Do You Really Need a Divorce Lawyer?

Many people who are separating want to avoid paying legal fees as they feel they cannot afford a lawyer. While it is very understandable that people feel this way, as lawyers generally bill at a high hourly rate, there are some very good reasons why you should at the very least consult a lawyer if you are going through a divorce. Not doing so could potentially cost you a lot more than the legal cost you will incur in consulting or retaining a lawyer to assist you with your separation.

When clients come see me for an initial consultation they tell me that their “friends” have told them various things that have sent them into panic mode. Very often the information that they have obtained from their “friends” is inaccurate or has been exaggerated or twisted in some way. Some of the common “myths” that I hear almost on a daily basis are as follows:

  • If parents have joint custody of children then neither parent pays child support;
  • If a spouse leaves the matrimonial home he/she will lose all of their rights to the home;
  • If a parent is an “access parent” they do not have the right to information about a child from schools, doctors, etc…
  • Common law partners share property in the same way as married people;
  • People are considered “common law” for family law purposes after only one year of living together;
  • All people have to do to “equalize” their property is to share their assets equally when they separate.

All of the above statements are inaccurate and misleading. If someone was to follow this advice it could leave them in a position where they enter into an unenforceable separation agreement with their spouse, only to end up in court several years later and having to start from square one.

I always encourage people to settle the issues arising from their separation as expeditiously as possible and to minimize the involvement of lawyers if they want to keep the costs to a minimum. That being said, in order to have a valid and enforceable separation agreement, you need to first understand how the law applies to your family’s situation. You also always need to exchange full and frank financial disclosure of your income and all assets and debts as of marriage and as of the date of separation as any agreement done without disclosure is liable to be overturned by a court if it is ever challenged at a later date. I have even seen agreements overturned at the request of the party who drafted the agreement on the basis that there was insufficient financial disclosure exchanged at the time of the drafting of the agreement !

It is also wise to obtain “Independent Legal Advice” and to have a certificate attached to your agreement to verify that legal advice was obtained. It is also important for your spouse to have independent legal advice. This way, neither party can later argue that they were not aware of their legal rights when they signed the agreement. Another advantage of having independent legal advice is that if the lawyer has failed to properly advise you about your legal rights and responsibilities or the agreement is poorly drafted, and you have economic damages as a result of the lawyer’s failure to give adequate legal advice, you can sue the lawyer and obtain compensation from the lawyer’s professional insurer. This is very similar to “title insurance” in that it your agreement is in effect insured if you have a lawyer review it and give you independent legal advice.

If you want to minimize your costs, try negotiating an agreement “in principle” with your spouse either directly, or through mediation and get a lawyer to draft up an agreement based on your agreement in principle. There is also the “collaborative practice” model where you come to an agreement by meeting with your lawyers in four way meetings without going to court which is usually far less expensive and more efficient than litigation.

If you want to save money,  going to court should always be a last resort. Going to court with a lawyer is especially expensive because so much time is spent waiting outside the court room to be seen by a judge. On occasion people go to court, spend the entire day waiting to be heard and are told at the end of the day to come back another day as the judge has run out of time to hear their matter. If you have a lawyer with you waiting, you may have already spent up to $2,500.00 waiting for nothing just for that one day.

Many people at court are unrepresented (as much as 60% of the litigants). These people find themselves waiting hours to meet with duty counsel who can only assist them if they are “financially eligible”. The test they use to determine eligibility is a stringent one and is meant to limit the service to those who are truly below the poverty line. People who have a full time job are most often not eligible. Trying to understand the court process without legal advice can be incredibly frustrating as there are a myriad of court forms and procedures that you need to know in order to be prepared for court. If you do not come prepared, the judge could simply refuse to hear your case or may not have the facts s/he needs to make a proper decision or to direct your matter properly.

The bottom line is that it pays to spend a few dollars to have a consultation with a lawyer before you make any decisions regarding your separation and divorce and to retain a lawyer to draft an agreement or give you independent legal advice. That way, you may only have to do it once and can likely avoid the terrible experience of having to go to family court only to end up with the same result.

Divorce Insurance

house fireDivorce sucks. It is a catastrophe in the lives of millions. It's like having a fire rip through your home. The difference between a fire and a divorce is that you have always been able to get insurance to help recover from the economic loss. Now that's changed! 

James Gross who writes for the Maryland Legal Crier, a great blog, wrote a blog about a new product available to insure against some of the economic loss of divorce. Here is his blog: 

Divorce Insurance

Want to buy some divorce insurance?  Jennifer Saranow Schultz reports in the New York Times that SafeGuard Corp. of North Carolina is offering the world’s first divorce insurance called WedLock.  For each $15.99 per month you pay, you can buy $1,250 in coverage.   The benefit covers the costs of divorce such as lawyer fees or setting up a new home.

Then, if you get divorced, you send Wedlock proof, and they’ll send you a check for the amount of insurance you purchased.  You have to be married at least four years, however, before the payout.  You can buy riders to shorten that to three years or get your premiums back if you don’t make it that long.  Every year the company automatically adds another $250 to the coverage for each unit you buy.

The company helpfully provides calculators on its site for Divorce Probability and Divorce Costs to help you figure out much insurance you need.

It's an interesting idea eh? Of course, no insurance policy can compensate for the emotional losses suffered in a fire or a divorce. You need to find a good therapist to work through the pain. But a little cash is better than none. 

What is the cost of a divorce or separation in Barrie, Ontario?

 

My financial planner suggested to me that divorces are a better investment than weddings. “What are you talking about?” I asked curiously. She retorted “Well, as I see it, clients probably spend the same or more monGavel and moneyey on their weddings knowing full well that almost 50% end unhappily. On the other hand, divorces are almost always “forever and ever!”

I enjoyed a good belly laugh! She had a point!

Most families are happy to spend money on a wedding because it such a happy occasion. I remember my weddings (both of them) as two of the happiest days of my life. They were filled with optimism, love, friends and family. My first wedding (when I was in law school) was paid for by our parents but the second one was paid for by us. I do not regret a dime we spent on that joyous event.

On the other hand, I did not relish spending money on legal fees when I went through my own divorce. Yup. Even though I had been a divorce lawyer for 13 years at the time of my own divorce, I still retained my own lawyer. I took heed to the old adage “A person who represents himself in legal proceedings, has a fool for a lawyer”.

If you are facing a divorce, I bet you are afraid it will cost a fortune. I don't blame you. I have heard some horror stories too.

So, what are the costs of a divorce?

It depends on what process you use and the amount of time it will take for your lawyer to help you resolve all the issues. Lawyers and their staff bill on an hourly basis.  

Kitchen Table: Many people get legal advice and then negotiate a deal directly with their spouse. One spouse becomes my client and I offer advice about their deal. Assuming it makes sense, I will then draft a separation agreement based on their agreement. Most agreements are usually in the range of about $1,200 to $1,500 at our firm. This is an inexpensive process but requires that you and your spouse are able to negotiate together without the help of anyone. 

Mediation: The mediator is a neutral third party who will help facilitate you and your spouse negotiating a deal. Once it is completed, a mediation report is sent out to the lawyers. I review the report with my client so s/he understands the range of outcome according to the law. If the deal still makes sense, I will again draft a separation agreement based on the mediated agreement. The cost is usually in the range of $1,200 to $1,500.

Independent Legal Advice: Whether a “kitchen table” or mediated agreement, the other spouse should get independent legal advice (ILA) before signing the separation agreement. I always prefer my client’s spouse to get ILA so that s/he can’t attempt to wiggle out of the agreement in the future because s/he did not understand the terms of the agreement when they signed it. So, ironically, I want my client’s spouse to have ILA to protect my client, not so much to protect the other side. 

If the other spouse just refuses to get ILA, I will insist that they sign a waiver of ILA which simply says they were encouraged to obtain ILA but chose voluntarily to waive their right to ILA before signing the agreement and that they understood the meaning of the agreement before signing it.

Traditional Negotiations: If I represent my client in a traditional negotiation, the costs can range from $2,000 to $50,000 or more. I know. That's a pretty big range! Often traditional negotiations will lead to arbitration or court so the costs can spiral out of control.

Court: The court process is very costly. Even the simplest court case will cost at least $10,000 and most are in the range of $15,000 to $25,000. If the case goes to trial, the costs can be two or three times higher. I have heard of some cases where clients have paid over $150,000 in legal fees and these are normal local people like you and me... not Hollywood stars with money to burn. Some crazy cases can result in legal fees of over a million dollars but those are rare.

Collaborative Practice: A far more cost effective process than the court process is the Collaborative Team Practice process. In a Collaborative case, you and your spouse each retain your own lawyer to help you negotiate an agreement. Your lawyer will offer legal advice and ensure the resulting agreement is legally enforceable. At the beginning you and your spouse, and the professionals, sign an agreement that they will not go to Court. If one chooses to go to Court, both parties have to find new professionals including new lawyers.This has a huge impact as everyone is committed to negotiating an agreement.

To keep the costs to a minimum, the parties work with a Divorce Coach who will help the clients manage their emotions and case manage the process. As you can imagine, hot emotions often side track clients, especially in the court process, causing legal fees to escalate exponentially.

A Parenting Coach will also work with the parties to resolve the issues related to the children. Not only does the Parenting Coach facilitate the negotiations around time with the kids, the Parenting Coach is an expert in the needs of children so can offer sound, practical advice about what the children need in a settlement.

A Financial Specialist will help you and your spouse collect the various financial documents needed and facilitates a discussion of the financial issues.

The hourly cost of the Parenting Coach, Financial Specialist and Divorce Coach is usually substantially less than the cost of lawyers and the costs are shared by the parties so there are big savings to you. Clearly, two lawyers are far more expensive than one coach or one Financial Specialist shared.

In the end, most Collaborative cases are substantially less costly than court cases. In my experience, they cost between $2,000 to $6,000 per client. The cost is dependent upon the time necessary to negotiate an agreement but by using coaches and a financial specialist to do much of the negotiations, keeping the case out of the lawyers’ offices, you really minimize the costs.

Furthermore, by keeping the case out of court, costs are kept to a minimum. Court is very expensive due to the many forms and steps in the process, and the cost of waiting for the judge to hear your case. I have waited all day for a judge to hear my case and not been reached, costing my client thousands of dollars in fees. 

Upon the conclusion of the Collaborative process, a separation agreement is reviewed and signed by the parties with their lawyers. Over 85% of cases result in a full settlement of all the issues. It works well and is very cost effective compared to Court.  

I firmly believe that the Collaborative process is the best way of resolving divorce and separation issues. In fact, I no longer accept cases that are court-bound. Our four associate lawyers still take on court cases but after 21 years of litigating family law cases, I know clients are better off using the Collaborative process. So, no court for me or my clients! 

Divorce: The final step after an agreement has been signed is to complete the divorce. This is achieved by completing and filing some paperwork at Court. It takes about six months to get the divorce judgment back from the court and the cost for uncontested divorces in Simcoe County is $1,250.00 plus sales taxes. Our fee includes the filing fees which are over $500.00 and all the disbursements etc.

Of course, these cost estimates are the existing costs at the time of writing this blog. They will vary over time.

Retainers: We always require a retainer which is a deposit of money into trust for future legal fees. Presently, our retainers are: Separation Agreement $1,200; Collaborative case $2,000; Court case $3,000; Uncontested Divorce $1,250. Each month you will be billed for our time and you have to replenish the retainer.

Why is it so costly? One client who had a sense of humour, an especially unhappy marriage and very bitter divorce shared with me his “analysis” of why divorces cost so much. He said “They’re worth it!” I like his attitude!