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Appendix Part 1

GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 2019

SESSION LAW 2019-172

HOUSE BILL 469

AN ACT to REVISE THE LAWS PERTAINING TO EQUITABLE DISTRIBUTION, amend the laws pertaining to parenting coordinators, AND TO MAKE VARIOUS CHANGES UNDER THE LAWS PERTAINING TO ADOPTIONS.

The General Assembly of North Carolina enacts:

PART I. REVISE EQUITABLE DISTRIBUTION LAWS

SECTION 1. G.S. 50‑20.1 reads as rewritten:

"§ 50‑20.1. Pension, retirement, and deferred compensation benefits.

(a) The distribution of vested marital pension, retirement, or deferred compensation benefits may be made payable by any of the following means:

(1) As a lump sum from the plan, program, system, or fund for those benefits subject to subsection (d1) of this section.

(2) Over a period of time in fixed amounts from the plan, program, system, or fund for those benefits subject to subsection (d1) of this section.

(3) As a prorated portion of the benefits made to the designated recipient, if permitted by the plan, program, system, or fund (i) at the time the participant‑spouse is eligible to receive the benefits, (ii) at the time the participant‑spouse actually begins to receive the benefits, or (iii) at the participant‑spouse's earliest retirement age. For purposes of this section, "participant‑spouse" means the spouse who is a participant in the plan, program, system, or fund.

(4) By awarding a larger portion of other assets to the party not receiving the benefits and a smaller share of other assets to the party entitled to receive the benefits.

(5)As a lump sum, or over a period of time in fixed amounts, by agreement.

(b) The distribution of nonvested marital pension, retirement, or deferred compensation benefits may be made payable by any of the following means:

(1) As a lump sum by agreement.

(2) Over a period of time in fixed amounts by agreement.

(3) As a prorated portion of the benefits made to the designated recipient, if permitted by the plan, program, system, or fund (i) at the time the participant‑spouse is eligible to receive the benefits, (ii) at the time the participant‑spouse actually begins to receive the benefits, or (iii) at the participant‑spouse's earliest retirement age.

(c) Notwithstanding the provisions of subsections (a) and (b) of this section, the court shall not require the administrator of the plan, program, system, or fund involved to make any payments or distributions to the nonparticipant spouse, except as permitted by the terms of the plan, program, system, or fund.

(d) When the amount of the benefit payable by the plan, program, system, or fund to the participant‑spouse is determined in whole or part by the length of time of the participant‑spouse's employment, the marital portion shall be determined using the proportion of time the marriage existed (up to the date of separation of the parties) simultaneously with the total time of the employment which earned the benefit subject to equitable distribution, to the total amount of time of employment that earned the benefit subject to equitable distribution. The determination shall be based on the vested and nonvested accrued benefit, as provided by the plan, program, system, or fund, calculated as of the date of separation, and shall not include contributions, years of service, or compensation which may accrue after the date of separation. The award shall include gains and losses on the prorated portion of the benefit vested at the date of separation and cost‑of‑living adjustments and similar enhancements to the participant's benefit. Notwithstanding any other provision of this Chapter, if the court makes the award payable pursuant to subdivision (a)(3) or (b)(3) of this section and the court divides the marital portion of the benefit equally between the participant‑spouse and nonparticipant spouse, the court shall not be required to determine the total value of the marital benefits before classifying and distributing the benefits. However, neither party shall be prohibited from presenting evidence of the total value of any marital benefits or of any benefits that are separate property of either spouse. When a pension, retirement, or deferred compensation plan, program, system, or fund, or an applicable statute limits or restricts the amount of the benefit subject to equitable distribution by a State court, the award shall be determined using the proportion of time the marriage existed (up to the date of separation of the parties) simultaneously with the total time of the employment which earned the benefit subject to equitable distribution to the total time of employment, as limited or restricted by the plan, program, system, fund, or statute that earned the benefit subject to equitable distribution.

(d1)When the amount of the benefit payable by the plan, program, system, or fund is not determined in whole or part by the length of time of the participant‑spouse's employment, but is instead based on contributions and held in one or more accounts with readily determinable balances, including, but not limited to, individual retirement accounts and defined contribution plans, such as those within the definitions of Internal Revenue Code section 401(k), 403(b), 408, 408A, or 457, the court shall not determine the award using the fraction described in subsection (d) of this section. The court instead shall determine the marital portion of the benefit by determining the amount of the account balance that is due to contributions made or earned during the marriage and before separation, together with the income, gains, losses, appreciation, and depreciation accrued on those contributions. If sufficient evidence is not presented to the court to allow the court to make this determination, the court shall then determine the marital portion of the benefit by using the fraction described in subsection (d) of this section, namely, by using the proportion of time the marriage existed (up to the date of separation of the parties) simultaneously with the employment which earned the benefit subject to equitable distribution to the total amount of time of employment. In either event, the award shall be based on the vested and nonvested accrued benefit as of the date of separation, together with the income, gains, losses, appreciation, and depreciation accrued after the date of separation on the date‑of‑separation benefits. However, the award shall not include contributions that may accrue or be made after the date of separation, or any income, gains, losses, appreciation, and depreciation accrued on those contributions.

(e) No award shall exceed fifty percent (50%) of the benefits the person against whom the award is made is entitled to receive as vested and nonvested pension, retirement, or deferred compensation benefits, except that an award may exceed fifty percent (50%) if (i) other assets subject to equitable distribution are insufficient; or (ii) there is difficulty in distributing any asset or any interest in a business, corporation, or profession; or (iii) it is economically desirable for one party to retain an asset or interest that is intact and free from any claim or interference by the other party; or (iv) more than one pension or retirement system or deferred compensation plan, program, system, or fund is involved, but the benefits award may not exceed fifty percent (50%) of the total benefits of all the plans added together; or (v) both parties consent. In no event shall an award exceed fifty percent (50%) if a plan, program, system, or fund prohibits an award in excess of fifty percent (50%).

(f) In the event the person receiving the award dies, the unpaid balance, if any, of the award shall pass to the beneficiaries of the recipient by will, if any, or by intestate succession, or by beneficiary designation with the plan, program, system, or fund consistent with the terms of the plan, program, system, or fund unless the plan, program, system, or fund prohibits such designation. In the event the person against whom the award is made dies, the award to the recipient shall remain payable to the extent permitted by the pension or retirement system or deferred compensation plan, program, system, or fund involved.

(f1)Whenever the award is made payable pursuant to subdivision (a)(3) or (b)(3) of this section, and the pension or retirement or deferred compensation plan, program, system, or fund permits the use of a "separate interest" approach in the order, there shall be a presumption, rebuttable by the greater weight of the evidence, that the "separate interest" approach shall be used to divide the benefit in question. For purposes of this section, the phrase "separate interest" approach means any method of dividing pension or retirement system or deferred compensation benefits in which the nonparticipant spouse, the spouse not a participant in the plan, program, system, or fund in question, receives an interest that allows the nonparticipant spouse to receive benefits in a manner independent, in whole or part, of the benefits received by the participant‑spouse, or to make elections concerning the receipt of benefits independently of the elections made by the participant‑spouse.

(f2)Whenever the pension or retirement or deferred compensation benefit is distributed pursuant to subdivision (a)(3) or (b)(3) of this section in an order that does not employ the "separate interest" approach, the court may, considering the length of the marriage and the ages of the parties, (i) award all or a portion of a survivor annuity to the nonparticipant spouse or former spouse and (ii) allocate the cost of providing the survivor annuity between the parties. The survivor annuity awarded by the court, if any, shall be allocated in accordance with the terms of the retirement plan, program, system, or fund.

(f3)Whenever the pension or retirement or deferred compensation plan, program, system, or fund does not automatically provide pre‑retirement survivor annuity protection for the nonparticipant spouse, the court shall order pre‑retirement survivor annuity protection for the nonparticipant spouse if permitted by the plan, program, system, or fund.

(f4)The court may allocate equally between the parties any fees assessed by a plan, program, system, or fund in order to process any domestic relations order or qualified domestic relations order.

(g) The court may require distribution of the award by means of a qualified domestic relations order, or as defined in section 414(p) of the Internal Revenue Code of 1986, or by domestic relations order or other appropriate order. To facilitate the calculating and payment of distributive awards, the administrator of the plan, program, system, or fund may be ordered to certify the total contributions, years of service, and pension, retirement, or other deferred compensation benefits payable.

(h) This section and G.S. 50‑21 shall apply to all vested and nonvested pension, retirement, and deferred compensation plans, programs, systems, or funds, including, but not limited to, uniformed services retirement programs, federal government plans, State government plans, local government plans, Railroad Retirement Act pensions, executive benefit plans, church plans, charitable organization plans, individual retirement accounts within the definitions of Internal Revenue Code sections 408 and 408A, and accounts within the definitions of Internal Revenue Code section 401(k), 403(b), or 457.

(i)If a plan, program, system, or fund deems unacceptable an order providing for a distribution of pension, retirement, or deferred compensation benefits, then the court may upon motion of a party enter a subsequent order clarifying or correcting its prior order, as may be necessary to comply with the specific technical requirements of the plan, program, system, or fund.

(j)Notwithstanding any other provision of this Chapter, a claim may be filed, either as a separate civil action or as a motion in the cause in an action brought pursuant to this Chapter, for an order effectuating the distribution of pension, retirement, or deferred compensation benefits provided for in a valid written agreement, as defined in G.S. 50‑20(d), whether or not a claim for equitable distribution has been filed or adjudicated. The court may enter an order effectuating the distribution provided for in the valid written agreement."

SECTION 1.1 G.S. 135‑9(a) reads as rewritten:

"(a) Except for the applications of the provisions of G.S. 110‑136, and G.S. 110‑136.3 et seq., and in connection with a court‑ordered equitable distribution under G.S. 50‑20, the right of a person to a pension, or annuity, or a retirement allowance, to the return of contributions, the pension, annuity or retirement allowance itself, any optional benefit or any other right accrued or accruing to any person under the provisions of this Chapter, and the moneys in the various funds created by this Chapter, are exempt from levy and sale, garnishment, attachment, or any other process whatsoever, and shall be unassignable except as in this Chapter specifically otherwise provided. Notwithstanding any provisions to the contrary, application for System approval of a domestic relations order dividing a person's interest under the Retirement System shall be accompanied by an order consistent with the system‑designed template order provided on the System's Web site. Notwithstanding any provisions to the contrary, the Retirement System shall only make payment of a share of the member's retirement benefits to the member's former spouse based upon a domestic relations order, and the former spouse shall not be permitted to receive a share of the member's retirement benefits until the member begins to receive the benefits, consistent with the system‑designed template order. Notwithstanding any provisions to the contrary, the former spouse shall not be entitled to any type or form of benefit or any option not otherwise available to the member. Notwithstanding any provisions to the contrary, for orders entered on or after January 1, 2015, payment to a member's former spouse pursuant to any such domestic relations order shall be limited to the lifetime of that former spouse and, upon the death of that former spouse, the former spouse's share shall revert to the member."

SECTION 1.2 G.S. 128‑31(a) reads as rewritten:

"(a) Except for the applications of the provisions of G.S. 110‑136, and G.S. 110‑136.3 et seq., and in connection with a court‑ordered equitable distribution under G.S. 50‑20, the right of a person to a pension, an annuity, or a retirement allowance, to the return of contributions, the pension, annuity or retirement allowance itself, any optional benefit or any other right accrued or accruing to any person under the provisions of this Article, and the moneys in the various funds created by this Article, are exempt from levy and sale, garnishment, attachment, or any other process whatsoever, and shall be unassignable except as in this Article specifically otherwise provided. Notwithstanding any provisions to the contrary, application for System approval of a domestic relations order dividing a person's interest under the Retirement System shall be accompanied by an order consistent with the system‑designed template order provided on the System's Web site. Notwithstanding any provisions to the contrary, the Retirement System shall only make payment of a share of the member's retirement benefits to the member's former spouse based upon a domestic relations order, and the former spouse shall not be permitted to receive a share of the member's retirement benefits until the member begins to receive the benefits, consistent with the system‑designed template order. Notwithstanding any provisions to the contrary, the former spouse shall not be entitled to any type or form of benefit or any option not otherwise available to the member. Notwithstanding any provisions to the contrary, for orders entered on or after January 1, 2015, payment to a member's former spouse pursuant to any such domestic relations order shall be limited to the lifetime of that former spouse and, upon the death of that former spouse, the former spouse's share shall revert to the member."

PART II. REVISE PARENTING COORDINATOR LAWS

SECTION 2. Article 5 of Chapter 50 of the General Statutes reads as rewritten:

"Article 5.

"Parenting Coordinator.

"§ 50‑90. Definitions.

As used in this Article, the following terms mean:

(4)Party. – Any person granted legal or physical custodial rights to a child in a child custody action.

"§ 50‑91. Appointment of parenting coordinator.

(a) The court may appoint or reappoint a parenting coordinator at any time in a child custody action involving minor children brought under Article 1 of this Chapter on or after the entry of a custody order, other than an ex parte order, or upon entry of a contempt order involving a custody issue pursuant to any of the following:

(1)All parties consent to the appointment and the scope of the parenting coordinator's authority.

(2)Upon motion of a party requesting the appointment of a parenting coordinator.

(3)Upon the court's own motion.

(b) If the parties have not consented to the appointment of a parenting coordinator, the court shall make specific findings that the action is a high‑conflict case, that the appointment of the parenting coordinator is in the best interests of any minor child in the case, and that the parties are able to pay for the cost of the parenting coordinator. The court does not have to find a substantial change of circumstance has occurred to appoint a parenting coordinator.

(c) The order appointing a parenting coordinator shall specify the terms of the appointment and the issues the parenting coordinator is directed to assist the parties in resolving and deciding. Notwithstanding the appointment of a parenting coordinator, the court shall retain exclusive jurisdiction to determine fundamental issues of custody, visitation, and support, and the authority to exercise management and control of the case.

(d) The parenting coordinator shall be selected from a list maintained by the district court. Prior to the appointment, the court, the parties' attorneys, or the parties shall contact the parenting coordinator to determine if the parenting coordinator is willing and able to accept the appointment.

"§ 50‑92. Authority of parenting coordinator.

(a) The authority of a parenting coordinator shall be specified in the court order appointing the parenting coordinator and shall be limited to matters that will aid the parties in complying with the court's custody order, resolving disputes regarding issues that were not specifically addressed in the custody order, or ambiguous or conflicting terms in the custody order. The parenting coordinator's scope of authority may include, but is not limited to, any of the following areas:

(1) Transition time, pickup, or delivery.

(2) Sharing of vacations and holidays.

(3) Method of pickup and delivery.

(4) Transportation to and from visitation.

(5) Participation in child or day care and babysitting.

(6) Bed time.

(7)Diet.

(8)Clothing.

(9)Recreation.

(10)Before‑ and after‑school activities.

(11)Extracurricular activities.

(12)Discipline.

(13)Health care management.

(14)Alterations in schedule that do not substantially interfere with the basic time‑share agreement.

(15)Participation in visitation, including significant others or relatives.

(16)Telephone contact.

(17)Alterations to appearance, including tattoos or piercings.

(18)The child's passport.

(19)Education.

(20)Other areas of specific authority as designated by the court or the parties.

(b) The parenting coordinator shall decide any issue within the scope of the parenting coordinator's authority, and the decision shall be enforceable as an order of the court. The decision shall be in writing and provided to the parties and their attorneys. So long as the custody order under which the decision is made is in effect, the decision shall remain binding after the expiration of the parenting coordinator's term unless the parenting coordinator or a subsequent parenting coordinator modifies the decision or the court reviews and modifies the decision.

(b1)Any party or attorney for the party may file a motion for the court to review a parenting coordinator's decision. The parties shall comply with the parenting coordinator's decision unless the court, after a review hearing, determines that (i) the parenting coordinator's decision is not in the child's best interests or (ii) the decision exceeded the scope of the parenting coordinator's authority. The moving party or the attorney for the moving party shall cause a subpoena to be issued for the parenting coordinator's attendance at the review hearing. At the conclusion of the review hearing, the court shall determine how the parenting coordinator's fees, as related to the review hearing, shall be apportioned between the parties. The court may review and modify a parenting coordinator's decision after the expiration of a parenting coordinator's term.

(c) The parenting coordinator shall not provide any professional services or counseling to any party or any of the minor children.

(d) The parenting coordinator shall refer financial issues related to the parenting coordinator's decisions to the parties or their attorneys.

"§ 50‑93. Qualifications.

(a) To be eligible to be included on the district court's list of parenting coordinators, a person must meet all of the following requirements:

(1) Hold a masters or doctorate degree in psychology, law, social work, or counseling.

(2) Have at least five years of related professional post‑degree experience.

(3) Hold a current North Carolina license in the parenting coordinator's area of practice.

(4) Participate in 24 hours of training in topics related to the developmental stages of children, the dynamics of high‑conflict families, the stages and effects of divorce, problem solving techniques, mediation, and legal issues.

"§ 50‑94. Appointment conference.

(a) The parties, their attorneys, and the proposed parenting coordinator must all attend the appointment conference. However, no appointment conference is required if (i) the parenting coordinator's term is later extended, (ii) a subsequent parenting coordinator is appointed in the same matter, or (iii) the parties, their attorneys, and the proposed parenting coordinator consent to a waiver of the appointment conference by signing the proposed appointment order. The court shall not enter an order appointing a parenting coordinator or conduct an appointment conference unless a custody order has already been entered or is being simultaneously entered.

(b) At the time of the appointment conference, the court shall do all of the following:

(1) Explain to the parties the parenting coordinator's role, authority, and responsibilities as specified in the appointment order and any agreement entered into by the parties.

(3) Determine financial arrangements for the parenting coordinator's fee to be paid by each party and authorize the parenting coordinator to charge any party separately for individual contacts made necessary by that party's behavior.

(4) Inform the parties, their attorneys, and the parenting coordinator of the rules regarding communications among them and with the court.

(5) Enter the appointment order if the order has not yet been entered.

"§ 50‑95. Fees.

The parenting coordinator shall be entitled to reasonable compensation from the parties for services rendered and to a reasonable retainer. If a dispute arises regarding the payment of fees or the retainer, the parenting coordinator may file a fee report and request a hearing. If a party disputes the parenting coordinator's fees or the allocation of those fees, the party may file a motion with the court requesting that the court review the fees. The district court retains jurisdiction to resolve disputes regarding the parenting coordinator's fees after the conclusion of the parenting coordinator's term so long as the parenting coordinator's fee report was filed in a timely manner.

"§ 50‑96. Meetings and communications.

Meetings and communications between the parenting coordinator and the parties, the attorneys for the parties, or any other person with information that assists the parenting coordinator in the coordinator's duties may be informal and ex parte. Communications between the parties and the parenting coordinator are not confidential. The parenting coordinator and the court shall not engage in any ex parte communications. Upon request of the parenting coordinator, the parties shall timely execute any releases necessary to facilitate communication with any person having information that assists the parenting coordinator in the coordinator's duties. The parenting coordinator, in the coordinator's discretion, may meet or communicate with the minor children.

"§ 50‑97. Reports.

(a) The parenting coordinator may file a report with the court regarding any of the following:

(1) The parenting coordinator's belief that the existing custody order is not in the best interests of the child.

(2) The parenting coordinator's determination that the parenting coordinator is not qualified to address or resolve certain issues in the case.

(3)A party's noncompliance with a decision of the parenting coordinator or the terms of the custody order.

(4)The parenting coordinator's fees as set forth in G.S. 50‑95.

(5)The parenting coordinator's request that the parenting coordinator's appointment be modified or terminated.

(b) Upon the filing of a verified report by the parenting coordinator alleging that a party is not complying with a decision of the parenting coordinator, not complying with the terms of the custody order, or not paying the parenting coordinator's fees, the court may issue an order directing a party to appear at a specified reasonable time and show cause why the party shall not be held in contempt. Nothing in this section prevents a party from filing the party's own motion regarding noncompliance with a parenting coordinator's decision or noncompliance with the terms of the custody order.

(c) An expedited hearing shall be granted and shall occur within four weeks of the filing of the report unless the parenting coordinator requests a longer length of time or the court has already issued an order directing a party to show cause why the party shall not be held in contempt.

(d)The court, after a hearing on the parenting coordinator's report, shall be authorized to issue temporary custody orders as may be required for a child's best interests.

"§ 50‑98. Parenting coordinator records.

(a) In the parenting coordinator's discretion, the parenting coordinator may release any records held by the parenting coordinator to the parties or the attorneys for the parties.

(b) Any party may apply to the judge presiding for the issuance of a subpoena to compel production of the parenting coordinator's records. Any party who submits an application for a subpoena shall provide reasonable notice to the parenting coordinator and the parties so that any objection to the release of information or the manner of the release of information may be considered prior to the issuance of a subpoena.

"§ 50‑99. Modification or termination of parenting coordinator appointment.

(a) For good cause shown, the court may terminate or modify the parenting coordinator appointment upon motion of any party, upon the agreement of the parties, or by the court on its own motion.

(b) For good cause shown, the court may modify or terminate the parenting coordinator's appointment upon request of the parenting coordinator as set forth in G.S. 50‑97(a)(5).

(c)For purposes of termination or modification of the parenting coordinator's appointment, good cause may include, but is not limited to, any of the following:

(1)The lack of reasonable progress.

(2)A determination that the parties no longer need the assistance of a parenting coordinator.

(3)Impairment on the part of a party that significantly interferes with the party's participation in the process.

(4)The inability or unwillingness of the parenting coordinator to continue to serve.

…."

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