The purpose of a divorce, aside from determining parental responsibilities if there are children involved, is to divide marital property and marital debt. This blog does not discuss experts with regard to parental responsibilities such as the Child and Family Investigator (CFI) or the Parental Responsibilities Evaluator (PRE), which will be the subject of a future blog.
Whether there is a settlement by the parties or a hearing before the court (a “permanent orders hearing”) property and debts must be valued before they can be divided.
The parties, or the court, need solid, verifiable and reliable information regarding value. Colorado law requires the court to divide marital property and debt “equitably”, which means in a fair manner, under the circumstances. This does not always mean an “equal” division, but, if the circumstances do not call for it, most courts will strive for an equal or near equal division.
In order to obtain reliable information on value parties, attorneys and the court rely on experts. Attorneys are experts in the law, not in appraising property or determining earning capacity. It is much more cost effective to hire experts for this task and their reports are taken very seriously by the court.
The three most common types of experts are real estate appraisers, business appraisers and vocational rehabilitation experts. If the parties own special types of property, then appraisers who specialize in vehicles, art collections, stamp collections, antiques, firearms or other types of property may be used. A forensic accountant might be necessary in some circumstances, such as complex financial situations or businesses.
Real estate appraisers provide a current market value of real estate which can be used to determine the value of equity to be divided between the parties, or for the purposes of a “buy out”. In some situations, of equal importance is a date of marriage value of real estate, if such property was owned prior to the marriage. Some real estate appraisers can also offer a value as of a certain date in the past. This information is the basis of determining the martial versus separate property value of real estate.
Vocational experts will analyze a person’s education, experience and abilities, and apply those findings to current trends in the local employment market in order to produce a report providing an expert opinion on a person’s likely profession, wage and ability to earn in the future. This information is invaluable when the parties consider a fair settlement, or if the court must determine maintenance.
Without expert reports the parties and the court are left with the task of unravelling large amounts of documentary evidence and/or testimony, which could be hearsay, or scant to no evidence, in order to sort out the value of property or the ability of one or both of the parties to earn a living. This makes the task of reaching a fair settlement or the court’s task of dividing property extremely difficult and can result in an unfair division.
In short, expert reports are absolutely invaluable to parties trying to reach a settlement or the court in dividing property and determining maintenance. You should seriously consider the cost and benefit of expert reports in your divorce, and the professionals at Toussaint & Coaty can help you through every step of the process.
You’ve worked hard to build your business and you’re proud of what you’ve done. Maybe now the time has come to let someone else take over the work. Or perhaps you’ve received an offer you just can’t turn down. If you are facing the prospect of selling your business, it is important to have competent counsel on your side. Whether the sales price is Ten Thousand or Ten Million dollars, Toussaint & Coaty can provide you the representation you need.
The buyer and seller will have to answer many questions about how to structure the transaction. Who, exactly, are the buyer and seller? What, exactly, is being sold? Is the buyer purchasing only the assets of the business? The buyer could be purchasing the operating entity (corporation, LLC, etc.) in addition to the business assets. If the buyer is an experienced businessperson but is not specifically experienced in your industry, you may want to stay on with the business as an employee or consultant. In that case, you will need a contract with the buyer to govern that relationship and the rights and obligations you owe each other. Whether you stay with the business or not, your employees will also need to be considered. The buyer will likely need to know their identities, their compensation and benefits, and their qualifications. An attorney can help you clarify the scope and possible consequences of this sale.
A savvy or sophisticated purchaser will want to conduct a due diligence examination of the business’s finances, contracts, licenses, governing documents, insurance, and many other important aspects of the business and its operation. Attempting to comply with the seemingly never-ending requests for documents can be overwhelming when you’re also trying to operate your successful business. While you, as seller, have the ultimate obligation for producing those documents, an attorney can help guide you and keep you on track.
If you are leaving the business entirely but aren’t ready to get out of the industry, the buyer may expect you to sign a non-compete agreement. Colorado allows such agreements to be enforced, but there are limits to their duration and scope. It is important that you review such an agreement with your attorney. Non-disparagement clauses or agreements are also common items included in business sale contracts. You need to understand the limits those agreements place on your ability to discuss the business and with whom.
Finding a buyer or receiving an offer for your business is only the first step. Even agreeing on a purchase price and closing date is only the beginning of a potentially lengthy process. If you are interested in or already in the process of selling your business, contact the attorneys at Toussaint & Coaty today for our experience and expertise.
The Tax Cuts and Jobs Act of 2017 was signed into law on December 22, 2017. The Act is a significant change to previous tax laws that will affect individuals, businesses and tax-exempt organizations. The new law will also affect divorcing individuals in the state of Colorado. The major change in the Internal Revenue Code affects maintenance, also called alimony in some states, which now will not be tax deductible for the paying spouse. Instead, this payment from one spouse to the other must be paid on an after-tax basis. There is no doubt this will place an increased tax burden on the paying spouse and some argue it may also make the amount of the maintenance and its determination more difficult to calculate. Under the previous law, maintenance payments were tax deductible for the paying spouse. The payments always were and will continue to be income to the receiving spouse requiring the payment of any taxes on that income. Maintenance is determined by statute in any dissolution case but now the Court must take into account the payor’s tax burden as well as the receiving soon-to-be ex-spouse’s income and needs.
An important element of estate planning is ensuring that your final wishes remain up to date. The very most important element is having your final wishes in writing. The first step in appropriate estate planning is having a will drafted. You should carefully consider not only how you would like your property and assets distributed, but also how state law will permit you to do so. A carefully drafted will should comply with state law and also accomplish your wishes.
After you have drafted your will to your satisfaction, and your lawyer is also satisfied, you should keep it in a safe place. This should also be a place in which your survivors know to look. A will that is never found does not accomplish your wishes. Makes sure your personal representative knows that he or she will be responsible for those duties. It is even better if you are able to confirm his or her willingness to act as your personal representative. Consider giving a copy of your will to your personal representative.
If changes in your life or circumstances arise, it may become appropriate to make changes to your last wishes. For small or simple changes, a codicil should suffice. A codicil is simply an addition or supplement to modify a will. Such a modification can include revoking portions of the will, also. Substantial or frequent changes may warrant drafting a new will entirely, as codicils can become numerous and complicated.
If your will is out of date or you don’t have a will at all, please contact the professionals at Toussaint & Coaty today for advice and assistance. We would be glad to help you.
Whether you are a general contractor, subcontractor, or home or business owner, you are likely at some time to be affected by a mechanics’ lien. In Colorado, these liens are governed by statute: Title 38, Article 22 of the Colorado Revised Statutes.
A lien is a legal claim, or security interest, on an item of property which is intended to secure the payment of a debt. Labor- and service-providers may secure payment for the work they perform on real estate through a mechanics’ lien. The range of people who may protect their right to payment through a mechanics’ lien is very broad: “Every person who furnishes or supplies laborers, machinery, tools, or equipment in the prosecution of the work, and mechanics, materialmen, contractors, subcontractors, builders, and all persons of every class performing labor upon or furnishing directly to the owner or persons furnishing labor, laborers, or materials to be used [. . .], and also architects, engineers, draftsmen, and artisans who have furnished designs, plans, plats, maps, specifications, drawings, estimates of cost, surveys, or superintendence, or who have rendered other professional or skilled service, or bestowed labor in whole or in part, describing or illustrating, or superintending such structure, or work done or to be done, or any part connected therewith.” C.R.S. 38-22-101(1)
There is, however, a statutorily prescribed process for securing this interest. Within four months after “the day on which the last labor is performed or the last laborers or materials are furnished,” the lien claimant must record with the appropriate county a statement containing the name of the property owner, the name of the lien claimant, a description of the property, and amount due to the claimant. And at least ten days before recording such statement, the claimant must serve a notice of intent to file a lien statement upon the owner of the property and the principle contractor on the project.
During that four month period, a lien claimant may record a notice with the county clerk and recorder that the claimant may file a lien statement. This notice extends the time for filing a lien statement to the lesser of four months following completion of the improvements or six months following recording the notice. Subsequent notices may be filed thereafter, if the improvements remain uncompleted, which notices will also extend the time for filing by six months.
Within six months following the last work or labor performed or supplied, unless extended by notice, the lien claimant must commence a foreclosure action. The lien claimant should take care that the lien is not for an amount greater than is due, though, as such claimant could be liable “to the person against whom the lien was filed in an amount equal to the costs and all attorney’s fees.” C.R.S. 38-22-128.
There are, of course, exceptions and amendments to the above, depending on the specific circumstances of the project and lien claimant. There may be defenses to the lien, the lien may not be valid against a government entity, and there may be a bond against which claims can be made in lieu of filing a lien.
With all of the variety and complexity involved, you should contact the professionals at Toussaint & Coaty, P.C. for advice on your mechanics’ lien issue today.
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