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The Process of Subsidiarity

This article is part of my posts on the economic system of distributism.  This is from practicaldistributism.blogspot.com which you can find here:

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Many critics of distributism claim that what we want to achieve would require the expansion of state power and that we really want an all powerful state. What we actually advocate is the decentralization of government power. We want to distribute the various powers of government as close to the local level as can be practically achieved. This is because we promote the principle known as “subsidiarity.” Subsidiarity states that,

“A community of a higher order should not interfere in the internal life of a community of a lower order, depriving the latter of its functions, but rather should support it in case of need and help to coordinate its activity with the activities of the rest of society, always with a view of the common good.”                                      – Pope St. John Paul II

That sounds great, but how would it work?

Subsidiarity goes beyond the typical “states’ rights” argument put forward by the political conservatives of the United States of America. While some in the USA who argue for states’ rights might regard it as a necessary first step to further decentralization of government authority, others voice a “let the states decide” attitude which seems to indicate that their only real objection to certain government laws is the fact that it is the federal government imposing them. Their statements suggest that the same laws would be fine if imposed at the state level without any further decentralization of authority. Listening to some of their arguments seems to give the impression that they don’t really recognize that the centralization of power, even to the state government, makes government less democratic. The more power gets centralized, the more undemocratic the government becomes. They only seem to be concerned when the exercise of power crosses the line from state to federal authority. In reality, however, it is only at the local level that the average citizen really has a voice. Therefore, the more localized the authority, the more democratic the society.

The sad truth is that so many of us have become too accustomed to the idea that the higher levels of government is where problems really get solved. We pay more attention to state and federal elections than to local ones precisely because the authority which naturally belongs at the local level has been usurped by state and federal governments. “I will write my congressman,” and “I’ll take this all the way to the Supreme Court” became the reaction, and the reality, of how we view the political process. While we in the USA believe ourselves to be a bastion of democracy, we have allowed (and assisted) the gradual stripping of our democratic voice. This has gone beyond the making of our laws and the defending of our rights, but even to how we assist those in need. As a society, we have gotten to the point that we automatically look to higher and higher levels of government to resolve even local issues. It is sad, but it seems that most people believe that the higher the level of government, the broader its scope of authority.

Distributism, on the other hand, argues that the higher the level of government, the narrower its scope of authority. The question is how this can be applied in a practical and workable way. While there may be variations in application due to cultural differences in different regions, a basic outline can be presented as a starting point. The foundation of this outline is to understand the “orders of society” and their relationship to each other.

The “lowest” order of society is the family, not because it is the least important but because it is the most. It is the very foundation of society. Above that are religious, occupational and social groups which are free institutions for the mutual support and benefit of their members. The remaining “orders of society” would refer to the different levels of government starting with the local community and moving up from there, each fulfilling only those functions that, by their nature, cannot be fulfilled by the level immediately below it. From the distributist perspective, local issues should be handled as locally as possible. Even if an issue exists across a larger region, each locality should be left to direct how to handle it within its jurisdictional boundary to the greatest extent possible, even if assistance is needed from higher levels of society. This is a fundamental concept to understand about subsidiarity.

When an issue arises that needs to be addressed, the level of society where that issue arises is the natural point where the issue should be addressed. In cases where it cannot be addressed there, the members of that level would petition the next higher level of the orders of society for assistance. Therefore, if a family is in financial need and needs immediate assistance, they should naturally turn to those societal organizations like church, work association (guild) or other social organizations for assistance. If a particular vocation needs a school to provide training in the skills it needs, it should first look to the members of that vocational guild. If it cannot provide for itself, it can look to other guilds of the same vocation, or even discuss combining resources with other guilds to establish schools to meet their combined needs.

It is only if these first attempts cannot resolve the issue that governmental bodies should get involved, and then only by petition of the immediate lower level. If, for example, a lot of families in the community needed assistance and churches and other local associations found themselves unable to adequately provide that assistance, they could raise the issue to the city or to related organizations in other areas. If a city was not able to address an issue, it could ask nearby cities for assistance or raise the issue to the county. In this way, each level of society would render assistance based on the need asserted by the level immediately below it, and that assistance would not usurp any functions of the lower orders of society even if the higher order needs to coordinate the activities of the lower orders due to the nature of the situation at hand, like a natural disaster.

This process keeps as much authority as possible at the local level and, by doing so, preserves the ability of citizens to effectively curtail the usurpation of authority by higher levels of government. Because the greatest level of influence is the most local level, and because the individual citizen’s vote has its greatest influence at the most local level, this process preserves the greatest level of democracy for all.

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Distributism vs. Globalism

This article is part of my posts on the economic system of distributism.  This is from practicaldistributism.blogspot.com which you can find here:

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There has been a tendency over the last several decades toward globalism. This goes beyond the so-called “global economy,” with its free trade deals favoring international banks and corporations. This trend has resulted in the formation of international bureaucracies imposing standards, if not laws, on otherwise sovereign states. While there was always some resistance to this tendency, it has nevertheless progressed to the point that there is now a growing movement of outright rejection. What was initially presented as a path toward peace and harmony is increasingly viewed by common citizens as a growing threat to their freedom and way of life. What is the position of distributism in relation to the idea of globalism?

Globalism is the idea of those who believe they should help direct the development of social, cultural, technological, or economic networks around the world through political influence, and who desire the establishment of international political bodies to govern on an international level. The idea is that, by having multiple people of various cultural and economic backgrounds come together to discuss issues, problems can be resolved effectively and peacefully. Since the resolutions of these bodies can only be effective if they are actually binding, these organizations have to acquire legally recognized legislative authority. This is gladly accepted by the promoters of these organizations who seem to assume that those who run these international legislatures will always see things the same way they do. They hardly ever seem to consider what happens if they don’t. They also don’t seem to care if the policies and laws they desire to establish are actually wanted by the people who will end up being subject to them.

The problem with placing such a wide-ranging authority in the hands of a political body with no political or cultural attachment to the people is that people from different countries have different cultures and customs. They are rightfully proud of them and reject efforts by “those who know better” to toss them aside in the wake of the globalist view of how things should be. They want their own way of doing business, of farming and manufacture, of protecting public health and the environment, of securing civil liberties, of running their schools, of deciding what should be taught in those schools and of deciding how to integrate immigrants into their society. They do not want people who do not share their views of culture and custom to make such decisions for them, and this is precisely what the globalists want to do.

The globalists “negotiate” a one-size-fits-all agreement which actually only appeals to those whose views have a majority representation in the international political organization. In other words, only the globalists really get to decide. This was a significant part of the movement in Great Britain to leave the European Union. The European Union started as a “common market” to work together to help the economies of the separate European countries. It has evolved into an international authority with its own flag, its own anthem, and its legislature makes laws that override the national and local laws of its member states. Even when the decisions of globalist organizations are not legislatively binding, their existence creates a great political pressure for states to comply even if the citizens of the state oppose them. For example, the United Nations not only told Ireland, a sovereign state, that it should change its abortion laws. The politicians in Ireland’s government, led by the U.N. instead of their own people, put it up for a vote. It was resoundingly defeated because the people of Ireland don’t want it. The United Nations even told the Catholic Church to change its religious doctrines according to its view of “child welfare.” There have been cases where globalist organizations have used economic pressure, like denying aide, to try and coerce countries to adopt unwanted policies. By moving the decision-making power further and further away from the people, the political process ultimately becomes less democratic as individual voices become less able to influence decisions that impact their daily lives.

Distributists, on the other hand, would not only promote a country’s sovereign right to direct its own affairs, we also promote that right for political regions and local communities within a country in accordance with the principle of subsidiarity.

“A community of a higher order should not interfere in the internal life of a community of a lower order, depriving the latter of its functions, but rather should support it in case of need and help to coordinate its activity with the activities of the rest of society, always with a view of the common good.”

This view provides a foundation for people to preserve their culture and customs and to direct their own lives, and does so while still making room for national assistance when and where needed. It is not an “isolationist” position. It is a view that does not exclude the idea of international cooperation in addressing wider issues, but it does not include relinquishing of sovereignty to permanent international organizations as part of the process.

The world is filled with various cultures and customs, and the people from those cultures who share those customs either love them or will change them on their own. There isn’t a one-size-fits-all way of life and of doing things. The purveyors of globalism, even if they don’t start out to do so, ultimately trample on the rights of the people they claim to be helping. The people who say we should “celebrate diversity” are the ones who end up trying to force everyone to be the same. The people who shout the loudest about tolerance end up being the most intolerant of all. They believe they are going to do good, but they end up establishing the very kind of repressive government they claim to hate, using the very tactics they villify. In the end, even though they want peace, they will cause rebellion because the people they claim to be helping will resent them for being oppressive overlords.

Following the ‘Wiseman’ Standard in Pa. Custody Battles Is Unwise

Although the so-called Wiseman standard, the standard by which shared custody arrangements were determined, stood for many years, the recent Pennsylvania Superior Court case of P.J.P. v. M.M., 2018 Pa. Super. 100, has officially declared the Wiseman standard obsolete and no longer applicable to Pennsylvania child custody matters.

In the matter of P.J.P., a custody case, the father appealed a decision in the trial court regarding his petition to modify a custody order that he believed was not sufficiently favorable for his custody goals.

The father and the mother are a divorced couple who obtained a child custody order in April 2016. This order granted the mother primary physical custody of the child. In January 2017, the father sought more custody, specifically shared physical custody, and filed a petition to modify.

At the trial, in August 2017, the court made many findings of facts that are directly relevant to its ultimate decision to deny granting shared custody to the father. For example, when the mother has custody she sends the father many photographs and videos and encourages the child to call the father. By contrast, the father does not want to call the mother during his custody times and sends no photographs and videos to the mother. The mother further claimed, and the father admitted, that he has insulted the mother in the presence of the child. He also admitted to telling the child to be sure to look up the instant case on Google Scholar when he is older to know what happened during the case. The mother is also conscientious in ensuring that the father has nice gifts from the child for holidays and such, while the father makes only modest efforts to reciprocate. The parties also had disagreements over the procedure and process for dropping the child off at preschool in the morning. The mother claimed the father refused to get the child ready and just dropped him off at her house, while the father claimed the mother “unilaterally” changed the procedure. Co-parenting counseling was also attempted by the parties. Unfortunately, while the mother was trying to fully invest herself in said counseling, The father refused to meaningfully participate, and the counselor believed the counseling was “not going anywhere.” Of course, the father has a different interpretation of much of the above, but the court made its findings, which favored the mother, after a complete review of the facts, testimony and evidence.

On appeal, the father challenged the denial of shared custody, arguing it was contrary to the best interests of the child. The Superior Court first noted that the trial court made certain credibility determinations that were within its discretion. The court then mentioned that child custody is governed by 23 Pa.C.S.A. Section 5328, which lays out 16  factors for the court to consider when making a custody determination. Superior Court observed that the trial court analyzed each factor and noted that most were either inapplicable or weighed equally for both; however, there were four factors (namely the likelihood to encourage and permit contact with the other party, availability of extended family, attempts to turn the child against the other parent, and the level of conflict and willingness to cooperate with the other party) which weighed heavily on the mother’s side. No factor weighed heavily on the father’s side.

The father argued that the trial court abused its discretion by failing to apply the Weisman standard. In Weisman v. Wall, 718 A.2d 844 (Pa. Super.1998), the court ruled that courts must make four findings when ruling on shared custody “both parents must be fit, capable of making reasonable child rearing decisions and willing and able to provide love and care for their children; both parents must evidence a continuing desire for active involvement in the child’s life; both parents must be recognized by the child as a source of security and love; a minimal degree of cooperation between the parents must be possible.” The father further argued that since he and the mother, in his view, meet the above four factors, shared custody should be awarded.

Superior Court ruled that the father’s reliance on Weisman is misplaced. As noted above, Weisman was decided in 1998 while Section 5328 became law in 2011. The court does not believe the difference between Weisman and Section 5328 is trivial. Specifically Weisman “required the court, before awarding shared custody, ‘to make at least a minimal finding that the parties were able to cooperate before awarding shared custody” while, under Section 5328, the court “must determine the best interest of the child by considering all relevant factors, including but not limited to, ‘the level of conflict between the parties and the willingness and ability of the parties to cooperate with one another.”’

Superior Court noted that the plain language of Section 5328 contradicts Weisman. Unlike Weisman, the court is not obliged to make any specific findings before awarding shared custody. Instead, the court must consider all 16 of the relevant factors, and poor cooperation need not be dispositive. In sum, therefore, Superior Court specifically described Weisman as obsolete.

Finally, the court explained that its citing to Weisman in the recent case of R.S. v. T.T., 1133 A.3d 1254 (Pa.Super.2015) does not belie the above analysis. In R.S., the court used the Weisman factors to supplement its own analysis where it seemed Section 5328 did not appear to lead to a reasonable conclusion in light of the available evidence. Moreover, the court in R.S. never once said trial courts “must” make Weisman findings. Instead, Weismanmerely holds persuasive value as the its factors have been assimilated into Section 5328.

Upon full review of the decision, it appears that P.J.P. has hammered the final nail into the casket of the Weisman analysis. Weisman, for all intents and purposes, no longer appears to be the law for Pennsylvania child custody.

Originally published in The Legal Intelligencer on July 5, 2018 and can be seen here.

Futures Markets and the Absurdity of Capitalism

This article is part of my posts on the economic system of distributism.  This is from practicaldistributism.blogspot.com which you can find here:

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Capitalism is often celebrated by its supporters as the only economic system that can really deliver the goods, the only way of arranging our economic activity that has or that can lift mankind out of its supposedly otherwise inevitable poverty. And it is the case, one must admit, that capitalism does act as a remarkable spur to the manufacture of stuff, all kinds of stuff, sometimes useful, but just as equally useless or even harmful – anything, in fact, that the producer thinks can be marketed. But production of goods, even useless goods, is not the hallmark of capitalism. Rather capitalism, understood as the separation of ownership and work, has as its unique attribute not production, but selling, even, as we are about to see, selling of things that really do not exist.

The human race has always grown or otherwise gathered food, and there has probably always existed some kinds of exchange. But the growing or obtaining of food and the exchange of one desired object for another was always seen as a subordinate part of the life of the human race. Obtaining food was for the sake of living, exchange was for the sake of living better. But with capitalism this common-sense relationship of means and ends is very often perverted. Now all production is for the sake of exchange, social life becomes subordinated to the processes of production and exchange, and they in turn become subordinated to more exotic economic practices. This is because the capitalist imperative is always more sales, more profit, more speculative ways of making money, without any inherent limit or even a notion of what all this activity is for, except for the enrichment of those who own or control the economic processes. Capitalism as the separation of ownership from work creates a class of individuals who are removed from the production of useful objects and who regard the objects produced as primarily commodities to be sold, rather than useful goods to be consumed. Hence the imperative for more sales, ever increasing profits and market share, regardless of demand, because there is no natural limit, no end for which one is striving and with which, when obtained, one is satisfied. Let us look at the interesting example of the futures market in grain and see what we can learn from it as to the nature of the capitalist approach to organizing an economy.

In his book, Nature’s Metropolis: Chicago and the Great West, William Cronon discusses among other topics how the grain trade gave rise to the futures’ market in agricultural products. This account shows the absurdity of economic activity divorced from any rational end, and eventually even from a real product, the purposeless kind of economics fostered by capitalism. As long as something makes money for those who own or control it, capitalism cares nothing for whether the activity actually contributes anything toward meeting mankind’s real needs for goods and services.

Originally, as has generally been the case with mankind, grain grown on the prairies of Illinois and neighboring states was a means of feeding the farmer, his family and his near neighbors. But as it became an item to be shipped and sold, and eventually turned into a commodity future at the Chicago Board of Trade, we can see the transformation of a human and natural object into the abstraction of a commodity, something regarded as merely a means of profit.

A certain amount of grain trading and shipping existed from the early 19th century using water transportation. But this was slow and awkward and did not reach every place. Before there could be a transformation in the understanding of grain, there had to be a more efficient means of transportation. This was provided by the railroads, which were built mostly to facilitate the capitalist imperative to totally commercialize every aspect of life. If people had thought of grain as primarily a food to be consumed pretty much where it was grown, then the huge railroad network of the Mid-West would probably never have come into existence, since the existing modest means of transportation would have sufficed. Thus to extend and fully implement the capitalist transformation of wheat from a food into a commodity, the railway system first had to exist. The building of the railroad network transformed not only food exchange, but the environment, both natural and cultural of the region and the nation. Capitalism, then, both building upon and transforming the human vice of greed, powerfully shaped the entire culture and violently captured such pre-capitalist aspects of society as food production and local exchange and bent them to its purposes.

The existence of the railroad network enabled farmers to conceive of themselves not as growers of food for consumption but as producers of a commodity. Grain was shipped via the railroads to Chicago where it was held in large grain elevators for eventual shipment to the East coast. Originally the ownership of any particular sack of grain was retained by the farmer who harvested it. But naturally sacks of grain differed from each other significantly in quality. The storage of these sacks in grain elevators created a problem: “elevator operators began objecting to keeping small quantities of different owners’ grain in separate bins that were only partially filled…. To avoid that…, they sought to mix grain in common bins.” To do this required some system of grain standardization or grading. After such a system was created it became possible for the elevator owners to contract for sale of a certain quantity of a certain grade of wheat, with no reference to any particular sack of wheat actually existing anywhere. But because of the ever-changing price of grain, sellers and buyers soon realized that they could essentially bet against the future price by contracting in the present for sale or purchase of a definite quantity of grain at some future date, hoping that the price would increase or decrease to their benefit by the time of the actual sale. Ultimately this created the final absurdity:

…futures contracts [which] were essentially interchangeable and could be bought and sold quite independently of the physical grain… Moreover, the seller…did not necessarily even have to deliver grain on the day it fell due. As long as the buyer was willing, the two could settle their transaction by simply exchanging the difference between the grain’s contracted price and its market price when the contract expired. [They] could complete their transaction without any grain ever changing hands…. The futures market was a market not in grain but in the price of grain…one bought and sold not wheat or corn or oats but the prices of those goods as they would exist at a future time. Speculators made and lost money by selling each other legally binding forecasts of how much grain prices would rise or fall.

Grain went from being a means for feeding the population of farmers and others who lived nearby, to being centrally stored in bins in Chicago and shipped throughout the Northeast United States and into Canada, into being merely a symbol, but nevertheless a symbol that enabled speculators to engage in exchange. The contracts themselves have become a commodity to be bought and sold, but the contracts now have no necessary connection with any object of real economic value.

Despite its claim to be the only economic system that can produce sufficient goods to satisfy mankind’s needs, capitalism is really not interested in production at all, except as that can serve sales. It is interested in moneymaking, to be sure, but moneymaking by nearly any means that one can concoct. It might seem obvious, for example, that the financial sector would be a modest adjunct of the more primary economic activities of production or even exchange, sometimes necessary, often helpful, but always subordinate. But frequently someone can make more money by a merger or buyout, which often results in a decrease in real economic activity, than by actual production.

It should be obvious that mankind’s economic activity exists to serve our need for external goods and services. Thus economic activity must always be subordinate to the genuine needs and interests of humanity. But when economic activity is seen as basically a means of getting rich by almost any method, it is apt to become entirely divorced from meeting our real economic needs. The economy becomes essentially a private playground for those with enough skill or money to manipulate it in their favor. Pope Pius XI wrote with regard to such types of economic manipulation, “A stern insistence on the moral law, enforced with vigor by civil authority, could have dispelled or perhaps averted these enormous evils” (Quadragesimo Anno, no. 133). But this is too rarely the case in a capitalist, commercial society, where indeed as Karl Polanyi noted, “society itself becomes an `adjunct’ of the market.”

You can learn more about this issue here.

Death, Divorce and the Division of Property and Estates

When a party dies during the pendency of a divorce matter, a question immediately arises: will the matter be resolved pursuant to the Divorce Code (i.e.: 23 Pa.C.S.A. Section 3323(d.1)) or the Probate Code (i.e.: 20 Pa.C.S.A. Section 6111.2)? While the statutes are fairly clear, there are times where a circumstance still needs to be sorted out by the court. Such a case arose in the Superior Court of Pennsylvania matter of In re Estate of Michael J. Easterday, Deceased, 171 A.3d 911 (2017).

In the Easterday matter, the decedent, Michael Easterday, passed from this life on Sept. 21, 2014, and was survived by his two sons, a daughter and his second wife. About a year before Easterday’s death (Aug. 13, 2013), the wife filed for divorce against Easterday. In or about December 2013, Easterday and the wife entered into a postnuptial agreement in which the parties agreed to waive any and all rights to the pension and retirement plan of the other, including any and all rights possibly available as a surviving spouse or beneficiary. The agreement also specifically states that it would remain in full force and effect without regard to future reconciliation, change in marital status, and entry of divorce decree absent a future written agreement.

 In November 2013, the wife furnished Easterday with an affidavit of consent to divorce pursuant to 23 Pa.C.S.A. Section 3301(c). Not long after, Easterday executed the aforesaid affidavit and returned it to the wife. The wife, for an unknown reason, retained the aforesaid affidavit for approximately six weeks (until mid-January 2014) before providing it to her attorney for filing. Pursuant to Pennsylvania law, an affidavit of consent must be filed within 30 days of its execution (i.e., approximately December 2013). Later in January 2014 the wife proceeded with the divorce and filed for a final decree, but Easterday died before a decree was entered. A decree in divorce was ultimately never entered as Easterday’s affidavit of consent was stale.

Critically, at the time of Easterday’s passing, the wife remained the beneficiary of his pension and life insurance policy. Upon Easterday’s death, the wife immediately withdrew the divorce matter and collected on Easterday’s pension and life insurance policy.

In response to the wife’s petition with the court seeking to compel the wife to preserve and return the pension and insurance money she received. The estate contended that the postnuptial controlled the distribution of the aforesaid funds (specifically that the wife was not entitled to receive them) and Easterday’s designation of the wife as beneficiary of his insurance policy became ineffective pursuant to 20 Pa.C.S.A. Section 6111.2. In response, the wife argued that the postnuptial did not apply as the beneficiary designations were never changed, that 20 Pa.C.S.A. Section 6111.2 did not apply as the affidavit of consent was “stale,” that the parties were reconciling at the time of his death, and because of those reasons, Easterday intended that the wife remain his beneficiary.

After a hearing, the trial court ruled that the estate was entitled to Easterday’s pension, as it was addressed in the postnuptial, while the wife could retain the life insurance proceeds as they were not addressed in the postnuptial. Both parties filed exceptions, which were unsuccessful, leading to appeals by both parties to Superior Court which issued the decision described herein.

23 Pa.C.S.A. Section 3323(g), which is part of the Divorce Code, states: “(g) Grounds established . . . (2)  In the case of an action for divorce under section 3301(c), both parties have filed affidavits of consent or, if the presumption in section 3301(c)(2) is established, one party has filed an affidavit of consent … (3)  In the case of an action for divorce under section 3301(d), an affidavit has been filed and no counter-affidavit has been filed or, if a counter-affidavit has been filed denying the affidavit’s averments, the court determines that the marriage is irretrievably broken and the parties have lived separate and apart for at least one year at the time of the filing of the affidavit.” In the Probate Code, 20 Pa.C.S.A. Section 6111.2(a)(3)(ii) states “this section is applicable if an individual … dies during the course of divorce proceedings, no decree of divorce has been entered pursuant to 23 Pa.C.S. Section 3323 (relating to decree of court) and grounds have been established as provided in 23 Pa.C.S. Section 3323(g).” When evaluating the applicable law mentioned above, the court raised Pa.R.C.P. 1920.17 as also applicable herein. Rule 1920.17 prohibits the withdrawal of a divorce (and its economic claims) if divorce grounds have been established and the Estate does not the consent. While the aforesaid Rule directly applies to 23 Pa.C.S. Section 3323, the court opined that the Rule should also apply to 20 Pa.C.S.A. Section 6111.2(a)(3)(ii) as it would be inappropriate to allow a surviving spouse the power to negate 20 Pa.C.S.A. Section 6111.2(a)(3)(ii) by simply discontinuing the divorce action unilaterally.

In reviewing the underlying facts of this matter, the court took note of the fact that the affidavit of consent was not filed within thirty days of its execution. As a result, the lower court determined that divorce grounds were never established. Although the Estate argued that the lateness of the affidavit does not negate what it argued was an intent to consent to the divorce, the court, relying on public policy considerations, ruled that a strict compliance with the Divorce Code is required. In the court’s view, the integrity of the family is to be protected and the seriousness of the dissolution of marriage warrants strict compliance with the deadlines and requirements laid out in the statute. Indeed, the court pointed out, the establishment of divorce grounds takes on an added significance when, not only is the dissolution of a marriage at issue, but, in this case, it would also determine whether the Divorce Code or the Probate Code applies. Furthermore, the court observed that Easterday had an extended opportunity of several months to rectify the “stale” affidavit before his passing, but chose not to do so. Based on the above, the court ruled that a “stale” affidavit of consent is insufficient to establish divorce grounds, especially in a matter where it is, in its estimation, far from clear that the decedent possessed an intent to divorce at the time of his death.  As a result, the Probate Code controls this case.

Ultimately, the court, applying 20 Pa.C.S.A. Section 6111.2, ruled that Easterday’s beneficiary designation on his life insurance is, therefore, valid, and the wife may retain the proceeds from the same.

In opposition to the estate’s arguments, the wife asserted that Easterday made a deliberate and conscious choice to give his pension to her through an irrevocable election that she be his beneficiary. Of course, the above is in direct conflict with the postnuptial, which, by its terms described above, definitively prohibits the wife from being such a beneficiary. The estate pointed out that the postnuptial was executed after the beneficiary election was made.

In reviewing the above, the court first noted that spouses may waive their right to the pension of the other if the waiver is specific. In its estimation, the postnuptial in the instant matter was clear and unambiguous, therefore its terms, namely that the wife waived her right to Easterday’s pension without regard to reconciliation, which could only be changed by a subsequent signed agreement, applies hereto.

Perhaps the most significant legal challenge to the postnuptial was the requirements of the Employment Retirement Income Security Act (ERISA). Pursuant to ERISA, a pension must be administered, and the proceeds therefrom distributed, according to the terms of the plan documents, and not alternative agreements, such as a postnuptial agreement. While acknowledging the applicability of ERISA to the pension in this matter, the court also indicated that, although ERISA may require the pension to be distributed to wife, the terms of the postnuptial can also apply by requiring Wife to turn over to the estate any and all sums she receives as a pension beneficiary.

In the end, the court entered a Solomonic decision to cut the pension “baby” in half: the wife can keep the life insurance policy proceeds while the estate is to receive from the wife the pension proceeds she received.

Originally published on December 26, 2017 in The Legal Intelligencer and can be found here and was reprinted in the Pennsylvania Family Lawyer for its March 2018 edition. (see here).

Vacant Property is Irredeemable after Sheriff Sale, Commonwealth Court Rules

If one wishes to take advantage of his right to redeem a piece of real estate subsequent to a sheriff’s sale, it is critical to act in a timely manner, otherwise one may miss the opportunity to do so.

53 P.S. Section 7293 lays out the time line to take action in redeeming a property; however, there was some ambiguity in precisely interpreting just when the deadlines occur. The Court, in the recent matter, and case of first impression, Brentwood Borough School District v. HSBC Bank USA, 111 A.3d 807, helped clarify some of the aforesaid ambiguity.

In Brentwood, Defendant HSBC is the mortgagee on a property which was sold at sheriff’s sale to a third party called Grove Properties, Inc. due to delinquent taxes. Within about five months, HSBC filed to redeem the property pursuant to 53 P.S. Section 7293(a). According to 53 P.S. Section 7293(a), a party must file to redeem a property within nine months from the date of the acknowledgment of the Sheriff’s Deed which conveys a property following a sheriff’s sale.  The trial court ruled against HSBC on this issue, asserting that HSBC only had ninety days to file to redeem, however on appeal the Commonwealth Court realized the trial court mistakenly applied the time line laid out in 53 P.S. Sections 27101-27605, and reversed the ruling of the trial court and confirmed the nine month time period.

The primary issue the Court focused upon was whether the property was vacant pursuant to 53 P.S. Section 7293(c), which made the case one of first impression. Section 7293(c) states that “there shall be no right of redemption of vacant property by any person after the date of the acknowledgment of the sheriff’s deed therefor.” Defendant argued that the property was not vacant because the occupant of the property at issue only temporarily stayed at her friends’ house to save money. She also left her belongings at the subject property. Based on the above, the Defendant asserted that, at most, the occupant of the property was only temporarily absent from it, which does not constitute its vacancy, as a property cannot be vacant if its occupant intends to return. In support of its argument, Defendant cited to how the term “occupied” is used in other cases and statutes.

The Court ruled that the term “occupied” must first be interpreted in the context of the Municipal Claims and Tax Liens statute (i.e.: 53 P.S. Section 7101 et seq). Pursuant to that statute the occupancy must be as a residence and not as a storage unit. Per the Court, the purpose of the statute is to increase the collection of taxes and to free land to bear its share of the tax burden. As a result, the Court reasoned, the statute must be interpreted to take consideration of the ability of the municipality to convert a house sold at sheriff’s sale back to productive use as quickly as possible.  Therefore, the Court deduced that the legislature intended the redemption period should be brief which, in this case, is nine months’ time.

The Court observed that “occupied” is a factual determination to be made and applied on a case-by-case basis. The factors to consider in looking at a case include: “whether anyone was habitually physically present at the property, i.e., regularly sleeping and eating there and using it as a place to dwell; whether any lack of physical presence was due to temporary illness, travel or renovation; whether the property was unsecured, damaged or uninhabitable; and whether the basic and necessary utilities such as water, electric and gas were operational.” The instant matter revealed a property which had no person habitually present in it before the sale. It had no running hot water or gas and, therefore, no means to bathe or cook, essentially making it uninhabitable.  Further, it also revealed that the occupant simply could not afford to reside at the property any longer. As a result, the Court resolved that the property was unoccupied. As the property was unoccupied, Defendant could not redeem the property after the date of the acknowledgment of the sheriff’s deed under the statute.

In light of the above, Defendant argued that disallowing them from redeeming the property was unjust as it “could not reasonably be deemed to be on notice that while [the occupant] kept all her belongings at the Property and frequently returned to the Property that she would later claim that she did not reside there anymore, and Defendant would suddenly be precluded from redeeming its interest in the Property.” The Court was not convinced. The Court was satisfied that the Defendant received all required statutory notices under the applicable law.

In sum, the Court ruled that the statute at issue is designed for a speedy and efficient process to return a property sold at sheriff’s sale to productive use and a property with no working utilities and no one physically inhabiting the property is vacant (or unoccupied) despite the occupant’s intention to move back in or leaving her belongings in the property.

Originally published on October 3, 2017 in Upon Further Review and can be viewed here.

A Collection of Family Law Writings by James W. Cushing, Esquire

Over the course of my career, I have written extensively on a wide variety of family law issues and legal principles.  These writings have been published in The Legal Intelligencer, Upon Further Review, and The Pennsylvania Family Lawyer as well as posted onto my blog.  I have collected these articles and blog posts and have listed them below.  Thanks for reading!

Articles:

Musings:

Enforcing Marital Agreements According to the Law of the Case

In the matter of Bienert v. Bienert, 2017 Pa.Super. 255, Case No. 17-1288 (Pa. Super. Aug. 7, 2017), the Superior Court of Pennsylvania has clarified the enforceability of marital property agreements (MSA) executed prior to the filing of a divorce but entered into while the husband and wife were separated.

As mentioned above, while the MSA was executed by the parties while they were separated, it contained rather precise language as to how their marital property is to be divided in the event of a divorce. Specifically, the MSA indicates that it “settles all rights of the parties” and, indeed, “is not contingent upon either party of both parties being granted a divorce,” but would be “made part thereof” in the event of a divorce.

After the husband filed for divorce, the wife filed a petition for alimony pendene lite and was represented by counsel when she did so. The husband opposed the aforesaid petition, arguing that the MSA was a complete and final settlement of all obligations and, as it does not allow for alimony pendente lite, the wife should not be allowed to collect it. In response, the wife argued that as the MSA does not specifically refer to alimony pendente lite, she is able to collect it. Notably, the wife did not argue that the MSA was invalid for any reason, she merely advanced an interpretation of its language. Ultimately the trial court denied the wife’s petition on the basis that the MSA is a complete and final settlement of all claims, including alimony pendente lite and no provision allowed for its collection. The trial court pointed out that “absent fraud, misrepresentation, or duress, spouses should be bound by the terms of their agreements.”

After failing to receive alimony pendente lite, the wife’s attorney withdrew his appearance on her behalf, which led to the wife filing multiple petitions to enforce the MSA regarding various provisions of property division. The Superior Court observed that all of the wife’s various petitions “were premised on the view that the Agreement was valid and enforceable.”

Separately, the husband eventually filed a petition to hold the wife in contempt for violating the terms of the MSA. In response to the husband’s petition, the wife raised defenses claiming that she executed the MSA under duress as the husband requested the wife to execute the MSA immediately after the wife had been sentenced in court for three felonies and charged with a misdemeanor and was “in rehab.” This was the wife’s first mention of duress, despite her efforts to enforce the MSA previously as described above. Indeed, even when arguing duress, she made no argument that the MSA was invalid. A short time after the husband’s filing of the contempt petition, and the wife’s filing of defenses, as described above, the wife filed a contempt petition asking for the enforcement of the MSA.

At the hearing for the above petitions, the wife raised arguments to avoid the terms of the MSA on the grounds of mistake, misrepresentation or duress. She now further claimed that she did not know the MSA applied to her divorce, allegedly believing it only applied to her separation. The trial court ruled against the wife. Thereafter, the wife hired a new attorney who filed a new petition to void the MSA for the reasons set forth above. The court subsequently denied the wife’s petition and went ahead and entered a decree in divorce. In response, the wife appealed, which led to the opinion described herein by Superior Court.

On appeal, the wife again argued that she executed the MSA against her will and that a mutual mistake of fact existed, both of which warrant the voiding of the MSA. Furthermore, as an aisde, the trial court did not hold an evidentiary hearing on her last petition which, the wife argued, was unfair as it did not give her a full opportunity to litigate her economic claims. Superior Court affirmed the trial court. In ruling against the wife, Superior Court relied on the law of the case doctrine and equitable estoppel.

The law of the case doctrine is one that “expresses the practice of courts generally to refuse to reopen what has been decided … in order to protect the settled expectations of the parties; to ensure uniformity of decisions; to maintain consistency during the course of a single case; to effectuate the proper and streamlined administration of justice; and to bring litigation to an end.” In addition, the doctrine applies, for the most part, specifically with respect to a court adhering to prior decisions within the same case. In other words, although multiple petitions may be filed in a given case, they are essentially cumulative and are not evaluated in isolation from the rest of the case. While the doctrine does not disallow a court from reconsidering prior decisions within case, it is certainly within its appropriate discretion to refuse to do so in order to maintain consistency and uniformity.

Equitable estoppel functions very similarly to the law of the case doctrine. Pursuant to estoppel, “a party to an action is estopped from assuming a position inconsistent with his or her assertion in a previous action, if his or her contention was successfully maintained.”

In applying the principles above, the court noted that the wife has taken inconsistent positions regarding the MSA throughout the litigation of the divorce matter. Sometimes she sought enforcement of it and, indeed, did so successfully at times. Other times she filed for husband’s alleged contempt of it. Still, at other times, she argued it should be void or unenforceable or was the result of mistake or duress. The case was litigated for a year and a half before the wife began questioning the validity of the MSA despite the fact that multiple other petitions were filed and argued assuming its validity. As she attempted to enforce the MSA, without questioning its validity, and the court ruled on the same, she cannot now, suddenly and late in the litigation, change course and argue that the MAS is somehow unenforceable. Not only have prior court rulings been made on the good faith of the wife’s arguments, her suddenly raising directly inconsistent arguments undermines the legitimacy of her prior arguments and the rulings thereon. Furthermore, it puts the husband into an untenable position of committing to arguments against the wife that he may not have advanced in light of the wife’s sudden reversal. It was clear the wife raised her new arguments due to her lack of success with her prior arguments.

Ultimately, then, it is vitally important for litigants and practitioners to settle on a theory of a case and adhere to it throughout as, otherwise, the court, and certainly the other party, will take notice of a party raising inconsistent and mutually exclusive arguments later in the litigation of a case as compared to its beginning. Obviously while new information is typically learned and discovered during litigation which can legitimately result in modifying one’s arguments, the position or posture of a party to an essential and known element of case, say the enforceability of a marital agreement, is something that needs to be established early on, and there is limited ability to change or reverse course once a party commits to one.

Originally published on October 3, 2017 in The Legal Intelligencer and can be found here and reprinted in the Pennsylvania Family Lawyer for its October 2017 edition (Volume 39, No. 3) (see here).

Distributism and Large-Scale Industry

This article is part of my posts on the economic system of distributism.  This is from practicaldistributism.blogspot.com which you can find here:

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Thomas Storck’s recent article about the antagonistic relationship between owners and workers prevalent in capitalist enterprises included the following statement. “The activity of the Mondragon cooperatives in Spain proves that there is no reason why large-scale and highly technical industrial operations cannot be worker owned.” This sentence prompted a reader to respond with a request.

“Please provide a follow up article showing how this system works for Mondragon, their profit, employee take home, growth, etc…”

This response to that request will address two things. I will first provide the information requested, then I will address the case of Mondragon and how it does, and does not, relate to distributism.

Mondragon started as a technical college, founded by Father José María Arizmendiarrieta in 1943. Its first cooperative was established with 5 workers making paraffin heaters in 1955. Today, Mondragon is a cooperative federation comprised of over 250 companies and 74,000 workers operating in the finance, industrial, retail and knowledge sectors. Mondragon’s sales in 2014 were €10,985 million (US $12.48 billion). They put €145 million (US $164 million)  in research and invested €345 million (US $392 million). They have 15 technology centers, 1,676 researchers and have filed 479 patent families.

I don’t have specific information on employee take-home, but each company agrees to set its own wage ratio within an agreed upon range of 3:1 to 9:1. The average is 5:1, meaning that the highest paid person in a given company typically makes no more than five times what the lowest paid person in the same company does. The result of this is that the workers doing non-management jobs at Mondragon typically make 13% more than similar local jobs outside of its structure. Most workers make well above the minimum wage since they are employed in jobs requiring high levels of skill and technical training, Mondragon’s managers do earn less than those outside of its structure, but this is because they agree that Mondragon’s model is better than the typical corporate model.

Only 103 of Mondragon’s 260 companies are cooperatives. This in itself does not make it incompatible with distributism. I don’t have any details about the other 157 companies, like whether they are small, independently owned businesses. The ideal of distributism is that everyone own the capital used to earn his living, but we accept that this ideal may never be fully achieved. Some people may just prefer prefer to be employees, or may have to work as employees for some time before they can become owners. Distributism does not require that every shop be a worker owned cooperative, but those that are not would tend to be small local shops, and I don’t know the extent to which this is the case for those Mondragon companies that are not cooperatives.

The original cooperative established with five members back in 1955 grew to become Fagor Electrodomestics, the largest company in Mondragon’s federation. The Fagor brand is currently present in 100 countries, employs more than 12,000 people in 17 countries and operates 16 factories in 3 continents. Due to mismanagement, it had to declare bankruptcy in October 2013. The economic articles from capitalist pundits seemed to hardly contain their glee at what they perceived as the fall of the greatest example that methods other than their own could work. The Economist declared that “one of the group’s key principles—of solidarity among its 110 constituent co-ops—has found its limit.” Actually, what had reached its limit was the federation’s willingness to extend another loan to prop up Fagor when it had no plans which would resolve its problems.

Before crowing so loudly, capitalist economists should have waited to see the reality of this commitment and how it compares to what happens when the typical capitalist enterprise goes bankrupt. The reality of Mondragon’s commitment to worker solidarity is revealed by what the federation actually did regarding the workers of Fagor. Mondragon’s social mutual, Lagun Aro, proposed a 1.5% raise in contributions from all members at the next General Assembly so it could provide needed unemployment benefits to displaced Fagor worker-owners. They received 80 percent of their salary while Mondragon identified new positions for these workers. Compare this to the layoffs we’ve all seen reported when large capitalist employers go bankrupt or have to restructure to avoid bankruptcy.

This clearly shows the dynamic vibrancy and resilience of the cooperative model even when operating with large-scale, multi-national, highly technical industrial operations. This is why various cooperative organizations, the p2p economic movement and distributists all can validly point to Mondragon as an example of how well the cooperative model truly works.

When it comes to distributism, however, my opinion is that we need to be more carefully nuanced when using Mondragon as an example. It has grown to a size and scale of operation beyond that which distributists actually promote and which goes against the preference for local or even regional economics to the international model touted today. We are not in any way against international trade, but individual corporations employing thousands in multiple countries seems to me to go against our economic model, and Fagor is an example of why. The description of how Mondragon handled the bankruptcy of Fagor should not be taken as a claim that it wasn’t an issue for the federation. The mismanagement of Fagor not only impacted its thousands of employees, but the entire Mondragon organization. The fact that it was able to come up with a solution that maintained its commitment to worker solidarity does not mean that this was an easy solution or that it did not put significant strain on the people or the finances of Mondragon as a whole.

In the past, Fagor might have been held by some to be the shining example of Mondragon’s success because it was the largest company with the most employees, but that is looking at the organization from a strictly capitalist perspective. What happened in the wake of Fagor’s bankruptcy shows that the many smaller cooperatives and the overall commitment to worker solidarity are the mark of Mondragon’s success. They helped to support Fagor with the loans it received before the final straw that resulted in its bankruptcy. They supported the workers displaced when Fagor failed. Democratically based worker solidarity is at the very heart of the cooperative movement, and also at the very heart of the guild structure distributists promote.

It is clear that the cooperative model works and this is why distributists propose this model for large scale operations, particularly those which only make sense at a more regional rather than local level. Of course, cooperatives also work at a local level and we promote that as well. 

I hope this article fulfills the request of our reader.

You can learn more about this issue here.

Dependent on Child Support in Dependency

It is widely known that it is public policy is to ensure children receive the support they need from their parents. In the vast majority of cases, a child support obligation terminates when a child reaches the age of majority (age 18) or graduates from high school, whichever is later, however, the Superior Court of Pennsylvania, in the recent matter of Somerset County Children and Youth Services v. H.B.R., 155 A.3d 627 (Pa. Super. 2017), has addressed the atypical situation when a child reaches the age of majority yet still remains subject to a dependency order.

In H.B.R. the child-at-issue was put into placement following a dependency action. Consequent to the same, Children and Youth Services (CYS) filed a complaint for child support against the child’s father and, accordingly, an order for child support was entered. A little over two years after the child support order was entered, the father filed a petition to modify the child support order, requesting termination of the same, because the child, having reached the age of majority and graduated from high school, was emancipated. Despite reaching the age of majority and graduating from high school, the child voluntarily chose to remain in the custody of CYS until age 21, which is his right to do.

After the child support modification conference, the trial court entered an order terminating the child support order as the child is emancipated due to reaching the age of majority and graduating from high school. In response, CYS demanded a hearing contesting the termination of the child support order because, although having reached the age of majority and graduating from high school, the child continued to be dependent and in the custody of CYS and, therefore, financially subsidized by CYS. After the hearing mentioned above, the trial court affirmed the order mentioned above flowing from the conference terminating the support order. As a result, CYS appealed the matter to Pennsylvania Superior Court.

On appeal, CYS essentially argued that as it must still outlay money for the support of the child, due to his remaining dependent, the father should contribute to the same through a child support order. Furthermore, CYS claimed that the child support process may be the only mechanism available to it to seek recoupment of its costs for the emancipated child.

In rendering its decision, the court first noted that the Pennsylvania Supreme Court has ruled that a parent has no legal duty to provide educational support to an emancipated child. Based on this, Superior Court, specifically agreeing with the trial court, said that “a parent has no duty in Pennsylvania to provide support to a college-age child who has graduated from high school and who suffers from no infirmities which would prevent that child from earning income to help support himself.”

In light of the above, the court ruled that CYS failed to convince it that the trial court’s order, described above, is “manifestly unreasonable or based on bias, ill will, prejudice and partiality.” Instead, the Superior Court noted, the trial court’s order is precisely consistent with applicable law, especially considering that the child is emancipated and capable of self-support. Therefore, the father has no legal obligation to continue paying child support.

As part of its analysis, the court distinguished this case from the matter of Erie County Office of Juvenile Probation v. Schroeck, 721 A.2d 799 (Pa. Super. 1998). In Schroeck, the parent was obliged to pay the cost of care for the child-at-issue in that case even though the child was over 18 years old and graduated from high school and therefore emancipated. Despite meeting the two primary factors for emancipation, the child was also adjudicated delinquent and placed in a court-ordered residential program. In ordering support for this child, the court’s reasoning in Schroeck was that, due to being adjudicated delinquent and in a residential program, the child was rendered effectively unemployable and incapable of self-support. By contrast, the Superior Court noted, the child in H.B.R. has no such limitations which would trigger a support obligation. The court pointed out that his decision to remain in the custody of CYS is not mandatory and does not render the child incapable of self-support.

Ultimately, Superior Court affirmed the termination of the father’s child support obligation. The court observed that CYS may have other avenues to pursue under 62 Pa.C.S. Section 704.1 and an action to seek reimbursement due to the child being able to engage in self-support, but elected not to provide any guidance as it does not issue advisory opinions.

Originally published on June 29, 2017 in The Legal Intelligencer and can be seen here and reprinted in the Pennsylvania Family Lawyer for its October 2017 edition (Volume 39, No. 3) (see here).

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