With the daunting realization that divorces can be expensive and emotionally and mentally exhaustive, a lot of divorcing couples are now turning to collaborative law. The point behind collaborative law is to circumvent litigation by mediating all of the issues in the case. The expectation is that both parties will be forthright with their income, expenses, and any other financial issues in the case. It is understood that the parties wish to be open and participate in the progress in good faith.
However, there are certain situations when collaborative law is not for everyone; and when it fails, it fails miserably. If you or your spouse meet any of the criteria below, collaborative law is probably not for you:
a. Income – your spouse is not a W-2 wage earner and you think he earns more money than he really does. If this is the case, collaborative law will not work as you will need to initiate discovery in order to determine your spouse’s true income. If you are the spouse that is not a W-2 wage earner, your spouse should have been intimately involved in your finances to know that you are telling the truth.
b. Business Expenses- if you or your spouse have a business, your spouse should be able to trust that the business expenses you claim as deductions are legit, and that the business is worth what you say its worth. If you have previously padded your expenses for tax purposes during the marriage, your spouse will probably suspect that you will do the same again in order to downplay the value of the property. The business would have to be evaluated and that issue on its own may need to be litigated.
c. Dissipation/Contribution Claims- If you or your spouse believe that the other has wasted marital funds on non-marital sources and would like that money to be reimbursed to the marital estate, there will probably not be an agreement on this issue in mediation. Similarly, if you believe that you should be reimbursed for money that you contributed to the other’s non-marital estate, then its likely that your spouse will disagree. Both of these issues would require extensive discovery.
These three are some of the major points that are litigated in court as the parties are not likely to agree in mediation. However, if you and your spouse trust each other enough to know that they will disclose their true income and expenses, and has not depleted any marital sources, collaborative law may be a good starting point for you.