Kelley v. Kelley, — So.3d —-, 2014 WL 4427275 (Fla. 4th DCA September 10, 2014)

4th DCA: “The driving force behind Nevada’s statutory impediment on collaterally attacking divorce decrees has its origins in the state’s decision to establish itself as a premiere divorce destination. A low barrier to attacking a Nevada divorce decree would have been bad for business.”

In this case a disinherited son contested his father’s estate on the grounds that his father wasn’t “legally” married at the time of his death, thus excluding his surviving spouse as a valid beneficiary of a multigenerational family trust. This kind of status-based challenge is a common line of attack in inheritance disputes. For example, inheritance cases can turn on a person’s status as a validly “adopted” heir (click here), or status as a true “descendant by blood” (click here), or status as a “posthumously” conceived child (click here), or status as a “legally” recognized father (click here), or status as a “legally” married spouse (click here). This is what happened in the Kelley case above.

Case Study:

The seeds of this controversy were planted over 50 years ago in 1956 when Gordon P. Kelley (“Gordon I”) created the Gordon P. Kelley Trust Fund, an irrevocable trust benefiting his children for life, including his son “Gordon Jr.” Under the terms of the Kelley trust when Gordon Jr. died he had a limited power of appointment, exercisable in his Will, to transfer the remaining assets of his trust to or in further trust for his surviving “spouse,” any descendants of Gordon I, and certain charities. If Gordon Jr. didn’t exercise this power, the trust fund divested 100% by default to his son, Gordon Kelley III (“Gordon III”).

Gordon Jr. exercised the power of appointment in favor of his current wife, Joanna Kelley (“Joanna”), and three charities. Gordon III got nothing. According to the 4th DCA Gordon III sought to invalidate his father’s power of appointment on several grounds, including Joanna’s status as a legally married spouse:

Gordon III sought a declaration finding Gordon Jr.’s exercise of his power of appointment invalid since Joanna was not his legal spouse, and thus was “not a permissible appointee” under the Kelley Trust. The count alleged that in 1979 Gordon Jr.’s first wife, Holly Burguieres, “appeared in Nevada for a ‘quickie divorce'” and secured a divorce decree after falsely asserting she was a resident of Nevada. Evidence of the ruse was allegedly memorialized by a financial agreement confirmed and incorporated by the trial court in its final dissolution judgment, which reflects that Burguieres actually resided in Mexico City.

Alleging that neither Burguieres nor Gordon Jr. satisfied Nevada’s six-week residency requirement, Gordon III contended the Nevada court lacked subject matter jurisdiction over their case, rendering the divorce decree void. Building upon this revelation, since Gordon Jr. was still legally “married” to Burguieres, his marriage to Joanna would be bigamous—and thus void as against public policy—making Gordon Jr.’s exercise of his power of appointment in Joanna’s favor invalid, since she did not fall within the four classes of beneficiaries permitted by the Kelley Trust. As a result, Gordon III averred “all assets of the [Kelley Trust] are distributable to [himself] as the default taker.”

Collaterally attacking a divorce judgment entered in another state:

Gordon III argued that according to the federal constitution’s “full faith and credit clause,” a Florida probate judge wasn’t required, or even entitled, to give effect to his father’s Nevada divorce judgment. Constitutional arguments come up from time to time in inheritance cases, but they’re always tough to make, and almost never work (see here, here). This case is no exception. Here’s the controlling test for collaterally attacking another state’s divorce decree on constitutional grounds, as articulated by the 4th DCA:

Consistent with full faith and credit, a divorce decree obtained in a foreign state is impeachable in Florida only if the judgment is susceptible to collateral attack under the foreign state’s jurisprudence. See Johnson v. Muelberger, 340 U.S. 581, 589 (1951). This rule “provide[s] a substantial degree of uniformity regarding the vulnerability of divorce decrees to collateral attack,” enhancing the finality of each state’s judgments. In re Marriage of Winegard, 278 N.W.2d 505, 508 (Iowa 1979). Furthermore, collateral attacks wilt against judgments involving parties who have had their day in court; where “there has been participation by the [parties] in the divorce proceedings” and “the [parties] ha[ve] been accorded full opportunity to contest the jurisdictional issues,” any further attack on the judgment is barred by res judicata. Sherrer v. Sherrer, 334 U.S. 343, 351 (1948) (footnote omitted); Coe v. Coe, 334 U.S. 378 (1948).

Did the argument work in this case? No. Why? Because both parties to the Nevada divorce (Gordon Jr. and Burguieres) participated in and accepted the court’s final judgment. In other words, they had their day in court and accepted the final outcome. Under these circumstances, a third party (Gordon III) is barred as a matter of law from re-opening the Nevada divorce by challenging the outcome years later in a Florida courtroom.

In this case, Burguieres initiated the Nevada dissolution proceedings by filing a verified complaint with the trial court, in which she attested to Nevada’s limited jurisdictional requirements. After Gordon Jr. answered the complaint without raising a jurisdictional challenge, Burguieres appeared in court and confirmed her residency allegations. . . . Since both Gordon Jr. and Burguieres participated in the divorce proceedings and are bound by the Nevada decree, Nevada law precludes Gordon III’s collateral attack. The Faith and Credit Clause therefore bars his full assault on the Nevada judgment in Florida.

By the way, it’s no accident that out-of-state challenges to Nevada divorces are so difficult. Having it any other way is bad for business. As noted by the 4th DCA:

The driving force behind Nevada’s statutory impediment on collaterally attacking divorce decrees has its origins in the state’s decision to establish itself as a premiere divorce destination. A low barrier to attacking a Nevada divorce decree would have been bad for business. As one commentator explains:

 To escape states with harsh laws, people with money (or, more frequently, wives of people with money) could get on a train and head for a “divorce mill.” Throughout much of the twentieth century, the divorce mill was Nevada. It needed the business, and moral qualms, for whatever reason, have never played a big role in Nevada jurisprudence. In 1927, Nevada reduced its residence period to three months, and in 1931, in a “frenzied attempt to head off … threatened rivalry” from other states, Nevada reduced the residence period still further, to six weeks. “Going to Reno” became almost a synonym for getting a divorce.

 Lawrence M. Friedman, A Dead Language: Divorce Law and Practice Before No–Fault, 86 Va. L.Rev. 1497, 1504–05 (2000).

What about non-U.S. divorce decrees?

Does it matter that the foreign divorce decree at issue in this case was entered in a sister state (i.e., Nevada), vs. a foreign nation (e.g., Mexico)? Yes. Divorce decrees entered in non-U.S. courts aren’t nearly as bullet proof as those entered in sister states (an important distinction to keep in mind in a state like Florida, which has the 4th largest immigrant population in the nation (one-in-five Floridians are foreign born)):

Gordon III contends the Florida Supreme Court’s decision in In re Estate of Kant, 272 So.2d 153 (Fla.1972), provides the child of a decedent, as a lineal descendant, with unbridled “standing to challenge and impeach the validity of a divorce decree [in Florida] when it will affect the validity of a later marriage to the reputed surviving spouse.” In Kant, the deceased’s children alleged in an answer to a petition for letters of administration that the deceased’s marriage to his current wife was void since the wife’s prior divorce to a different spouse in Mexico had never been “rendered.” In re Estate of Kant, 265 So.2d 524, 525 (Fla. 3d DCA 1972). At trial, the children presented evidence that the divorce decree was actually a forgery. Kant, 272 So.2d at 155. As a result, the trial court denied the petition for letters of administration, finding that the current wife “was in fact not the widow of the deceased because she had not been lawfully divorced from her prior husband.” Id.

Did the U.S. vs. non-U.S. divorce distinction ultimately matter in this case? No. Vegas may be its own form of alternate reality (like Miami!), but it’s still part of the U.S. Bottom line: the Nevada divorce stands; Gordon III’s claims fail.

The crucial difference between Kant and this case is that the Full Faith and Credit Clause was not at issue, since “[s]tates are not required to give full faith and credit to divorces rendered in foreign nations,” such as Mexico. In re Schorr’s Estate, 409 So.2d 487, 489 (Fla. 4th DCA 1981) (emphasis added). Bound by the precepts of full faith and credit, Gordon III was required—unlike the children in Kant—to demonstrate his ability to bring the action under the foreign state’s jurisprudence. Since, as discussed previously, Gordon III failed to meet this hurdle, his action was impotent and properly subject to dismissal.

An “insider’s” view:

For an insider’s view of this case, you’ll want to read this interview of one of the attorneys on the winning side of the case.