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Pasternak & Fidis Reporter

February 17, 2022

Treatment of Vermont Civil Union as a Marriage for Purposes of Divorce in Maryland

In 2020, in a case called Sherman v. Rouse, the Maryland Court of Special Appeals had to decide whether a 2003 Vermont civil union, which pre-dated marriage equality, should be treated the same as a marriage for purposes of granting a divorce and related rights, including spousal support and equitable division of property. One aspect of the problem presented to the trial court was that, unless the parties’ legal status could be treated the same as a marriage, the Maryland court would have no authority to dissolve it; and, because the parties were not residents of Vermont, a Vermont court would have no authority to dissolve it either, leaving them in a rather awkward spot. The other aspect of the problem is that, unless the parties’ legal status was treated the same as a marriage, there was no basis for equitably dividing the property accumulated during their 15+-year relationship. The Court of Special Appeals held that the Vermont civil union should indeed be treated the same as a marriage for purposes of granting a divorce and adjudicating property division. It seems like hair-splitting, but the Court of Special Appeals did not say a civil union was a marriage; rather, it said that, because the Vermont law creating civil unions specified that parties had the same rights and obligations as parties to a marriage, including the right to a divorce and to share in property at divorce, the Maryland court should respect Vermont law and give the Vermont civil union the same effect in Maryland.


February 16, 2022

Custodial Accounts, 529 College Savings Plans and Divorce

Common options for families to save for their children’s education are through custodial accounts and 529 savings plans. When a couple divorces, the treatment of these resources needs attention. A recent unreported case from the Maryland Court of Special Appeals points this up. This article highlights issues that should be addressed as part of a settlement agreement or, if necessary, in court.

UGMA and UTMA Custodial Accounts

There are two types of custodial accounts, UTMA (Uniform Transfers to Minors Act) and UGMA (Uniform Gifts to Minors Act). UTMA accounts have replaced UGMA accounts in most states and the District of Columbia. Each allows for creation of an account for a specific minor child. An UTMA can hold cash, securities, real estate, and other property. Often… MORE >

February 15, 2022

Premarital Agreements and Post-Execution Conduct

Parties to a premarital agreement are free to make decisions during the marriage that alter their financial circumstances so long as they meet their contractual obligations. Post-execution actions can strengthen the validity of the agreement, result in a claim that the agreement has been revoked, or leave the agreement intact but change the economic outcome.

Conduct that Strengthens Validity

The low standards for validity create opportunity for a claim of duress, especially when a proposed agreement is presented close to the wedding or a weaker party does not get legal advice. (These claims rarely succeed.) Contract law acknowledges that a party may ratify a contract, thus waiving a duress claim. Acceptance of the benefits of a contract is generally considered ratification. When the agreement requires… MORE >

February 14, 2022

Cryptoassets and Estate Planning

The value and popularity of cryptoassets – a term that comprises everything from Bitcoin to other cryptocurrencies and includes nonfungible tokens (NFTs) and utility tokens – has grown exponentially in recent years. In November 2021, Bitcoin reached an all-time high of over $65,000. In March 2021, Christie’s sold a fully digital, NFT-based work of art for $69.3 million. Many people are paying attention to the increasing value of cryptoassets and are acquiring cryptoassets to hold for their own investment. It is now easier than ever to obtain cryptocurrency through popular apps, such as Venmo or PayPal. The internet has made available step-by-step guides teaching how to acquire NFTs and other tokens. Whether you currently hold any cryptoassets or plan to acquire them in the future,… MORE >

October 7, 2021

The Uniform Cohabitants’ Economic Remedies Act and Cohabitation Agreements

In July 2021, at its annual meeting, the Uniform Law Commission adopted the Uniform Cohabitants’ Economic Remedies Act (UCERA). Cohabitants already have the right to enter into a written or oral contract under general contract law principles. If enacted, UCERA would create statutory recognition of these rights and would expand the bases for cohabitant property claims.

UCERA has not been adopted, or even considered, by the legislatures of Maryland, Virginia, or the District of Columbia. It seems unlikely that it ever will. However, it addresses a problem that will continue to exist when two people live together, acquire property, make promises to each other about sharing assets upon death or dissolution, or when one party believes they have done so.  Whether UCERA is ever adopted,… MORE >

October 7, 2021

COVID-19 and the Rise of Electronic Signatures

Since early 2020, fewer face-to-face transactions have been possible because of mandatory social distancing. These restrictions changed the way lawyers and clients handled contracts and other business and personal transactions. The remote work environment reduced ink-to-paper signatures and increased the use of electronic signatures for contracts. Parties to a contract use the click of a button, sign on an electronic notepad, add their signature to the end of an email, or upload a picture of their signature to software. This development has led to questions about authenticity, validity, and enforcement of contracts.

Although an oral contract can be valid, with some exceptions, most contracting parties prefer a written agreement with signatures. In the family law area, a premarital agreement must be in writing and signed… MORE >