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 money 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 negotiate 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 outcomes 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 sidetrack 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, but the Parenting Coach is also 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. The 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!
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 we offer to complete uncontested divorces for a fixed fee of $2500.00, inclusive of HST and the court filing fees (which are over $680.00).
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 a 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 a very bitter divorce shared with me his “analysis” of why divorces cost so much. He said, “They’re worth it!” I like his attitude!