Dispute & Resolution – June 27, 2019

She’s moving out …

Background

Stephanie and Steven have been married for 19 years and have two sons ages 8 and 6. Steven is an unsuccessful artist and Stephanie is a physician’s assistant. Steven works from home and admits that he has treated his career as an artist more as a hobby than an occupation, he hasn’t earned minimum wage for several years. Stephanie works at a hospital as a physician’s assistant and is the family breadwinner.

Her wages net $8,000 per month. Stephanie works six hours a day on Monday, Tuesday and Thursday; she works a 12-hour shift on Wednesday and is off on Friday, Saturday and Sunday.

Stephanie and Steven agree to share time with their children on a 50/50 basis and they agree Steven should stay in the house because his studio is in the house.

Discussion

Stephanie and Steven met me at my office. They cooperatively told me about their careers, their children and their home. At the time of mediation, they were still living together.

Their debts include a $500 per-month car payment, a $1,500 mortgage payment and credit card debt of approximately $10,000. Steven and Stephanie have separate savings accounts with $30,000 and $8,000, respectively.

Steven suggested a parent time schedule of one week on and one week off. After discussion of the pros and cons of such a schedule and brainstorming other options, the parties agreed their sons would be with their mother every Monday and Tuesday and every other weekend, and with their father every Wednesday and Thursday and every other weekend. They would share holidays according to Utah statute unless they agree otherwise and they will each have the children for two uninterrupted weeks each summer. They also agreed on a co-parenting plan.

Stephanie’s child support obligation would be about $700 per month. According to Utah statute, in addition to child support, parents are supposed to share equally the cost to provide health insurance and uninsured medical expenses for their children. Stephanie agreed to pay 100% of the cost of the children’s health insurance and uninsured medical expenses. Additionally, according to Utah statute, parents are supposed to share equally work-related childcare.

During the summers their children attend day camps at the Natural History Museum and the Aviary. Steven and Stephanie agreed their sons enjoy their camps, however, Steven voiced concerns about his ability to pay for half of the cost for the camps next summer. After discussion, they agreed to pay an amount proportional to their income.

We next discussed finances. The $10,000 credit card bill makes Stephanie very uncomfortable. Each month she makes the minimum payments and sees those payments as throwing away money. To make matters worse for her, the credit card is only in her name. After a lot of discussion Steven and Stephanie agreed to pay one-half of the credit card debt out of their respective savings accounts when the next bill is due, after which, Steven will be removed as a user.

The other two debts to address are the mortgage and the car payment. The car payment is for the vehicle that Steven uses; the vehicle Stephanie uses has been paid off. Steven wants to stay in the house because that is where his studio is located. Stephanie agrees Steven should stay in the house. At this time, Steven has insufficient earnings to take over the car payment and the mortgage payment. It is his intention to aggressively pursue his career as an artist and hopes to have a living wage within the next 12 months. Stephanie offers Steven encouragement and praises his talent.

In the short run, Steven has need of alimony. Rather than paying alimony, Stephanie agrees to make the car payment and pay for its insurance until the car is paid off in about 36 months. She will also pay for their joint telephone plan for the next 36 months. The value to Steven is about $700 per month.

Both Stephanie and Steven are concerned about Steven losing his health insurance when their divorce is final. Securing health insurance for Steven, even under the Affordable Care Act, is cost prohibitive.

Stephanie has a sizeable retirement account that she would like to keep. Steven agrees to forego any claim on Stephanie’s retirement account in exchange for all of the equity in the house, all of the money in his savings and checking accounts and all of his artwork. Stephanie agrees to Steven’s proposal.

Stephanie and Steven agreed they could divide the contents of the house amicably.

With no other issues to resolve, I drafted the agreement. I discussed the importance of seeking legal counsel before signing the agreement. They each said they had spoken to their own attorneys before coming to mediation, and they wanted to leave with a signed agreement. Accordingly, they both signed the agreement.

After the agreement was signed, they asked if they were now obligated to file for divorce. I told them the agreement did not obligate either of them to pursue a divorce, however if either did, the terms of the agreement are enforceable.

Resolution

They are going to delay filing for divorce. Instead they are going to separate and implement the terms of their agreement. Stephanie is going to move into an apartment near their home in the next two weeks, at which time they will begin their parent time schedule. Stephanie will continue to provide health insurance for Steven through her work. They agree they each need to have their own space and they will decide later whether or not to divorce.

Mediator Notes

The time spent in mediation was 3.5 hours at the hourly rate of $250.

If you have a dispute you would like me to consider in this column contact me at 801-994-6000 or [email protected]