Alternate Dispute Resolution
The legal methods we use
Another process used by Family Law Lawyers to reach a reasonable settlement is negotiating between the two lawyers, or if the other party does not have a lawyer, with the other party directly. When there is no lawyer on the other side lawyers typically use written communication to negotiate terms.
If all the assets are known, as a first stage in the process, I will discuss with my client what s/he thinks is a reasonable settlement of all issues, those being child support, spousal support and division of assets. A Spousal Support Advisory Guideline calculation is done which shows a range of possible spousal support amount, either monthly or a lump sum and the number of years spousal support is to be paid. The calculations also show the amount of child support that should be paid depending on the residency of the children. The calculations a very helpful in determining what a court would normally order and what parties should settle on.
Generally, the division of assets can easily be determined based on the Family Law Act (the “Act”), unless there are unusual circumstances. The Act requires, and equal division of assets accumulated during the relationship and include, real property, pensions, investments, household contents, bank accounts. Debts accumulated during the relationship are also divided equally, no matter who accumulated them, although there are provisions in the Act for an unequal division of assets if there has been dissipation of assets by one party and for other reasons.
Once a reasonable proposal has been worked out with the client, I will write the other spouse or her/his lawyer and provide a settlement proposal.
If all the assets are not known or my client is concerned there may be hidden assets, then the first step is to request documentation disclosing all the assets and obtaining appraisals and valuations. When my client and myself are satisfied we have a clear picture of the assets and debts then I will write a proposal.
There are many occasions where the first proposal is accepted outright or accepted with minor adjustments. When this happens, I can do a Separation Agreement containing the terms and the cost of the entire settlement is extremely low. There are other occasions where the parties will negotiate terms on an ongoing basis but normally at some point a court action is commenced. Despite this, negotiations continue right up until the day of trial, as it is in the parties’ and the children’s interest to settle on terms that parties can live with and they have some control over rather than having a judge decide their futures.
During negotiations it may be necessary to involve experts to advise on the value of assets or the tax consequences of the various processes for division of assets or spousal support. These experts include, land appraisers, accountants and pension valuators. Hiring these experts can be expensive however, often avoid an expensive trial. Their reports and advice help the parties know, with reasonable certainty the value of assets and the consequences of dividing assets in a particular way. For example, selling recreational property or transferring it to one spouse can trigger capital gains tax at the time of sale. The parties need to know how much the capital gain tax will be when they consider if they should sell the property or one of them should retain it.
Having a lawyer do the negotiations helps ensure that the agreed upon terms are reasonable considering the Family Law Act, the Divorce Act, the Child Support Guidelines, the Spousal Support Advisory Guidelines and the case law interpreting the legislation. A lawyer is also trained in negotiating and will negotiate dispassionately and practically, so the best possible outcome can be achieved.
A person should never negotiate a settlement when their relationship ends, on their own. At the very least a lawyer should look over the terms the parties are considering a provide legal advice on the reasonableness of the terms. I have seen too many agreements that parties enter into that either do not deal with all the issues or are unfair. Inevitably at least one party is dissatisfied with the agreement but in some cases, nothing can be done to rectify the unfairness.
Having an enforceable Separation Agreement also ensures regular support payment will be enforced and that spousal support payments are deductible on personal income taxes. If parties are unable to settle all issues between them, there are again other ways to assist parties to settle disagreements. The least intrusive is to attend mediation.
Mediation is a process where both parties meet with the mediator/lawyer and review the facts, issues and set out what their interests are. The mediator/lawyer does not give legal advice but assists the parties in focussing on what needs to be arranged for the family to move on. The mediator/lawyer will insure that all issues are covered and once an agreement is reached will do up a Separation Agreement or have the parties engage their lawyers to do up a Separation Agreement.
Family Law Lawyers are also experienced in other means of settling disputes outside the court system. Family Law Lawyers will negotiate with the other side to see if there is a possible resolution, and some Family Law Lawyers are trained Collaborative Practice Lawyers. There are many options available to keep parties out of court, however, if parties cannot resolve their issues then the last option is court. It is imperative that each party retains a lawyer to assist them through court. The system can be very confusing and frustrating. A Family Law Lawyer knows how particular issues need to be addressed, the options available and the settlement processes built into the court system that can be utilized. Going to court on your own is extremely risky, so at least talk to a Family Law Lawyer, who can help you get through to resolution, even if it is to provide guidance in the background.
Collaborative practice is a process that has been developed for people going through a separation to settle all issues of their separation.
Parties who use the collaborative process will each have their respective lawyers who provide legal advice to them and ensure all assets have been disclosed and proper values have been determined. The role of the lawyer is to work with both parties and the other lawyer to reach an amicable settlement and to provide legal advice to their client. At the commencement of the process all parties agree they will not proceed to court and if the negotiations break down the parties will have to obtain other lawyers. All parties sign an agreement to engage in the collaborative process and confirm their understanding of each participants role.
If there are complicated division of assets issues, an accountant will be engaged to be part of the process to provide tax advice and other accounting advice. Counselors for the parties may also be engaged to help the parties with the emotional issues of separation, to provide advice regarding the children and to assist in communication issues between the parties.
The focus is to provide a team approach to assisting parties through a difficult time and to arrange matters for them, so they have a healthy future as a separated family.
Carolyn Oien is the co-chair and founding member of the Kamloops Collaborative Family Law Association. Their website can be found at www.kamloopscollaborativefamilylaw.com.
For further information on Collaborative Practice please see the attached.