What Jurisdictional Issues Should I Expect in Multi-State, High-Value Divorces?
High-value divorces are complex because they involve substantial assets, business interests, tax concerns, and intricate marital estates. Sometimes, divorce can span multiple states, which increases the complexity even more.
In fact, jurisdictional issues about which state (or states) have the legal authority to hear and decide the case can significantly influence the outcome of certain issues. This blog discusses the key jurisdictional issues in multi-state, high-net-worth divorces.
1. Jurisdiction and Residency
Each state has specific residency requirements before its courts can assume jurisdiction over a divorce. For example, California requires at least one spouse to have lived in the state for six months. In contrast, New York requires a residency of one to two years, depending on the circumstances of the case.
In multi-state situations, more than one state may qualify to hear the divorce. This can lead to forum shopping, where one party files in the state whose laws are most favorable to them (e.g., more generous spousal support laws or more favorable property division frameworks).
2. Concurrent Filings
If both spouses file for divorce in different states, courts will often look at who filed first. Many jurisdictions follow a first-in-time rule and defer to the state where the divorce action was first initiated.
However, this is not always the case. The second court may determine it is the more appropriate forum. In high-value divorces, there is often a jurisdictional battle at the outset of litigation.
3. Jurisdiction Over Property
Even if a court has jurisdiction over the divorce proceeding, that does not automatically mean it has jurisdiction over all marital assets. Real estate or business interests located in another state may be outside the immediate reach of the court’s authority.
If, for instance, a couple owns commercial real estate in New York, but the divorce is being litigated in California, the California court may not have the authority to directly divide the New York property without some form of cooperation from a New York court or party.
4. Child Custody Jurisdiction
If the divorce involves children, custody issues are governed by the Uniform Child Custody Jurisdiction and Enforcement Act (UCCJEA). The UCCJEA has been adopted by 49 states (excluding Massachusetts).
Under this uniform law, jurisdiction is generally established in the child’s “home state,” i.e., the state where the child has lived with a parent for at least six consecutive months prior to the commencement of the proceeding.
The UCCJEA becomes especially relevant in multi-state scenarios where one parent relocates with the child. The UCCJEA prevents parents from moving children across state lines to seek more favorable custody outcomes.
5. Out-of-State Judgments
Once a court issues a judgment, it must be recognized and enforceable in other states. Under the Full Faith and Credit Clause of the U.S. Constitution, valid judgments from one state are generally enforceable in another.
However, complications arise when judgments from one state are inconsistent with the laws or public policy of another. For example, one state may view a certain asset as marital property, while another may consider it separate.
Enforcing division orders involving out-of-state assets (e.g., seizing real property or bank accounts) often requires a process known as domestication of judgment in the second state.
6. Tax and Business Jurisdictional Considerations
High-value divorces often involve tax implications across state lines, such as state income taxes, capital gains on transferred assets, or treatment of business valuations. States vary in how they treat trusts, executive compensation, stock options, and other complex holdings.
Legal and financial advisors must work together to map out the implications in every jurisdiction involved.
Contact a California Divorce Lawyer for Help With a Multi-State Divorce
Multi-state, high-value divorces require skilled legal representation to protect your interests. Choosing the right jurisdiction can impact virtually every element of the case. Contact Berenji & Associates Divorce Lawyers at (310) 271-6290 and schedule a confidential consultation to discuss your rights.
We serve all through Los Angeles, Beverly Hills, Los Angeles County, and its surrounding areas. Visit any of our offices at:
Berenji & Associates Divorce Lawyers Los Angeles Office
550 S. Hill Street STE 1467
Los Angeles, CA 90013
(213) 277-2586
Berenji & Associates Divorce Lawyers Beverly Hills Office
9465 Wilshire Blvd #333
Beverly Hills, CA 90212
(213) 277-2586