How do I get an Immediate Danger Order – What is Emergency Custody?

Many of our clients need an immediate change of custody or an immediate suspension of parenting time. It can be extremely frustrating for them to learn that it can take weeks or even months to get into court on a custody or parenting time issue. This feeling is compounded when the client believes their child is in danger in the other parent’s care.

We can help you get an emergency custody order. Call the Law Offices of Paul F. Sherman at (503) 223-8441 or Contact Us for a free emergency child custody consultation.

Emergency custody orders are useful in cases involving severe drug and alcohol problems, in cases of sexual abuse, in cases where the custodial parent is incarcerated or where the other party is suffering from severe emotional or mental issues resulting in hospitalization or a complete breakdown. Courts will generally protect children in each of these situations.


As a general rule, a court cannot issue an emergency custody order without both parties having an opportunity to be heard. This requires that a motion to obtain custody must be served on the opposing party and a hearing time must be set with the court for the matter to be resolved.

An important exception to this rule is an “Immediate Danger Order.” Temporary emergency custody orders are authorized by ORS 107.097(3). This provision requires that the court find that the child is in immediate danger based on a sworn statement by the moving party and testimony that a child is in immediate danger.

What is immediate danger? Immediate danger means that there is a clear and present risk that a child will be physically injured or neglected in such a way as to endanger the child. The risk here generally involves physical danger and “immediate” means now.

The evidence used by the court to support a finding of immediate danger must be true and credible and must be based on the moving party’s actual observations and personal knowledge. A mere assertion that the other parent is abusing drugs, abusing alcohol, or has done these behaviors in the past is not sufficient to show an immediate danger. Likewise, the mere fact that a parent is ill, hospitalized or homeless may not create an immediate danger depending on the age of the child and the overall circumstances of the case. An immediate danger order requires solid evidence that there is an immediate genuine risk of physical harm to the child. If a proper showing of immediate danger is not supported by the sworn testimony and evidence presented to the court, the court must deny the motion for emergency custody.


We know you have questions and we have answers. If you would like to learn more about immediate danger orders, call the Law Offices of Paul F. Sherman at (503) 223-8441 or Contact Us for a free telephone consultation.

Posted in Custody, Emergency Custody, Immediate Danger Orders, Modifications, Parenting Plans, Parenting Time, Protective Orders, Temporary Orders, Uncategorized | Tagged , , , , , , | Leave a comment



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Many of our clients have asked our office what they should know before filing for divorce. Before springing into action, you should take a moment to prepare yourself.

The dissolution process can be complicated and extremely difficult for those involved. It is important to have your ducks in a row to achieve the best possible outcome for your case. Preparation helps reduce the stress associated with divorce and will help reduce the cost.

For a more detailed discussion on how to prepare for divorce call the Law Offices of Paul F. Sherman at (503) 223-8441 or Contact Us for a free divorce or child custody consultation.


Removing the children from the divorce can greatly simplify the dissolution process. It is always better to come to an agreement with your spouse regarding how you would like to raise your children and what is the best parenting plan for your household. Sometimes this is simply not possible and a custody battle is inevitable, but for most people, an agreement on custody and parenting time is the best solution to minimizing the stress and cost of dissolution.

Generally, the court will review the status quo when making custody determinations. Parents who are accustomed to spending substantial time with their kids should insist on continuing to do so.

When one spouse leaves the children and the other spouse has physical custody, they are establishing that this parent is the primary caregiver for the children and the children’s best interests are served by continuing to reside with this parent. Thus, it is important to maintain the parenting time and parenting practices you are accustomed to.

Any substantial gaps in time with the children can become a major hurdle to overcome if you want to see your children more frequently than every other weekend and the occasional holiday. The children are not yo-yos and the courts will not deviate substantially from the status quo that was established during the marriage or relationship which gave rise to the child.

It is extremely important to continue to reside in the same household with the children as much as possible or to work out a parenting plan which recognizes the time you have spent with your child. The parenting plan should incorporate your usual practices, such as taking the children to school, attending their practices for various sports and activities and maintaining the time the children are accustomed to spending with each parent.


It is essential that you continue to be an active participant in your children’s life. Stay involved (or get involved) with their daily activities, take them to school, help them with their homework and get to know their teachers and friends. The court will award parents who are actively involved with their children substantial parenting time. It is always in the best interest and welfare of the children to spend time with the parent who participates in their lives on a regular basis.

It is important to know that each parent has an equal right to access the children’s school, education, medical care and any other important documentation. This, however, requires you to take an active role in determining what is going on with the children. Some parents adopt the role of working full time and allowing the other parent to spend the majority of their time raising their children. While this may work in an integrated household, it is simply a lesson for disaster in the dissolution process. The parent who does not spend time with their children will not be awarded custody or substantial parenting time. You need to get involved and stay involved with your children as much as possible.

In determining child custody, the court’s primary concern is to act in the best interests and welfare of the children and to cause as little disruption to their daily lives and routines as possible. If you are already actively involved in your children’s daily lives, activities and routines, the court will want to maintain that relationship so long as it is healthy and positive for the children.


Maintaining the family household is the primary concern when it comes time to calculate spousal support. Many of our clients vacate the marital home and unintentionally establish the need and requirement of spousal or family support.
Before obtaining your own apartment or other residence, you need to have a firm understanding of the costs associated with maintaining the family household. You should itemize all hard costs associated with running the household including the rent or mortgage, utilities, insurance, vehicle costs, food, medical expenses and all other expenses of the household. You can obtain an outline of the required information from a Uniform Support Declaration from this office. The court will then analyze the amount of income flowing into the marriage to determine what is necessary to maintain the family household and will then order an appropriate level of support.

It is important to be realistic when contemplating vacating the family residence and obtaining alternative housing. It is also important not to live unrealistically, such as on a friend’s couch or with your parents unless it is impossible to do otherwise. By maintaining a separate, substandard residence, you are establishing an ability to support two residences, regardless of the effect it is having on your personal life.

The calculation of an appropriate spousal support award is not just a crap shoot and requires the advice of a skilled spousal support attorney. Judges have a great deal of discretion in awarding spousal and family support. The results can be devastating if an accurate picture of the parties’ financial situation isn’t presented properly to the court.

The standard in all dissolution cases is the principle of what is just and proper under the circumstances. The court will not willingly place one party in substantial hardship over the other. Unlike child support, there is not a firmly established guideline for determining an award of spousal support. It is absolutely essential that you work with an experienced family law attorney to ensure an equitable amount of spousal support is awarded. Being unprepared can result in bankruptcy and financial ruin.


Other than the children, the greatest concern of most parties facing divorce is protecting their finances. While you should anticipate that the marital assets will be divided by the court, there are, however, several different ways to keep your head above water through the dissolution process.

For many people, getting their finances in order is always a tricky business. Here, knowledge is key. Get to know your finances and the cost to run your household. Know the amount of money coming in and going out on a monthly basis. Know where there is fluff and where there is no room for cuts. Knowing what to expect on a monthly basis will substantially reduce the amount of anxiety you are feeling throughout the divorce.

Getting to a quick and easy financial solution will greatly reduce the costs of a divorce and the headaches associated with trying to maintain two separate households. It is essential to discuss your situation with a skilled divorce attorney who understands how divorce will affect your financial picture and will be able to give you specific advice on how to protect yourself and your assets to the greatest extent possible.

Establishing separate accounts and credit cards should be the starting point. Getting off credit is essential to saving the family finances. Paying off credit cards and loans in full and closing the accounts will limit your responsibility after the divorce.

The court will generally award a party any debt incurred after separation and will split marital debt on an equitable basis. So, get a grip on what you owe and a plan to get it paid as soon as possible. People who avoid taking control of their finances or who do not pay taxes for several years are asking for disaster. There is simply no excuse for not knowing the finances of the household.

Having your finances in order is essential if you are contemplating divorce. It is beneficial to open your own checking, savings, and retirement accounts. Further, it is essential that you act promptly when the issue of divorce becomes inevitable. When a Petition for Dissolution of Marriage is filed, the court can enter a Restraining Order to prevent the dissipation of assets. Otherwise, once the money is gone from a checking account, it is gone for good and generally cannot be recovered.

Take steps to protect yourself and your family as soon as possible. Failure to act can have a devastating impact on the bottom line. This is one area where it is imperative that you have a clear understanding of your circumstances and how divorce will impact your financial lifestyle.

It is also important to get organized before filing for divorce. You need to obtain tax returns, pay stubs, retirement plans, wills and insurance. You need to obtain documentation regarding any real property the parties may own, such as the underlying sales file with the title company. A skilled family law attorney is essential in helping you organize yourself for the dissolution process. Having a solid understanding of your finances and the underlying documentation is an excellent way to reduce your stress level and keep the costs of the dissolution at a minimum.


Many people fail to realize that social media can have a substantial and devastating impact on the outcome of a divorce. Let’s face it – if you do not want what you have written to be placed on the chalkboard before the class, then don’t post it on social media.

The impact of social media is frequently overlooked by parties preparing for a divorce. Your Facebook, Twitter, Instagram, Tumbler and other social media accounts are great platforms for providing evidence in your case.

The parties involved in the divorce process should simply disengage or close their social media accounts. Too many people use social media to vent about their spouse or problems in their lives. If you are going through a divorce, those photos and status updates can be used as evidence in your case. Never publish photographs of yourself partying with your friends or family during the divorce. Never make a post regarding drugs or alcohol usage.

Any person who believes that they can rely on the security settings for social media to protect them is simply a fool. Your friends and family can and will provide your Facebook posts to your spouse if they are detrimental to your children.

Keep your personal information private for the duration of your divorce; and, avoid the urge to comment on your soon-to-be ex on any social platform. Social media information is not private and will be ordered to be disclosed if it has relevance on custody or dissolution issues.

Keep texting to a minimum. Many of our clients make horrible errors in judgment when texting their spouses or significant others. Texts made while angry or upset should simply be deleted before they are sent. Again, use the principle that if you are not comfortable having your text blown up to the size of a poster, simply don’t send the text.


The dissolution process is never easy. Solid preparation for the divorce process is something that should not be overlooked or avoided. Going into a divorce with a plan and a strategy can save you substantial emotional and financial pain.

We know you have questions and we have answers. If you would like more information about what you should do to prepare for a dissolution or custody case, call the Law Offices of Paul F. Sherman at (503) 223-8441 or Contact Us for a free divorce and custody consultation.

Posted in Custody, Dissolution of Partnership, Divorce, Family law, Parenting Plans, Parenting Time, Spousal Support | Tagged , , , , , , , | Leave a comment


Our clients often ask what to do when their parenting time is being denied. The first step in any parenting time case is to determine if there is a valid court order or judgment which provides for parenting time. If there is a valid court order, the next step is to determine whether the parenting time as specified in the judgment or court order is being denied.

There are generally two methods to enforce a valid parenting time order: (1) a motion to enforce parenting time; or (2) a contempt proceeding. Some of the differences between the two procedures are outlined below.

For a more detailed discussion call the Law Offices of Paul F. Sherman at (503) 223-8441 or Contact Us for a free parenting time enforcement consultation.


The enforcement of parenting time process generally requires the court to schedule a hearing within 45 days. This is referred to as expedited parenting time.  In many jurisdictions, this may be the fastest way to obtain parenting time.

In contempt proceedings, the hearing is usually held by the judge who issued the order or judgment. The case is scheduled on that judge’s calendar docket along with all the other judge’s cases. Given the judge’s calendar, it may take longer to appear before the judge in a contempt proceeding than it would in an enforcement of parenting time proceeding.

Again, this will depend on the jurisdiction in which your case arises.  In many jurisdictions, such as Multnomah County, a judge will reserve jurisdiction on the case after one hour. In other jurisdictions such as Clackamas County, the judges rotate regardless.


In an enforcement of parenting time proceeding, the court has the authority:

• To create a more detailed parenting time schedule; to impose additional terms and conditions on the existing parenting time order;

• To order additional parenting time to compensate for a wrongful denial of parenting time;

• To order the violating party to post a bond or securities;

• To order the offending party to attend counseling or educational classes that focus on the impact the violation of parenting time has on the children; and

• To award attorneys fees and costs incurred in enforcing the parenting time.

ORS 107.435 provides for additional remedies the court may order in an enforcement of parenting time proceeding. You can review the Oregon statutes on our website.

The contempt statutes are set forth in ORS 39.145, et. seq. Additional rules which govern contempt proceedings are set forth in the Oregon Uniform Trial Court Rules. The remedies available in the contempt proceeding include:

• Any order the court feels necessary to ensure compliance with a prior court order;

• Remedial sanctions to compensate for the contempt;

• Attorney fees and costs incurred in purging the contempt; and

• In extreme cases, confinement in jail.


The burden of proof in a contempt proceeding is “by clear and convincing” evidence and requires a willful disobedience of a prior court order or judgment.

The burden of proof in an enforcement proceeding is a “preponderance” of the evidence . Quite often it is beneficial to commence both an enforcement and contempt proceeding to obtain all of the remedies to which you are entitled.


The rules and procedures in filing enforcement of parenting time and contempt proceedings are complicated and require a skilled and experienced parenting time enforcement attorney.

We know you have questions and we have answers. If you would like to know more about parenting time enforcement or remedial contempt, call the Law Offices of Paul F. Sherman at (503) 223-8441 or Contact Us for a free parenting time enforcement consultation.

Posted in Contempt, Custody, Family law, Parenting Plans, Parenting Time, Uncategorized | Tagged , , , , | Leave a comment

How do I get help for serious injury or death caused by a drunk, intoxicated or impaired driver?

Even though substantial efforts have been made to keep drunk drivers off our roads, every year thousands of Americans are killed or seriously injured by drunk, intoxicated or otherwise impaired drivers. This is especially true during the holidays when many people recklessly drive drunk or impaired. At the Law Offices of Paul F. Sherman we know how devastating a serious drunk driving accident can be for the victim and his or her family.

Our experienced drunk driver accident attorneys take time to thoroughly investigate your case.  We have earned recognition for our compassion, integrity, and effectiveness in helping our clients receive the just compensation they may be entitled to after suffering the devastating effects of a drunk driver accident.

Let us help with your drunk driver accident. Call the Law Offices of Paul F. Sherman at (503) 223-8441 or Contact Us for a free drunk, intoxicated or impaired driver accident consultation.


If you have suffered an injury or an accident involving a drunk or intoxicated driver, or if you have lost a loved one in a DUII accident, contact the drunk driver accident attorneys of the Law Offices of Paul F. Sherman. Don’t settle with an insurance company until you have talked to us about what your injuries or loss will mean to you and your family. Let our effective and experienced representation make a difference for you and your family.


We have helped our clients obtain extraordinary results in drunk driving cases involving:

  • Wrongful death claims
  •  Serious injury claims
  • Truck and commercial vehicle accidents
  • Injuries to children
  • Pedestrian accidents
  • Bicycle accidents
  • Uninsured or underinsured accidents

We know you have questions and we have answers. If you would like to know more about effective representation for accidents involving drunk, intoxicated or impaired drivers, call the Law Offices of Paul F. Sherman at (503) 223-8441 or Contact Us for a free drunk driving accident consultation.

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How do I get Expedited Parenting Time Enforcement in Oregon?

Oregon provides for expedited parenting time enforcement for parents who are being deprived of parenting time set forth in a judgment or order. Each judicial district in Oregon is required to establish an “expedited parenting time enforcement procedure” and provide forms for that purpose. ORS 107.434(1).

Let us help you enforce your parenting time. Call the Law Offices of Paul F. Sherman at (503) 223-8441 or Contact Us for a free parenting time enforcement consultation.

When a violation of parenting time or substantial violations of the parenting plan occur, a party may file a motion alleging the violation or violations and requesting the court to order the parties to appear to show cause why the parenting time should not be enforced. When filing this motion, the party must include a copy of the current order establishing parenting time or the parenting plan. ORS 107.434(1)(a).

An Order to Show Cause requires the parties to appear at a specific time and show cause why the parenting time should not be enforced in a specific manner. The remedies provisions of ORS 107.434 provides extensive remedies for substantial parenting time violations. In addition to any remedy that the court may impose to enforce the parenting plan, the court may do the following:

1) Modify the provisions relating to the parenting plan by (a) “[s]pecifying a detailed parenting time schedule”; (b) “[i]mposing additional terms and conditions on the existing parenting time schedule”; or (c) “[o]rdering additional parenting time, in the best interests of the child, to compensate for wrongful deprivation of parenting time,” ORS 107.434(2)(a);

(2) “Order the party who is violating the parenting plan provisions to post bond or security,” ORS 107.434(2)(b);

(3) “Order either or both parties to attend counseling or educational sessions that focus on the impact of violation of the parenting plan on children,” ORS 107.434(2)(c);

(4) “Award the prevailing party expenses, including, but not limited to, attorney fees, filing fees and court costs, incurred in enforcing the party’s parenting plan,” ORS 107.434(2)(d);

(5) “Terminate, suspend or modify spousal support,” ORS 107.434(2)(e);

(6) “Terminate, suspend or modify child support,” ORS 107.434(2)(f); and

(7) “Schedule a hearing for modification of custody as provided in ORS 107.135(11),” ORS 107.434(2)(g).

Any enforcement by the court that includes termination, suspension, or modification of child support must be consistent with ORS 107.431. ORS 107.434(2)(f).


We know you have questions and we have answers.  If you would like to know more about parenting time enforcement call the Law Offices of Paul F Sherman at (503) 223-8441 or Contact Us for a free parenting time consultation.

Posted in Custody, Family law, Modifications, Parenting Plans, Parenting Time, Uncategorized, Visitation | Tagged , , , , | Leave a comment


As a general rule a Qualified Domestic Relations Order (QDRO) is necessary to divide retirement benefits following entry of a divorce judgment. The starting point is to obtain an approved Order form directly from the Plan administrator. The order can then be tailored to your specific decree.

Let us help you with your Qualified Domestic Relations Order (QDRO). Contact us or call the Law Offices of Paul F. Sherman at (503) 223-8441 for a free Qualified Domestic Relations Order consultation or for assistance in dividing your retirement benefits.

A common mistake that many attorneys make is thinking that if a judge orders it, then the Plan must comply. This is simply not true – the Plan Administrator has the final say about a QDRO.  The Plan simply cannot provide any benefit that is not available under the terms of the Plan. There are many reasons why proposed QDRO’s are rejected. The more common ones are as follows:

• Referencing the wrong plan name.
• Submitting the wrong type of QDRO for the Plan.
• Failure to address increases or decreases in a defined contribution plan.
• Incorporating an invalid valuation date.
• Failing to include beneficiary language for defined contribution plans.
• Improperly dividing a percentage and a dollar amount.
• Selecting a disallowed form of benefit designation for a defined benefit plan.
• Failing to indicate from what Plan payments will be paid.
• Defining a form of payment that is inconsistent with the Plan guidelines.

Drafting an acceptable QDRO requires working with the Plan Administrator and preparing a QDRO that complies with your company’s retirement plan.


We know you have questions and we have answers. If you would like to know more information about preparing a Qualified Domestic Relations Order or how to divide your retirement benefits.  Contact Us or call the Law Offices of Paul F. Sherman at (503) 223-8441 for a free qualified domestic relations order consultation.

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Wrongful Death in Oregon

The Oregon Legal Guide


Suffering the loss of a loved one due to the negligence or wrongful conduct of another is one of life’s most devastating experiences  Attorney Paul F. Sherman fully understands the delicate balancing act that is necessary to compassionately represent grieving families while aggressively representing their interests.  The wrongful death lawyers at the Law Offices of Paul F. Sherman understand a family’s need to obtain justice and fair compensation.

Let us help your family with your wrongful death or serious injury claim.  Contact Us at the Law Offices of Paul F. Sherman at (503) 223-8441 for a free wrongful death or serious personal injury consultation.


Insurance companies often try to quickly settle wrongful death claims.  These settlement offers tend to have little relation to the needs of the surviving family or the value of their case.  They are…

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How to Create a Long-Distance Parenting Plan That Works


A well drafted long-distance parenting plan can provide your children and the non-residential parent with the opportunity to maintain regular and wholesome parenting time with the children when the homes of divorced or separating parents are far away from each other or if either parent relocates a significant distance.

A long-distance parenting plan should take into account the unique circumstances of each family. It requires careful consideration and detailed planning to ensure that both parents maintain regular contact with their children. Long-distance parenting plans can be challenging, especially when a regular pattern of visitation has already been established and now must be renegotiated or litigated in court.

Let us help you with your long-distance parenting plan. Contact Us at the Law Offices of Paul F. Sherman at (503) 223-8441 for a free long-distance parenting plan consultation.

There are several key issues which should be addressed in a long-distance parenting plan.


For those families that can afford the cost of travel, regular visitation is an important item to be incorporated into any successful long-distance parenting plan. The non-residential parent should be offered a minimum of one weekend per month on ten days’ notice should they be able to make proper travel accommodations for the children.

Many long-distance parenting plan are designed to maintain contact with the children by using provisions that allow for regular monthly (or even semi-monthly) visits with the children in their home state. The provisions should require the non-residential parent to provide reasonable notice of their intent to exercise this time to ensure that expectations are not made which cannot be met or that the children’s regular routine is not disrupted. The long-distance parenting plan may also allow the children to travel to the non-residential parent’s home state on a periodic basis as well. Such plans should take into account the age restrictions for children to travel on airlines and are generally suited for children ages 12 and older.

Quite often regular monthly visitation is too costly and is impractical for many families. When the distance between the parents is substantial, the cost of regular monthly visitation may be cost prohibitive or too disruptive for the children to regularly travel between the two homes. Consequently, most long-distance parenting plans provide for longer visits to the non-residential parent during breaks from school. They provide for visitation during winter break, spring break and during the summer.


Most courts are inclined to offer the non-residential parent substantial visitation with their children during normal breaks from school. Here the court will allow the non-residential parent substantial visitation during the winter break. It is also quite common for the non-residential parent to be awarded the entire spring break each year to make up for the loss of monthly parenting time. This is further buttressed by allowing the non-residential parent a significant block of time during the summer to make up for the shortfall in visitation during the school year. Most standardized long-distance parenting plans adopted by the courts will allow the non-residential parent six weeks of summer visitation time.

A well-drafted long-distance parenting plan will allow the child transition time when school lets out and one week before school resumes in the fall.

Many parents find it useful to allow the non-residential parent a two-week block of time followed by one week back in their normal housing. This can be broken up in a variety of ways but allows the children to spend quality residential summer parenting time with the primary parent between visits with the non-residential parent. This works well for younger children who may become anxious or greatly miss their custodial parent after an extended period of time.


Traditional family holidays such as Christmas and Thanksgiving can be split or alternated between the parties to ensure that each parent has quality celebration time with the children. Each parent should have an opportunity to celebrate at least one major holiday with the children in any given calendar year.

The non-residential parent may also be afforded additional parenting time on longer holiday weekends such as Memorial Day and Labor Day each year.


Long-distance parenting plans require the parents to make transportation arrangements on a regular basis. It is important that a well-drafted parenting plan set forth in detail how the children will travel to see the other parent and how the expenses for the transportation will be paid.


A well-drafted long-distance parenting plan should take into account accompanying the child when traveling by air at the departure, any layovers and upon arrival at the airport. For children under the age of 12, this often means that a parent must travel with the child on each leg of the trip. Older children should be able to fly unaccompanied by an adult so the plan should address the age at which the parents agree that unaccompanied travel is inappropriate. It is important to note that each airline may have different requirements for the specific age at which a child may fly without an adult.

• The long-distance parenting plan should memorialize other long-distance air travel details such as the specific airport that the children will fly in and out of.

• Acceptable times for travel to begin and end.

• How and when tickets will be purchased.

• Which parent is responsible for making travel arrangements.

The issue of transportation can easily be worked out by the parties in a well-drafted long-distance parenting plan. Quite often the cost of travel is split with each party paying for one-half of the visit so that the delivering parent pays for one leg and the receiving parent pays for the return trip.

Parents may also agree to modify child support to compensate the non-residential parent for transportation costs in seeing the children.

The courts are generally willing to consider stipulated agreements with regards to visitation and travel arrangements. It is always better for the parties to agree on the arrangements rather than have the court force a given scenario.


A long-distance parenting plan should also provide for regular communication between the children and the non-residential parent. Given the advances in modern technology, this can be done on a relatively low-cost basis by using regular contact with Skype or other internet messaging services. Video calls permit the parent and child to have face-to-face conversations regardless of the distance between them. Such contact is especially important with young children who are not spending regular time with the non-residential parent.

It is essential to formulate a workable regular schedule for telephone calls. Generally, a parent should be entitled to unlimited communication with the children during reasonable hours. Such communication can be facilitated by the child having a cell phone to talk with the other parent. With children who are very young, the residential parent should be required to facilitate telephone calls with the young child. A regular schedule can be arranged to facilitate contact with young children.

Email and instant messaging are also quality methods of maintaining contact with non-residential parent and their children. The use of texting is often the predominant method of communication for teenagers in any event.


We know you have more questions and we have answers.  If you would like to learn more about drafting a long distance parenting plan for your family or about divorce, child custody or any family law matter, call the Law Offices of Paul F. Sherman at (503) 223-8441 for legal advice, or Contact Us for a free consultation.

Posted in Child Relocations, Custody, Divorce, Family law, Modifications, Parenting Plans, Uncategorized, Visitation | Tagged , , , , , , | Leave a comment

How Do I Determine The Value Of My Business In A Divorce?


Many of our high-asset clients are the owners of a business.  It is not uncommon for married couples to co-own a small business or one of the parties to run and manage a small privately held firm.  During the dissolution process, the business has to be valued for distribution as a part of the overall division of assets.  Usually, the business is the single most valuable asset in the marital estate.  As such, the business valuation is the single-most important issue in the divorce.

Let us help with your business valuation.  Contact us at (503) 223-8441 for a free business valuation consultation.

There are a few specific issues that arise in business valuations.  Understanding the basic approach to value is essential to obtaining your fair share of the marital estate.  There are clear standards for the business valuation process and case law specific as to how businesses are to be valued in a divorce.  A proper business valuation generally requires a qualified business valuation expert to prepare a report and to make a valuation presentation in court.

A business valuation requires a skilled business valuation attorney to obtain the necessary financial records to evaluate the business.  The business valuation expert will also assist the attorney and client in obtaining financial records crucial to the business valuation process as efficiently and cost-effectively as possible.

At the Law Offices of Paul F. Sherman, we pride ourselves in assisting our clients in business valuation issues and choosing a highly-qualified business valuation expert for your specific industry.


One of the most contentious issues in a divorce proceeding is the valuation and distribution of a family-owned business.  This process can be complicated and expensive depending on the nature and the size of the business.  Often the business is the most valuable asset in the marital estate.  Whether you are the “in” or “out” spouse, it is essential to understand the various methods which are generally applied to determine the value of a family-owned or privately held business.  Different approaches to value often lead to different valuation conclusions and it is the responsibility of the parties, their attorneys and experts to persuade the judge to reach an appropriate business valuation.


While each business has unique features, all business will own tangible and intangible assets.  Tangible assets generally consist of cash, accounts receivable, inventory and equipment.  Intangible assets are non-physical assets, such as trademarks, patents, copyrights, goodwill and contracts that grant various rights and privileges.  The valuation of tangible and intangible assets usually requires an expert who may utilize different standards of value.

While all valuations are prepared as of a single date, it is important to understand what date the court will use in determining a proper business valuation in your case.  The foundation for a proper business valuation is the application of recognized valuation methodologies with rigorous analysis of the underlying financial records of the business.  Every business valuation will include subjective judgments made by the business valuation expert in arriving at his or her conclusion.  It is rare when two business valuation experts arrive at the exact same conclusion as to value.  Thus, it is important to understand how assets are valued and the basics of the business valuation methodologies.

To determine a business valuation for a divorce, the parties generally retain their own expert to prepare a business valuation opinion in the form of  report.  The experts will then testify in court as to the foundation of their opinion.  They will explain their work, analysis and opinions as to value.  The expert will also comment on the work of the opposing expert and the flaws and errors in their report.  As a general rule, it is in the judge’s discretion to decide what value to adopt.  A well-prepared business valuation approach will provide a business value for each of the accepted methodologies.


There are three accepted approaches to determine a proper business valuation (1) the asset approach; (2) the income approach and (3) the market approach.

While there are no other approaches as to value, there are numerous methods that an expert may consider in each of these accepted approaches.  Each business valuation approach has inherent strengths and weaknesses and some provide a more reliable conclusion of value than others depending upon the individual circumstances and the type of business involved.  The valuation experts should consider all three approaches in his or her report.  However, quite often not all three approaches can be applied to a specific business.  For example, in an asset approach, a business valuation expert may seek to value intangible assets.  It can be extremely difficult to find reliable data to value individual intangible assets for many businesses.  Intangible assets are also frequently captured in the proper application of the income and market approaches.  Ultimately, it is the responsibility of the parties and their counsel to persuade the court that their expert’s valuation conclusion is more reliable than the approach exercised by the opposing expert.


The asset or asset-based approach determines a value indication of a business or business interest based on the value of the business assets less liabilities. Generally, the asset approach presents a value of all tangible and intangible assets as well as the company’s liabilities.

While the asset valuation approach may seem to be simple, there are a number of complicating factors.  The determination of book value is often problematic.  This is especially true with certain asset classes such as property and equipment which are seldom the equivalent of book value.  Such items may require separate experts to provide appraisals for individual items.  The value of inventory is typically stated at cost and depending upon the inventory type and age, this is another asset whose value for business valuation purposes is frequently not the same as book value.  Intellectual property valuations are always challenging under an asset approach valuation. Accordingly, the asset approach is typically relied upon when the business is an investment or holding company.  It can also be used in the valuation of very small business and/or professional practices where there is little or no goodwill.


The income approach determines the value of a business using one or more methods that convert anticipated economic benefits into a present single amount.  The income approach is the most widely recognized approach to valuing an interest in a privately-held business.  There are several methodologies within the income approach.  The primary methods are capitalized cash flow, discounted cash flow and excess cash flow.  Each of these methodologies requires the determination of a future benefits stream and a rate of return and risk that the projected future economic benefits will actually be received by the business.  To determine a future benefit stream, the valuation expert will collect and review historical financial data and make normalizing adjustments.

The business valuation expert will collect and review historical financial data and make normalizing adjustments to develop a conclusion as to the future benefit stream for the business.  The goal in making these adjustments is to present a normal operating picture to project future earnings for the business.  In most privately-held businesses, it is not unusual for the controlling shareholder to receive compensation in excess of the market rate.  As such, one of the significant adjustments made by a valuation expert is to add back excess compensation to the business cash flow.  The business valuation expert must determine a fair rate of compensation for the controlling shareholder’s position and responsibilities.  As such, there are many subjective judgments that the business valuation expert must make when using an income-based approach.


The market-based approach determines the value of a business by comparing the subject business to similar businesses that have been sold.  This approach essentially develops a list of comps to indicate the selling-value of the business.  Here, the value of the business is determined by comparing sales of other like-kind businesses.  People are familiar with the market approach because it is commonly employed by real estate appraisers to determine value in real estate transactions.  The approach works well particularly with residential appraisals due to the fact there are usually many comps for homes with similar qualities including size and location.  For most privately held businesses, it is much more difficult for a business valuation expert to find transactions that are comparable to the business being valued.  Usually, the business being valued is a small privately-held firm and the majority of the transactional information is from public companies with greater differences in size, sales, profits and geographic location.  While the market approach is simple to understand, it can be extremely difficult to find transitions that are truly comparable in terms of the business whose sale is being reported.


Once a proper evaluation has been made using each of the accepted approaches, the business evaluation expert with need to make a final valuation conclusion.  There are many additional components that must be analyzed before the business valuation expert can arrive at a final conclusion of business value.  These factors generally include adjustments for control, premiums, discounts for lack of control, discounts for lack of marketability or lack of voting rights and other such adjustments.  Once the business valuation expert has applied all three approaches and arrived at value indications for each approach, the determination must be made on how much weight to give each value indication to determine a final value conclusion.  Once established, the expert should perform a reasonableness test to determine whether or not the opinion makes economic sense.

The sheer multitude of variables involved in the valuation process is complicated and can make business valuations difficult for the average person to understand.  Moreover, there is very little training available to help family law judges understand the intricacies of business valuation.  As such, it is imperative that the attorney be well versed in business valuation methodology to obtain a proper business valuation.


At the Law Offices of Paul F. Sherman, we pride ourselves in effectively assisting our clients in the business valuation process.  We are experts in high asset or high net worth dissolutions involving privately held business.

We know you have more questions and we have answers.  If you would like to learn more about business valuation, call the Law Offices of Paul F. Sherman at (503) 223-8441 or Contact Us for a free business valuation consultation.

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