to simply grant the father custody again without requiring reunification therapy to help them transition back into having a parent-child relationship.

The matter of A.C. v. J.B. serves as a cautionary tale to custody practitioners. While having an ALJ rule in your client’s favor in a DHS matter is certainly a good thing for your client, there is a likelihood that it will have little, if any, impact on a parallel custody matter.

By James W. Cushing, Esquire and published on June 23, 2023 in The Legal Intelligencer and can be found here and reprinted in the PA Family Lawyer in its Fall 2023 issue and can be found here.

James W. Cushing is senior associate at the Law Office of Faye Riva Cohen and managing attorney for Legal Research Inc., and sits on the executive committee of the family law section of the Philadelphia Bar Association.

Posted in My Articles, My Articles: Family Law
11 Apr 2023
1 Comment

Recent Pa. Supreme Court Case Changes Course of Pending Adoption Case

In the matter of In re Adoption of A.M.W., A Minor, Appeal of M.J.G., 2023 PA Super. 10 the Pennsylvania Superior Court ruled on an appeal from competing adoption petitions, and ultimately remanded the matter back to the trial court.

In this matter the mother was pregnant and gave birth to the child in December 2009 while she was in a relationship with M.J.G. The child’s biological father was never in the child’s life. The mother and M.J.G. were eventually married, but divorced in 2017. Thereafter, the mother married E.B. in 2019. In 2021, both M.J.G. and E.B. filed petitions to adopt the child.  

In his petition, M.J.G. detailed his relationship with the child, which included his acting as a father figure since the child’s birth, and participating in all of the traditional “firsts” of parenthood, including being present at the child’s first steps and her first words. He went on to say that he is called “daddy” by the child; he financially supported her and was held out as her father.

Significantly, as part of the post-nuptial agreement between the mother and M.J.G. pursuant to their divorce, they included provisions regarding custody and support of the child, which M.J.G. performed.

In June 2020 the mother and E.B. filed to terminate the biological father’s parental rights, and the request was granted. In February 2021, both M.J.G. and E.B. filed competing petitions to adopt the child. At the trial level, the court dismissed M.J.G.’s petition, ruling that he did not have standing as the mother married E.B., and consented to E.B.’s adoption of the child (this was despite M.J.G. having in loco parentis status). The trial court further ruled that the mother’s consent was required to confer M.J.G. the right to intervene. M.J.G. appealed.

In its review of the applicable law, the Superior Court noted that adoption is purely a statutory right. Further, the court is empowered to appoint counsel to represent the child if it is in the child’s best interests. Importantly, on Oct. 19, 2022, the Pennsylvania Supreme Court, in the matter of In re KNL, No. CP- 51-AP-0000172-2017, determined that “proper standing inquiry reviews whether a nonfoster-parent third party seeking to pursue a petition to adopt a child in the custody of an agency has a genuine and substantial interest in formalizing a permanent parental relationship with the adoptee-child, which surpasses the interest of ordinary, unrelated strangers.” The Supreme Court also “observed that the legal basis for the ‘general rule restricting standing’ to individuals currently in loco parentis was ‘not apparent.’” Further, it “squarely rejected a purported relationship between the threshold issue of a party’s standing, and the substantive impact of the Adoption Act’s consent requirements … Instead, the Adoption Act contemplates the adoption court … will perform an analysis of a conferred or withheld consent of a relevant party as part of an overall substantive evaluation of the child’s best interests … and this substantive inquiry necessarily follows, but has no relation to, the preliminary inquiry into standing … there is nothing to preclude the trial court from entertaining multiple adoption petitions and then determining the best interests of the child.”  

The Superior Court focused on the fact that the trial court did not take into consideration this recent ruling of the Pennsylvania Supreme Court. In ruling on M.J.G.’s standing, the trial court— in error—focused on the lack of the mother’s consent to M.J.G.’s petition. On this basis, the Superior Court vacated the trial court’s holding that M.J.G. did not have standing, and its granting of E.B.’s petition to adopt.

M.J.G. also appealed on the basis that the trial court never appointed a guardian ad litem and counsel for the child. The trial court failed to make such an appointment despite finding that M.J.G. was the child’s only father figure while he and the mother were in a relationship. The Superior Court also noted that the record reflects that the child had a lifelong relationship with M.J.G. but was less clear about any relationship the child may have had with E.B. The trial court never referenced the child’s view on the competing adoption petitions, or examined whether adoption by E.B. was in the child’s best interests. Additionally, it is unclear as to whether the child was advised as to the implications of the adoption, especially with regard to how it would impact her relationship with M.J.G. or her sibling (from mother and M.J.G.’s relationship). 

Finally, M.J.B. was paying child support and the child may have been entitled to military benefits, yet the trial court did not look into these matters either.

Due to the myriad of significant issues and considerations not addressed by the trial court described above, the Superior Court also remanded the matter to the trial court in order for it to appoint a guardian ad litem and legal counsel for the child to review the above issues and anything else that may arise.

It appears that in making its ruling, the trial court simply did not adequately review all of the applicable facts and issues present in a matter involving two competing and conflicting petitions to adopt. Furthermore, the intervening ruling of the Pennsylvania Supreme Court had direct applicability to the issues and matters raised in this case.

Originally published in The Legal Intelligencer on March 13, 2023 and can be found here.

James W. Cushing is senior associate at the Law Office of Faye Riva Cohen and managing attorney for Legal Research Inc., and sits on the executive committee of the family law section of the Philadelphia Bar Association.

Posted in My Articles: Family Law
08 Nov 2022
1 Comment

James W. Cushing is quoted here: Philadelphia Court of Common Pleas Pulls Back on Remote Proceedings, Sets Deadline

The Philadelphia Court of Common Pleas is scaling back some of its remote technology use, with its three divisions all making moves to hold more proceedings in person.

Both the family and Orphans’ divisions recently vacated pandemic-era orders expanding advanced communication technology use, and First Judicial District spokesperson Gabriel Roberts said modest changes are coming for the trial division as well.

“Some civil judges have had the option of holding their non-jury trials either in-person or remotely,” Roberts said. “There will no longer be a remote option beginning Nov. 1.”

And Roberts said the trial division is not set to enter an order regarding the change, but rather the shift will be a small alteration to how the division operates.

Roberts was unable to say why the Common Pleas Court’s three divisions are revisiting their ACT policies around the same time.

The orders from the family and Orphans’ divisions both say they were entered consistent with the terms of the Pennsylvania Supreme Court’s Order No. 553, which directed the Unified Judicial System to return to pre-pandemic status and fully open and staff the courts, effective July 6, 2021.

Until recently, Philadelphia continued to receive special authorization to suspend state and local rules restricting the use of ACT, but the latest order granting authorization expired Sept. 6.

The family court’s Sept. 28 order, which returned all child and spousal support conferences to in person, appears to bring about the most dramatic shift among the three divisions’ changes. Previously, those proceedings had been conducted exclusively via ACT, per a June 2021 order.

Family lawyers who spoke with The Legal Intelligencer said they were surprised by the move. They said while telephonic conferences have limitations in certain circumstances, they provided greater accessibility to persons who otherwise would have difficulty accessing the court.

“They were really getting a lot of people to respond and to appear because it is by Zoom,” Carolyn Mirabile, a partner at Weber Gallagher Simpson Stapleton Fires & Newby, said. Prior to the pandemic, Mirabile said, Philadelphia saw a high rate of no-shows.

She said face-to-face interaction often better facilitates resolutions, but remote technology is a more efficient option for first-level conferences.

James Cushing, a family lawyer at the Law Office of Faye Riva Cohen, said the typically brief nature of child support conferences makes them well-suited for being conducted over phone or videoconference and he’s disappointed to lose the option.

Like Mirabile, Cushing said the convenience of appearing electronically not only saved time for lawyers but also seemed to prompt better attendance among the parties involved. He reasoned that requiring lawyers and their clients to appear in court for simple conferences will drive up attorneys’ billing and require the parties to miss work.

“For the clients who are paying hourly, representation will now be a lot more expensive for what amounts to a fairly simple and straightforward procedure,” Cushing said. “This sort of diminishes the access to representation for low income clients.”

‘Call Me Old Fashion’

Philadelphia family court spokesperson Martin O’Rourke said the Sept. 28 order, signed by family division Administrative Judge Margaret Murphy, was in response to technological limitations and updated COVID-19 guidelines in the FJD.

O’Rourke said the court still maintained the authority to conduct telephonic conferences. But inefficiencies in remote document sharing and challenges in ensuring both parties could participate ”undermined the court’s ability to establish and enforce support orders, which as a result negatively impacted the court’s performance measures.”

The Orphans’ division Oct. 4 order allowed more leeway than the family division’s, directing that the Orphans’ Court will “resume normal in-person operations” while still allowing individual judges discretion to conduct proceedings remotely so long as they themselves are onsite at the court.

Orphans’ Court Administrative Judge Sheila Woods-Skipper, who signed the order, declined to comment.

Timothy Holman, a trusts and estates lawyer with Smith Kane Holman, said the provision allowing judicial discretion leaves the future of ACT in Orphans’ Court unclear.

“Although I don’t know how any given judge will comply with this order,” he explained, “I suspect that they may continue to have certain procedures such as the call of the audit list, they may hold that virtually.”

Holman said he has appreciated the efficiency that ACT brings, however, he preferred that the  trials and hearings to occurred in person.

“I adjusted very well to virtual trials, but call me old fashion,” he said. “I’m a big believer in-person trials and in-person meetings with other lawyers.”

By Aleeza Furman and published in The Legal Intelligencer on October 7, 2022 and can be found here.

Posted in Citation History, My Articles: Family Law
11 Oct 2022
1 Comment

High Court Determines What a Gift Is in the Context of Divorce

In the matter of Goodwin v. Goodwin, 70 MAP 2021, the Pennsylvania Supreme Court has helped clarify what constitutes divisible marital property in the context of divorce.

23 Pa.C.S. Section 3501(a)(3) states that “property acquired by gift, except between spouses, bequest, devise or descent or property acquired in exchange for such property” does not constitute marital property subject to equitable distribution in a divorce. The issue before the court in Goodwin was whether certain life insurance policies and an individual retirement account fall within the purview of Section 3501(a)(3). As will be described below, the assets described above in this case constitute “gifts” under Section 3501(a)(3) and are excluded from equitable distribution.

The parties in this matter were married on March 31, 1990. At the time of their marriage, the wife had a 3-year-old son from a prior relationship who lived with the parties while they were married. The couple had no children together and the husband never adopted the wife’s son.

Tragically, the wife’s son died when he was only 30 years old. He was single and without any children at the time of his passing. His mother was his only heir. Through his employment as an attorney, the son had acquired four life insurance policies and an IRA account. He named his mother as the sole beneficiary on all of the life insurance policies and IRA. Upon the son’s death, the wife received $633,301.72 from the life insurance policies, and another $3,455 from the IRA. These proceeds were acquired by Wife during her marriage to Husband as her right to the proceeds vested upon the son’s death, which occurred while the parties were still married. The wife did not use any marital asset to pay or contribute to any of the life insurance policies and IRA. The wife never jointly titled any of the aforesaid proceeds from the son, and never comingled any of the funds with marital property and the husband’s property.

Not long after her the son’s passing, the wife initiated a divorce action against the husband. The trial court eventually entered a divorce decree, and determined that neither the life insurance proceeds nor the IRA proceeds were marital property subject to equitable distribution. As a corollary, anything purchased by the wife with the proceeds from her son’s assets were likewise not marital property (e.g., she purchased a home with the proceeds from the son’s assets). In rendering its decision, the trial court noted what is listed above, namely: the wife received the assets in her name only (and the husband is not a beneficiary on any of  the son’s assets). The wife never jointly titled any of the assets, and the husband never adopted the son.

The husband appealed to Pennsylvania Superior Court. The Superior Court agreed with the trial court, but based on a different rationale. Specifically, the Superior Court ruled that the son’s assets were, essentially, gifts to the wife pursuant to Section 3501(a)(3). The husband appealed to the Supreme Court, whose decision is described herein.

In its review of this matter, the Supreme Court first pointed out that as the wife received the proceeds from the son’s assets while she was still married to the husband, these proceeds are presumed to be marital. While Section 3501(a)(3) uses terms like “bequest,” “devise,” and “descent,” the term “gift,” which also appears in Section 3501(a)(3), is not defined. As no definition is given, the court resorted to citing Black’s Law Dictionary that defines “gift” as a “voluntary transfer of property to another without compensation.” Upon its review of the proceeds that the wife acquired from the son, the court ruled that the proceeds were the son’s gift to the wife.

The court noted that the son personally and exclusively funded the IRA and paid for the life insurance policies. By naming his mother the sole beneficiary to these assets, the son created gifts for his mother, contingent on his death, which he intended for the wife alone to receive. In the court’s view, the son’s death merely perfected these gifts to the wife. By virtue of taking the actions described above, the court determined that the son voluntarily transferred his property to the wife without compensation to himself (or his estate), which is, in effect, a gift.

The husband attempted to argue that the son’s proceeds do not fit neatly into established defined categories—like testamentary gifts or inter vivos gifts—and the strict legal requirements of each. The court rejected this argument, saying it is not necessary for the son’s gifts to his mother to fit into pre-existing defined categories, especially considering the common understanding of the term “gift.” In support of this conclusion, the court cited to the case of Smith v. Metropolitan Life Insurance Co. of New York, 71 A.11 (Pa.1908) which relied on that “the naming in a life insurance policy of a beneficiary to whom payment is to be made is a gift of a benefit in future, but is contingent on the circumstances.” The court further observed that voluntarily paying the premiums for the gifted insurance policies is, itself, a gifting action.

The court believes that the exceptions listed in Section 3501(a)(3) (i.e., “bequest,” “devise,” “descent” and “gift”) all have a common element, namely “the intent of the donor to transfer the property in question to only one of the spouses.” The Divorce Code prioritizes the intent to give a gift to one spouse over the general rules of property division in divorce.

As the Supreme Court has now ruled, the matter as to whether life insurance and IRA proceeds from a third party to a married person can constitute a gift to that person is now settled. They constitute gifts that cannot be divided or distributed as marital property in a divorce.

James W. Cushing is senior associate at the Law Office of Faye Riva Cohen and managing attorney for Legal Research Inc., and sits on the executive committee of the family law section of the Philadelphia Bar Association.

Originally published in The Legal Intelligencer on September 26, 2022 and can be found here and reprinted in the Winter 2022 issue of the Pennsylvania Family Lawyer, and can be found here.

Posted in My Articles: Family Law
28 Jun 2022
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Court Clarifies How ‘Pass-Through Income’ Is Considered in Child Support

The Pennsylvania Superior Court, in the matter of Sichelstiel v. Sichelstiel, 2022 Pa. Super. 48, has clarified how so-called “pass-through income” from a party’s businesses is to be considered in a child support matter.

In Sichelstiel the father appealed from a trial court decision that included his pass-through income from his business ventures as part of his net income for the purpose of calculating child support. While he had multiple sources of income, the father only appealed the inclusion of the pass-through income as part of his net income for the purposes of calculating child support.

Over the course of the litigation of this matter, it was revealed that the father owns a minority interest in at least nine different businesses. His pass-through income amounted to approximately $155,000 per year.

In order to avoid corporate tax liability, the various businesses of which the father is minority owner required their individual owners to report their income on the owners’ personal income tax returns. This type of corporate tax avoidance has been dubbed “flow through” or “pass-through” income due to the fact that the income passes through the corporation to the individual tax payer (i.e., in this case, the father).

When examined, the father testified that he used virtually all of the pass-through income to pay the tax liability he incurred due to his receipt of the pass-through income. Consequently, the father argued on appeal that as virtually none of the pass-through income was available for his personal use, it should not be considered when calculating child support.

In its analysis of this matter, the Superior Court first noted that the definition of “income” under the Pennsylvania Child Support statutes includes “income derived from business … and … distributive share of partnership gross income” (See 23 Pa.C.S.S.A 4302). Furthermore, the court acknowledged the well-established case law that “all benefits flowing from corporate ownership must be considered in determining income available to calculate a support obligation.” In saying this, however, the court also acknowledged that it cannot attribute funds “not actually available [as income] or received by the party” as income for the purposes of calculating child support. The court further clarified that there is no “presumption that corporate retained earnings per se are to be excluded from available income for purposes of support calculations.”

The critical issue when it comes to pass-through income is whether someone “is able to control the retention or disbursement of funds by the corporation.” If one has no such control, it is likely not attributable as income.  If someone does have such control, then he has to demonstrate that such actions (i.e., the choice to utilize pass-through income) is “necessary to maintain or preserve the business.” The burden to prove whether one has control, and whether there is a business necessity, is on the person claiming he does have such control. The court limited its ruling by clarifying that pass-through income through corporate distribution can be attributable as income.

Of course, when determining whether a burden of proof is met, a fact finder (e.g., a child support hearing officer) often makes credibility determinations; however, the court made it clear that if the fact-finder does not make a finding on a specific point (e.g., credibility), it should not be assumed that the issue was resolved in favor if the prevailing party. In other words, just because someone wins, it does mean a credibility determination was made in his favor or, to the contrary, if someone loses, it does not mean that person is not credible.

To that end, therefore, in the instant matter, when making his determinations, the child support hearing officer did not make any factual findings, much less credibility determinations. As a result, the trial court erred when it found that the father lacked credibility upon its review of the hearing officer’s decision. The father’s testimony regarding the nature of the pass-through income was not contested by the mother at the hearing, and not investigated by the child support hearing officer. By contrast, the father was able to corroborate his testimony regarding the nature of his income through testimony and presenting various K-1 Schedules for the businesses at issue.

In its analysis of the record, the court found that it contained only the father’s testimony and evidence. As his testimony and evidence was uncontested, the court found that he met his burden of proof. Further, the hearing officer made no finding that the father tried to shield his income to avoid paying support. Instead, the father provided testimony and evidence as to what the pass-through income was, where it came from, and how he used it to satisfy his tax liability. No inquiry was made of the father as to his ability to control the aforesaid businesses’ distributions or whether those businesses had a standard practice to retain earnings, and nothing in the record suggests otherwise. As he had no such control, he had no burden to prove that the retention of these earnings were necessary to maintain or preserve the business, and the court found that the father proved that he did not have any control over whether corporate earnings were distributed or retained. As a result, the pass-through should not have been attributable to the father as income for the purpose of calculating child support.

Finally, the trial court indicated that even if the pass-through income is not attributable to the father as income, it still could have deviated from the child support guidelines on the grounds that the father does not have substantial child custody, which would have led to a similar support order regardless. The Superior Court refused to comment on this as it does not believe its role is to speculate as about possible decisions or abstract legal issues. It can only rule on the facts and law before it, and the actual decisions made.

Thanks to Sichelstiel, practitioners can now have much more clarity as to when, whether, and how to consider corporate pass-through income for the purposes of calculating a child support obligation.

Published on June 23, 2022 in The Legal Intelligencer and can be found here.

James W. Cushing is senior associate at the Law Office of Faye Riva Cohen and managing attorney for Legal Research Inc., and sits on the executive committee of the family law section of the Philadelphia Bar Association.

Posted in My Articles: Family Law

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