The first thing I’d advise someone seeking a divorce is to consider, “how you will pay for it?” In addition to calculating how to run two households on a budget that has previously been used to run one household, another question relevant to the immediate question of divorce is, “How will you pay the attorney’s fees for the divorce?” Reducing the initial outlay of cost is one significant reason to choose mediation in your divorce case.
Of course I advocate mediation, because I believe in it. Mediation enables the parties to close a significant chapter in the book of their lives using a dignified and respectful process that encourages fairness. It’s especially beneficial where parties for one reason or another need to deal with each other in the future (i.e. when children are involved). For example, mediation makes it more likely that the parties can both attend their child’s wedding without getting knots in their stomach at the thought of seeing the ex-spouse. Even if there are no children, mediation can help parties retain happier memories of what was good with their marriage rather than spoiling the batch of memories with the awful part at the bitter end. But besides preserving what is left of civility in a relationship, mediation offers a distinct cost advantage over litigation of your divorce case.
Expect to pay hourly rates for a mediator that are comparable to what you would pay an attorney. The mediator provides a valuable service, has extensive training, and will charge accordingly. The way mediation saves money is that the hours it will take to mediate a divorce settlement are likely to be a fraction of the time it would take to resolve the same issues using adversarial court processes. Even a relatively friendly, litigated divorce involves paying two lawyers, court motions, hearings, and settlement conferences. Once the lawyers are involved, however, the attorneys’ duty of advocacy can result in more contentiousness overall. Attorney mediator Cynthia Fox writes (click HERE for link) in this regard:
in my experience, anger and contentiousness drives up the cost more than any other factor. More anger equals more destruction, cutting deeply into the wealth and well-being of both parties. Deeply hurt litigants file too many motions, push issues beyond reason, are unable to compromise, and often are so damaged that they emote endlessly in the lawyer’s office. The result: very large legal bills that anger them even more.
According to another source (linked HERE), even an uncontested divorce will cost approximately $30,000 more than a similar divorce obtained using a mediator. For both parties, this is a good-enough reason to consider mediation rather than litigation as the first step toward considering divorce. Since nothing said during mediation can be used against the parties later, your “Plan B” can be to go to a lawyer if mediation doesn’t work.
In terms of cost, consider the case of Jane and John Doe (the names have been changed). I got a call from Mr. Doe asking if I would mediate his divorce case. He was so frustrated and angry with his lawyer that at first I wasn’t sure if he wanted me to mediate between him and his ex wife, or between him and his lawyer. After a bit of conversation, I learned that John and Jane have been separated more than a year, they are able to speak and negotiate with one another, the divorce is amicable with no complicating circumstances, the parties agree which spouse gets the house and will have custody, and they each have an attorney. As divorces go, not too complicated. The fundamental issue is now one of “whether” but rather one of “how much” — the property settlement, alimony, and insurance need to be juggled so as to provide maximum protection for one spouse and tax benefit for the other.
Twice, John and Jane negotiated between themselves what they thought was a reasonable settlement. But each time, the lawyer for either John or Jane put the brakes on the settlement and sent them back to the drawing table! After a bit more inquiry, I learn that the two lawyers, between them, have been paid a total of $12,000, so far, and they each want another $3,000 (combined $6,000) to continue in the case. The divorcing parties don’t even have a temporary separation agreement! At this rate, who knows how many hours it will take to finalize negotiations, to draft the final settlement, to attend the final hearing to present the settlement to the judge, and then to draft the final order which the judge will sign.
Imagine this alternate scenario for John and Jane, if they had decided on a mediated divorce: They pay me for an initial, one hour consultation. I ascertain that they can sit in the same room together and negotiate, but there are serious disagreements about property settlement. With me, they execute an Agreement to Mediate which includes a commitment to full disclosure and fairness. They also agree to engage neutral experts in areas of potential disagreement and to full disclosure with those experts and waiver of confidentiality within the team of experts. Now, I send them to an accountant whose specialty is to help parties divvy up property in divorce cases. That accountant, who is neutral as well, spends four hours interviewing them, analyzing their assets, and calculating a recommended property settlement that is fair to each and also minimizes tax consequences. If John and Jane disagree with this assessment, they mediate. Assume now that John and Jane can agree to the property settlement. As mediator, I draft a Memorandum of Agreement (MOA) along with a separate memo stating the supporting reasons and financial disclosures.
In this scenario, the parties have paid for services of a subject matter expert who really helps them sort out the crucial issues of finances. Because the financial expert helps them with their budget, with knowing where their money is going, and with achieving a fair property settlement, they know they’ve done their very best for their entire family. Compare this to a different scenario: each party pays an attorney for two hours to draft paperwork and go to court to argue over who gets what property. Except it wouldn’t take just two hours to do that. Each attorney also engages a financial expert to spend four hours to analyze the case and also to appear in court to testify on behalf of the party they represent. Both processes lead to a resolution, but which process seems more efficient, to you?
Divorce is, indeed, a serious business, with long term ramifications. Divorce mediation is not a way to cut corners or to pursue unfair advantage. By way of further example: To make sure that everyone agrees the Memorandum of Agreement (MOA) is fair, John and Jane each engage a separate lawyer for the one or two hours worth of work it will take to look at the MOA and agree or disagree as to fairness of the deal. In the end, this divorce not only preserves what is left of friendly relations between John and Jane, it also removes incentives to escalate conflict, helps the parties achieve a result they feel is fair, and enables parties to put their resources into getting really appropriate help (in this case, expert financial advice) rather than into hiring courtroom gladiators to fight over evidence.
Truly, the two scenarios above both involve divorces where the parties kept things rather in check. But what about cases where anger and “fighting” takes over? In one blog (linked HERE), Maryland attorney James Gross estimates the cost of an average divorce to be $53,000. Another article, HERE, describes a divorce case in which just the custody hearing alone cost one of the two spouses $25,000 (that spouse proved some mental illness but still lost at the hearing).
Do most parties who plunk down that initial retainer to an attorney realize that their divorce may cost them $50,000, or more? I doubt it. But once you are on the train of a litigated divorce, how do you get off? It gets rather awkward, when you are in the middle of litigation, to tell your lawyer, “Oh, I think I’ll just quit now!” No, once you are in litigation, the momentum is going, people are angry and focused on litigation strategy and posture, not on settling. There is no easy way to back out of litigation. You snooze, you lose, sometimes literally.
I heard recently of a woman who missed her temporary hearing. As a result, the judge ruled against her on every point. Her reason for missing the hearing was most likely excusable, and she could ask for another court date. When would she get it, and how much would it cost? To imagine a second day of hearing for a temporary order is to imagine dollar signs rolling past, like in the TV show “Wheel of Fortune”. When will it stop? There’s no telling. If this had occurred in a mediated divorce, the parties could have worked together for a different type of result.
The costs of attorney fees are legitimate, necessitated by the adversarial system: A party who retains a lawyer is setting up a situation where his opposing side will also need to retain an attorney. Each attorney will then be duty bound — not to seek truth, fairness, and compromise, but rather – to represent his client zealously. Each attorney is duty bound to assert his or her client’s interest no matter what it does to the other spouse, to the relationship, or perhaps even to the client’s assets that might have been intended for retirement. And, once there are two lawyers involved, on on each opposing side, each of those lawyers must invest time and expense — they must investigate the case and to research the law, spend time filing pleadings and papers, to appear in court and in depositions, to have phone calls with the client and with opposing counsel, and pay for an office and secretary to assist. The list goes on. Litigation means escalation. Escalation means that costs skyrocket.
Granted, mediation is not free or cheap, either. It can be complex and expensive, depending on what is involved. But generally, there are some factors that help keep cost lower: parties who are mediating their divorce can choose to share information, they can agree to share experts (if experts are needed). Even if they can’t agree on everything, they can agree on some things and narrow the scope of the issues that will must be addressed by the judge. Sure, there may be rocky parts of the road, but there is a different mindset between parties who decide to fight like cats versus parties who agree to agree. The parties to a mediation may choose to dispense with things, like trial briefs and court hearings, that are designed to educate a third party (the judge) who is making a decision for the parties. In mediation, the parties stay in control of their own costs of settlement and hearing. In short, there are significant cost reasons for choosing mediation, in addition to significant benefits for preserving whatever semblance of friendship or amity the parties ever had.
Not convinced yet? Well, think about it: How will you pay for it? In another post (linked HERE) attorney James Gross discusses how people pay for their divorces. Some of the ways clients pay their attorney fees are:
- Second and third jobs
- Cash in your savings
- Borrow from pension
- Sell Assets
- Borrow from friends and family
- Credit cards
- Cut living expenses
- Line of credit
- Home equity loan
Are you willing to work two jobs, cash in all your savings, and use up all your home equity to pay the lawyers who are going to fight it out for you over your separation from someone you once loved? What is the wisdom of using all the equity in a home to fight over property division of that home? One lawyer recently told me of a client whose husband, a medical doctor, had financed his attorney’s fees by using their children’s college savings. So imagine that — he’d rather fight his wife than send his children to college! Do you think this is what he really wanted?
I suggest that if you are thinking of a divorce, don’t say to yourself, “I need a lawyer.” Make your first thought instead, “We need a mediator to help us work out the terms of our separation and divorce agreement.”
If you are considering divorce but don’t want to try mediation, please — please — tell me that you have budgeted at least $10,000 for attorney’s fees for your divorce, and that you will not spend your retirement or your children’s college savings for it? Otherwise, please consider mediation. Not only is mediation less polarizing and less traumatic. It’s far less expensive than a divorce in the adversarial court system.
For my page with a few general resources related to divorce, click HERE
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