Assets Inherited After the Filing of Divorce Are Subject to Division By the Divorce Court

Under New Hampshire law, assets inherited by one party are part of the marital estate and subject to the divorce court's jurisdiction to divide upon divorce. All property acquired up through and including the date of divorce is part of the marital estate and subject to division. This is true even for assets that are inherited after separation and the filing of a divorce petition. In one case, a Marital Master divided assets inherited by one party, eight months after the filing of the petition for divorce. The New Hampshire Supreme Court upheld the Marital Master's division.

Whether the divorce court will divide the inheritance and to what extent depends on a variety of factors, including but not limited to the age of the parties, the length of the marriage, the overall value of the marital estate, each spouses' contribution during the marriage, each spouses likelihood of acquiring income and assets after the divorce, the health of the parties, etc.

If you have any questions regarding whether an inheritance is subject to division, please contact an attorney at Hamblett and Kerrigan for a consultation.


Kevin P. Rauseo is a director at Hamblett & Kerrigan P.A. He concentrates his practice in the areas of civil litigation, medical malpractice, personal injury, insurance defense and family law. He is a member of the Collaborative Law Alliance of New Hampshire. You can reach Attorney Rauseo at krauseo@nashualaw.com.

To read additional Family & Divorce Articles, Click Here.

To return to the Legal Articles Home Page, Click Here.

To return to the Hamblett & Kerrigan Home Page, Click Here.

CHILD SUPPORT CALCULATIONS MAY NOT INCLUDE ALL TAXABLE INCOME OF A SUBCHAPTER S CORPORATION

While the Child Support Guidelines are intended to make the calculation of child support simple and easy, this calculation is often difficult when one or both parties are shareholders of a Subchapter S Corporation. To the casual and uninformed observer, one may surmise incorrectly that the parties’ taxable income from the S Corporation is income to be used in calculating child support. On the contrary, merely because an item is considered taxable income by the Internal Revenue Service does not mean that that item qualifies as gross income for child support purposes. The New Hampshire Supreme Court has explained that how the federal income tax statutes define income, it is of little relevance to New Hampshire’s interpretation of gross income under the Child Support Guidelines. In fact, the New Hampshire Supreme Court has found that income tax returns are an unreliable guide to the income available for child support purposes. Taxable income of a Subchapter S Corporation which is attributable to a shareholder does not reflect the actual income received as a cash distribution. The mere fact that a business expense is not deductible for tax purposes does not make that money that was used for the business expense available to the obligor for child support purposes.

Accordingly, in order to decide what income is available for the child support calculation, a careful examination must be made of all the income and expenses of the Subchapter S Corporation and explained to the Court to derive at a fair and just child support order.

If you have any questions regarding the calculation of child support, please contact an attorney at Hamblett & Kerrigan, P.A. for a consultation.


Kevin P. Rauseo is a director at Hamblett & Kerrigan P.A. He concentrates his practice in the areas of civil litigation, medical malpractice, personal injury, insurance defense and family law. He is a member of the Collaborative Law Alliance of New Hampshire. You can reach Attorney Rauseo at krauseo@nashualaw.com.


To read additional Family & Divorce Articles, Click Here.

To return to the Legal Articles Home Page, Click Here.

To return to the Hamblett & Kerrigan Home Page, Click Here.

Piercing the Corporate Veil

Many small contract claims are litigated before the local district courts which are now part of the circuit court system in New Hampshire. The local district courts can hear non-jury trial if the controversy is $25,000 or less. However the district courts do not have jurisdiction to hear general equitable cases. They can only hear cases on an equity basis for which they have specific statutory authorities, such as landlord / tenant eviction actions.


The New Hampshire Supreme Court recently addressed in a contract action that the district court could not pierce the corporate veil of a corporate defendant to get to the individual who owned the shares in that corporation. Piercing of a corporate veil is an equitable remedy the Courts use when the reality is that the corporation is the alter ego of the individual and he is using it for his own purposes. The piercing of the corporate veil leaves the debt owed by the corporation as an obligation of the shareholder.

On December 14, 2011, in the case of Holloway Automotive Group v. Goran Lucic, the Court specifically reversed the Manchester District Court’s decision finding Mr. Lucic personally liable for his corporation’s breach of contract finding that the district court lacked jurisdiction to hear the equitable request for piercing the corporate veil to get to Mr. Lucic individually liable for the corporation’s breach of contract. The jurisdiction for such a claim would be exclusive to the New Hampshire superior courts. Therefore, if you are considering a smaller monetary court claim and are looking to hold the individual shareholder of a corporation or member of a limited liability company personally liable, this case states that the district court cannot rule on that claim and it must be brought in the superior court.

J. DANIEL MARR IS A DIRECTOR AND SHAREHOLDER AT HAMBLETT & KERRIGAN, P.A. WHOSE LEGAL PRACTICE INCLUDES COUNSELING BUSINESSES AND BUSINESS PERSONS INCLUDING PROFESSIONALS ON A VARIETY OF LEGAL ISSUES AND ADVOCATING ON THEIR BEHALF. ATTORNEY MARR IS LICENSED AND PRACTICES IN BOTH NEW HAMPSHIRE AND MASSACHUSETTS. ATTORNEY MARR CAN BE REACHED AT: dmarr@nashualaw.com.



To read additional Business Litigation Articles, Click Here.

To return to the Legal Articles Home Page, Click Here.

To return to the Hamblett & Kerrigan Home Page, Click Here.

BOUNDARY DISPUTE CLAIMS

Boundary disputes can be difficult between residential neighbors or commercial property owners. Working with a surveyor, along with having a good grasp of the law of adverse possession and prescriptive easement can be of great benefit in resolving such matters amicably or if necessary through court intervention. I have represented individuals making claims as adverse possessors and in other matters as record owners. Some cases were resolved through settlement and others that I tried to conclusion with one having gone to the New Hampshire Supreme Court to be resolved in my client’s favor. The disputed properties have included residential, commercial, and lake front properties which while not large enough to put a house on but are sufficient to allow the owner to apply for a mooring or a seasonal dock on the lake.


I would invite inquiries to me related to adverse possession or prescriptive easement cases whether you are considering bringing such a claim, defending against a claim, or establishing your record ownership rights to property for which you believe the user of the property will ultimately claim adverse possession or prescriptive easement.

J. DANIEL MARR IS A DIRECTOR AND SHAREHOLDER AT HAMBLETT & KERRIGAN, P.A. WHOSE LEGAL PRACTICE INCLUDES COUNSELING BUSINESSES AND BUSINESS PERSONS INCLUDING PROFESSIONALS ON A VARIETY OF LEGAL ISSUES AND ADVOCATING ON THEIR BEHALF. ATTORNEY MARR IS LICENSED AND PRACTICES IN BOTH NEW HAMPSHIRE AND MASSACHUSETTS. ATTORNEY MARR CAN BE REACHED AT: dmarr@nashualaw.com



J. Daniel Marr is a Director and Shareholder at Hamblett & Kerrigan, P.A. His legal practice includes counseling businesses and individuals on a variety of legal issues and advocating on their behalf. Attorney Marr is licensed and practices in both New Hampshire and Massachusetts. Attorney Marr can be reached at dmarr@nashualaw.com.



To read additional Employment Articles, Click Here.

To return to the Legal Articles Home Page, Click Here.

To return to the Hamblett & Kerrigan Home Page, Click Here.

Crowdfunding

Crowdfunding

A New Way to Fund Your Company?

Collecting small sums of money from the general public over the Internet is not a new phenomenon. Crowdfunding or Crowdsourcing has been around for a few years. In the past the majority of the Crowdfunding sites catered to one time creative events, or were used by charities to raise money. Two examples of this type of site are Kickstarter and IndieGoGo.

Generally, equity interests in businesses in return for a capital investment to help businesses operate and grow are registerable under the Securities Act of 1933 ("1933 Act"), unless the security or the transaction is exempt. Crowdfunding, by its definition, does not fall within the current exemptions available under the 1933 Act. The main obstacle is that the offer to invest cannot be circulated to the general public; it must be offered only to a select group of potential sophisticated investors. When a company uses a website, however, anyone with Internet access would have the opportunity to invest.

This all may change with the recent passage by the House of Representatives of the Entrepreneur Access to Capital Act (HR 2930). The bill, authored by Patrick McHenry of North Carolina has the backing of both parties as well as the White House.

The bill provides for a funding exemption from the Securities and Exchange registration requirements for certain offerings with some limitations.

(A) the aggregate amount sold within the previous 12-month period in reliance upon this exemption is:

(i) $1,000,000, as such amount is adjusted by the Commission to reflect the annual change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, or less; or

(ii) if the issuer provides potential investors with audited financial statements, $2,000,000, as such amount is adjusted by the Commission to reflect the annual change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, or less.

(B) the aggregate amount sold to any investor in reliance on this exemption within the previous 12-month period does not exceed the lesser of:

(i) $10,000, as such amount is adjusted by the Commission to reflect the annual change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics; and

(ii) 10 percent of such investor's annual income.

Senator Scott Brown of Massachusetts introduced a separate bill in the Senate on November 9th of this year with some small differences. His bill places lower thresholds on investment as one way to mitigate potential fraud.

Both bills bear watching. While Crowdfunding would provide another source of equity funding for small businesses, there are several potential drawbacks for entrepreneurs. Unlike contributions to one-off projects in which donors have no say in implementation, equity investors want, and are entitled to, some influence in the direction a business takes. Having hundreds of equity investors means you will be answering to hundreds of bosses. That's time-consuming and costly to administer. Moreover, startups that accept equity Crowdfunding can expect to have difficulty raising additional funds from venture capital firms and other sophisticated investors if they have hundreds of small, less knowledgeable backers.

However, with the potential enactment of either bill or a combination thereof, this may still become an alternative way to fund your start-up company.

If you have any questions or would like additional information on this issue or other corporate challenges, please contact Paul D. Creme.


Paul D. Creme is an attorney with Hamblett & Kerrigan PA. His practice is focused on business and corporate law. Of particular interest are the areas of software and emerging technologies. You can reach Attorney Creme at pcreme@nashualaw.com.



To read additional Business Organization, Formation & Governance Articles, Click Here.

To return to the Legal Articles Home Page, Click Here.

To return to the Hamblett & Kerrigan Home Page, Click Here.