Divorce and Money

There’s no doubt that the social changes of the second half of the 20th Century brought about important changes in the way people live. Many social critics argue that one of the key changes has been more liberal attitudes toward marriage and divorce. The easing of legal barriers and social stigma allows people to get out of bad marriages more quickly. On a social and psychological level, easier divorce may be an improvement in the way people live. But on a financial level, divorce remains a major problem. It has been well established that divorce creates financial hardship for everyone involved, but especially for women and young children.

This hard reality reflects some little-realized legal and financial facts namely, that marriage exists primarily in legal and financial contexts as a conduit for transferring wealth from spouse to spouse, and from parent to child. Although divorce is well established in the law, it still makes smooth transfer...not so smooth.

The May 2001 Delaware Chancery Court decision Doris Mitchell v. Betty DiAngelo offers a good example about how deep this instability can go. And how long it can last.

Carl Jones and Betty DiAngelo were married in 1951. They had no children together. In June 1968, Betty sought a divorce in order to marry another man. Carl’s attorney arranged for her to go to Alabama, where she obtained a written divorce decree dated June 28 and signed by an Alabama judge named F.O. Whitten. She married her second husband
in Georgia the next day. Shortly before she left Delaware for Alabama, Betty signed a written agreement with Carl that stated his payment to her of $5,000 would be a complete settlement of all of her rights to their marital property.
He got the home, and by August 1968, Carl was identified as a “divorced man.” Betty and her second husband lived together until his death in 1987. Betty then began to collect Social Security benefits and a veteran’s pension as that man’s widow. She married for a third time in 1990 but that marriage ended in divorce a year later. Carl never remarried and had no children. He died without a will in early 2000. When Betty learned of Carl’s death, she calculated that she would be eligible to receive higher Social Security benefits as Carl’s surviving spouse than she was receiving as her second husband’s surviving spouse. She applied for an adjustment with the Social Security Administration. As part of the adjustment, the Social Security Administration asked for a copy of the Alabama divorce decree. When Betty wrote to Alabama for a certified copy of the divorce, she discovered that

the state had no official record of her divorce from Carl and that Judge F.O. Whitten had been imprisoned for issuing fraudulent “quickie” divorces. Suddenly, Betty had a whole new legal strategy to pursue. She filed legal papers in Delaware, claiming right to 100 percent of Carl’s estate as his widow. She argued that, because the divorce decree was void, her subsequent marriages were also void. And that she was Carl’s wife when he died. On the other side, Carl’s family members (led by his sister, Doris Mitchell, who was the administratrix of his estate) argued that Betty should be prevented
from denying the validity of the Alabama divorce and her later marriages and, thus, from inheriting Carl’s money and property. Furthermore, Mitchell argued, the Property Settlement Agreement Betty and Carl signed as she was leaving served as a release of all of Betty’s claims against Carl’s estate. The Delaware court agreed with Mitchell. In its ruling, the court pointed to The Uniform Probate Code, which provides that: a surviving spouse does not include (1) an individual who obtains or consents to a final decree or judgment of divorce from the decedent or an annulment of their marriage, which decree or judgment is not recognized as valid in this State...; (2) an individual who, following an invalid decree or judgment of divorce or annulment obtained bythe decedent, participates in a marriage ceremony with a third individual; or (3) an individual who was a party to a valid proceeding concluded by an order purporting to terminate all marital property rights. Put simply, the court held that subsequent marriages compromise a person’s status and right to make a claim on the estate of a previous spouse even if there has been an invalid divorce. The court said: ...ubiquitous change in public attitude toward divorce in the last half century, and the vastly different set of laws now in effect in this and other states, is reflected in more modern opinions in the area. In making its decision, the court pointed out the unique and troubling aspect about Betty DiAngelo’s claim: She had waited more than 30 years and until Carl had died—before she asserted any claim to a greater share of their marital property.The court wrote that there would be a fundamental unfairness if Betty were allowed both to ignore her divorce and remarriage and to avoid the effect of her agreement to renounce her statutory right to Carl’s estate. She had lived her life since 1968 as though she were divorced from Carl and fully enjoyed the benefits of that divorced status. Now that Carl was dead and her marital duties to him had terminated extra-judicially, it was too late for her to assert her rights as his spouse. In the court’s final words, “...between Betty and Carl, equity and good conscience dictates that they be left where they put themselves...in 1968.”

Posted in: C H A P T E R 1