Features

Last month, we explained that the proposition that a creditor can do whatever it wants with its recovery from a Chapter 11 debtor may seem to be a fundamental right -- but that in the context of confirmation of a Chapter 11 plan, that right may not be unqualified. It may, in fact, violate well-established bankruptcy principles. We went on to explain that one such principle that applies only in the context of non-consensual confirmation of a Chapter 11 plan, or "cramdown," is commonly referred to as the "absolute priority rule," a pre-Bankruptcy Code maxim that established a strict hierarchy of payment among claims of differing priorities.

Features

The Hague Convention on the Civil Aspects of International Child Abduction (the Hague Convention) provides that a child who is habitually resident in one party country, and has been removed to or retained in another party country in violation of the left-behind parent's custodial rights, should be promptly returned to the country of habitual residence. However, many countries are not parties to the Convention, and even some that are parties enforce the laws only sporadically or in accordance with their own societal customs. Thus, the attorney must take special care when faced with the possibility that his client's foreign national spouse might take the children to such a country.

In last month's newsletter, we explored the state of the law on grandparent custody of children prior to the amendments to FCA ' 651(b) and DRL ' 72(2)(a) (b) (c), which codified jurisdiction to hear and determine petitions filed by grandparents for custody of their grandchildren. The amendments, which went into effect on Jan. 5, 2004, appeared to change the law to make it easier for grandparents to gain or keep custody of grandchildren. The leading case law previous to the amendments could be found in <i>Matter of Bennett v. Jeffreys</i>, 40 NY 2d 543, 387 NYS 2d 821, 356 NE 2d 277 (1976), in which the Court of Appeals held that a parent has a superior right to custody over a nonparent unless the nonparent meets the burden of proving "extraordinary circumstances." Once such extraordinary circumstances are shown, a court may then move on to consider custody in light of the best interests of the children. After the amendments went into effect, the question became, did those amendments substantially change the law for grandparents seeking custody?

Two recent cases in our office have highlighted the legal and procedural conundrums occasioned by parties residing in different states at the time divorce proceedings are commenced, where one of the spouses earned a medical degree and obtained medical licenses and board certifications (ie, enhanced earning capacity) during the course of the marriage. As most readers of this publication are surely aware, New York is the only major jurisdiction in our nation to value enhanced earning capacity for purposes of equitable distribution. Thus, whether the case is litigated in New York or in a different state can have a marked effect on the outcome of the financial aspects of the case, to the tune of hundreds of thousands of dollars, if not more.

Recent rulings of interest to you and your practice.

Features

The right of first refusal ('ROFR') and its close cousin, the right of first offer ('ROFO'), collectively sometimes called pre-emptive rights, are devices used to afford the grantee a degree of flexibility in potentially buying or leasing the subject property at a future time. These rights can be considerably more troublesome, especially to grantors, than may be immediately apparent to many real estate deal makers. Many who have been 'burned' recognize that the problems include: 1) financial loss and delay in completing a transaction that arise from dampened interest in the subject property on the part of third-party potential bidders, and 2) disputes (sometimes resulting in litigation) that arise from issues surrounding the triggering, execution, and preservation of the right. This article focuses on the second problem, with special emphasis on disputes that revolve around the triggering of the pre-emptive rights. It also suggests certain drafting implications that follow from the analysis.

Features

In divorce situations, nothing -- not even the question of who gets the house -- can compare to the importance of the question of how custody of the children will be worked out. Some lucky families will be able to work together toward the optimum solution for all concerned, with a willingness to be flexible that will keep the arrangement working smoothly for years. Other parents, however, will be at odds, due to real concerns for the children and the parents' relationship with them, or even from sheer animosity toward one another. In this special issue focusing on custody, we look at the some things all parents in custody battles should consider as well as some things that will affect only a smaller percentage of parents.

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Over the years, I have helped prepare many parents to testify in custody matters. In that time, I have discovered crucial areas of preparation that will help produce a competent and confident witness. Parents need guidance on: 1) attitude; 2) behavior; and 3) basic custody topics they should be prepared to discuss. Most lawyers manage to include parts of these three areas when preparing their clients for trial, but frequently, the approach is scattered. The instructions are fine as far as they go, but there are holes in the preparation that, if stumbled into, will certainly trip up and unnerve a witness. School your client on the following elements of testimony and the chances of a favorable outcome will be greatly increased.