Minneapolis Divorce Attorney & Lawyer : Minnesota Family Law Firm : Brown Law Offices : St. Paul, Twin Cities MN

Many of our current and former clients are entrepreneurs - owners of small businesses, including restaurants, hair salons, trucking entities, vending services, auto repair shops, construction companies and web design firms. Important to keep in mind that even if the business was started and managed by just one spouse, it may be "marital" in nature. Marital assets are generally subject to an equal division among the parties.

The first step in allocating a business interest involves ascertaining a market value for the entity. It should come as no surprise that business owners typically think their enterprise is worth very little when a spouse comes knocking with divorce papers. That's when a divorce attorney experienced in complex property valuation and allocation cases can help.

In an effort to combat the difficulty associated with determining the market value of a business interest, one (or sometimes both) parties will retain the services of a qualified business appraiser to evaluate the asset. The best business appraisers are certified in their field, have many years of experience and hold advanced degrees and credentials in accounting. We have ongoing relationships with some of the best appraisers in the Twin Cities.

The cost of a business appraisal varies widely, depending upon the qualifications of the appraiser and the nature of the company being valued. Naturally, the larger the enterprise, the more involved the appraisal will be. Base rates for appraisals of simple sole proprietorships typically range from $4,000 to $6,000.  

As part of their valuation, business appraisers will produce a detailed report. These reports become evidence in the case and describe the information gathered by the evaluator, methods utilized to determine value and an ultimate opinion as to the value of the business.

Evaluators will use some, or all, of the following approaches in determining the value of a business:

• Income Approach: Values a business based upon the ability to generate economic benefit for the owners. For example, if a small business is a "high risk" investment, a buyer may wish to realize a return of 20% per year on equity. As a result, the business may be worth five times the profits of the business.
• Asset Approach: Values a business based on a balance sheet of assets less liabilities. Profits are not taken into account, just equipment, inventory and goodwill, offset by debts owed.
• Market Approach: Values a business by comparing historic sales of similar businesses. An evaluator may research recent sales in the marketplace to determine what a willing buyer would pay for the business interest.

Please contact me if you have further questions about the division of business interests in a Minnesota divorce. Our Minneapolis divorce lawyers offer a free consultation to all potential clients.

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Paternity must be established in order for the father of a child to seek physical custody, legal custody or parenting time with a child born outside of marriage. In the absence of establishing paternity, a father has no custodial rights, or the ability to exercise parenting time, unless the parties agree otherwise.

Minnesota law provides two ways for a father to establish paternity of a child: (1) a signed Recognition of Parentage; or (2) a court order.

A Recognition of Parentage ("ROP") is signed by the parents of a child, at the hospital, shortly after the child's birth. The execution of a ROP establishes the father-child link, allowing a father to move a court for physical custody, legal custody or parenting time.

In other circumstances, the mother, father or county (if public assistance has been received by mother) may establish paternity through a court proceeding. The father and child will participate in genetic testing to determine paternity. The issues of physical custody, legal custody and parenting time may be addressed in the same court case. A case may be filed in court anytime until the child reaches 18 years of age.

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Do the right thing...even when no one is looking. Great advice from Greg Cook, one of the top private investigators in the country (and, thankfully, stationed right here in the Twin Cities). Greg and I had lunch the other day and engaged in a long discussion about the uses of a private investigator in family law cases despite the fact that Minnesota is a no-fault divorce state.

In terms of property issues, some spouses falsely assume that they can hide assets from the other. Divorce fraud is perpetrated when one party fails to inform the other party of all assets one owns. All searches conducted by Greg and his staff abide by laws and regulations set forth in the Fair Credit Reporting Act, The Fair Debt Collections Practice Act, and the Gramm-Leach-Bliley Act (GLBA). Despite these hoops, they are able to locate bank accounts, cars, homes, boats, business interests, securities and any other tangible property interests held by your spouse.

Individuals asked to pay alimony often under report their income - in an attempt to persuade the court to believe that they don't make enough money to afford to pay. Similarly, a spouse seeking alimony may also under report their income - in an attempt to persuade the court to believe that they don't make enough money to meet their monthly expenses. Investigative methods can prove whether a subject has a place of employment not being reported or there is co-habitation involved (which could decrease alimony and monetary support decisions made by a court based on reduced financial need in your spouse).

Infidelity may be proven through surveillance. Keep in mind, the act of cheating is not a basis to seek a disproportionate award of marital property or custody of your kids. However, much can be learned about a person by knowing the company they keep. Does your spouse's lover have a criminal record? Are your children being neglected while your spouse is out with someone else? If the children form a relationship with this person, what sort of home environment will they be subjected to? Answers to these questions are relevant to the court in determining what is in the best interest of your kids. 

In addition to information relating to your spouse, investigators can help with trial preparation in the form of locating and interviewing witnesses, conducting public record searches, service of process, paternity testing and other background investigations concerning individuals associated with a case.

Our firm has retained Greg in numerous cases and the results are always amazing. He consistently provides us with reliable information that might otherwise have taken months to uncover - if we were ever able to recover it at all.

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If you and your spouse cannot reach agreement on the legal and physical custody of your child, your matter is probably headed for trial. The court will be left to determine what is in the "best interests" of your child through the use of a custody evaluation and report. About 95% of the time, the court will adopt the evaluator's recommendations - unless you have a strong advocate who knows how to challenge their conclusions.

Here are a few ways to discredit the custody evaluator at trial:

1. Bias. In personal injury cases, the insurance company will hire a doctor to examine the injured. Insurers pay thousands of dollars (now you know where your premiums go) to certain doctors who are prone to rendering an opinion favorable to the insurance company. These "independent" experts are often discredited by the plaintiff's lawyer bringing out the hundreds of prior opinions these physicians have rendered against injury victims. The same holds true in family court. Most custody evaluators have years of experience and have rendered hundreds of opinions. If there is consistency in those opinions, they carry a bias. Certain experts are prone to rendering certain opinions. Make the court aware of the bias of the evaluator and the recommendations may be discredited.
2. Diligence. We've cross-examined custody evaluators who have spent less than an hour in the presence of our client and the children that are the subject of the action. How much can anyone learn about a familial situation in 60 minutes of observation. What if the kids were having a tough day? What if the parent is nervous about the scrutiny of the evaluator? What if the dog won't stop barking? Think of it as a movie. If someone stopped "Titanic" before the ice berg and never watched the ending, they'd think everyone arrived safely in New York and wouldn't know the whole story. Evaluators are busy people. That haste can be taken advantage of.
3. Qualifications. Just who is the evaluator in your case? Do they have Ph.D.? How many evaluations have they conducted? Who are they employed by? What is their degree in? Have they been subject to an action for malpractice or ethics complaints? Disciplined by a professional board? Are they a licensed psychologist? All of these questions go to the foundation of the expert's opinions. Get them disqualified as an expert and the court cannot rely on their recommendations.

These same techniques can be used to discredit other court-appointed custody experts, such as a Guardian Ad Litem. No kidding - we had case in which the adverse Guardian had a degree in art history and failed to spend a single moment with our client in the presence of our client with the children (despite a statutory requirement that she meet with the parent in the presence of the children in the relevant home). We attacked her opinions on all three of the grounds referenced above.  

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When the dust settles from your divorce, you may find new problems on the horizon. As lawyers, we work very hard to draft a parenting time schedule that is concrete and detailed to avoid any ambiguity or need for interpretation. Inevitably, however, parenting conflicts arise. Enter the parenting consultant (or parenting time expeditor) if you and your ex can't resolve your dispute.

A parenting consultant is part mediator and part arbitrator. They can listen to parents and facilitate discussion, but also possess decision-making authority. Most are experienced family practitioners or child psychologists who work primarily in the area of parenting dispute resolution.

Parenting consultants offer the following benefits:

• Good decisions;
• Fast decisions; and
• Cheap decisions.

Most parties agree to employ a parenting consultant as part of their divorce decree and appreciate the ability to turn to someone with decision-making power with a simple phone call (try doing that with a judge) in the absence of ongoing legal fees. Most agree that the decision of the consultant is binding and may only be modified with an appeal to the court within 14 days from the decision. Parties typically split the cost of the consultant.

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Depending upon the facts and legal issues involved in your divorce, a number of experts may play a role in your case, including a home appraiser, actuary, custody evaluator, business appraiser and vocational assessor.

The most common expert we employ is a home appraiser. In most cases the most valuable asset for division is the marital homestead. If one party elects to remain in the homestead we must calculate the equity in the house to determine the value of the property settlement. Naturally, the first step to establishing equity involves the determination of the market value of the property.

A typical homestead appraisal costs around $350. They take approximately one (1) week to complete. Many clients ask if a realtor’s market analysis can substitute for an appraisal. If the parties agree, a market analysis is sufficient. However, a realtor’s market analysis does not hold the same evidentiary weight as a certified real estate appraisal. For that reason, the appraisal is usually preferred.

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The Minnesota Court of Appeals has opined that experts retained on a neutral basis by the parties to an action for dissolution of marriage are not entitled to quasi-judicial immunity (they are not immune from being sued for malpractice).

In Peterka v. Dennis, appellant sued respondents, an accountant and his employer, asserting that the accountant committed malpractice, for which his employer is vicariously liable, in evaluating businesses in connection with appellant’s dissolution action. Because the accountant was retained as an independent neutral evaluator of the businesses and a Hennepin County District Court Order required appellant and her husband to cooperate with and pay for the evaluation, respondents moved for summary judgment asserting quasi-judicial immunity. The district court granted summary judgment, holding that court appointment and public policy required that respondents be protected by quasi-judicial immunity. Because it concluded that respondent's accountant was not retained or appointed to perform a "judicial" function, the Minnesota Court of Appeals opted to reverse and remand.

The Court held that Dennis’ evaluation of business assets did not involve an "exercise of authority that is essentially judicial in nature." Dennis’ function was to apply sound accounting principles to develop factual bases supporting his expert opinion on the value of businesses in which appellant and her husband had an interest. Dennis had to exercise the same skill and judgment required by those in his profession; but exercise of that judgment did not equate to performing a judicial function. Dennis was retained, whether by appellant and her husband, or by the court, to give his expert opinion on the businesses’ value, not as a "decision-maker to determine competing claims" of appellant and her husband. For these reasons the Court concluded that even if Dennis was a court-appointed neutral, he was not appointed to perform a judicial function, and therefore is not entitled to quasi-judicial immunity. Because Dennis is not entitled to such immunity, Baune Dosen is therefore not entitled to vicarious quasi-judicial immunity.
 

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Minnesota is a no-fault divorce state. A divorce will be granted in Minnesota without the necessity of proving that one of the parties is guilty of marital misconduct. In earlier times, a party to a divorce was required to demonstrate that the other spouse was at fault for causing a breakdown in the marriage. Adultory was by far the most common basis, but others included domestic abuse, abandonment and an inability to consumate the marriage.

Today, a party to a divorce in Minnesota must merely demonstrate that there has been an "irretrievable breakdown" in the marital relationship. One spouse must simply acknowledge as much, and the court will grant their request to dissolve the marriage. A relatively low threshold - and a tough pill to swallow for those who feel that there is no "justice" in their case unless the court takes into account marital misconduct.

Potential clients often ask, "Should I fight the divorce?" Yes, if you intend to do so outside of the legal arena through counseling or therapy. Once it is obvious that the marriage cannot be saved, your resistence should be limited to that which is necessary to obtain a favorable court order. Not wanting the divorce can be used as leverage against your spouse if they are anxious to conclude matters. Often, the impatient spouse will buy a quick resolution by making an extremely attractive settlement offer. This strategy should be balanced against overdoing it. If you are fighting the dissolution process out of anger or spite, you are likely to cause significant economic and emotional harm to you, your spouse and your children.

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