CLIENT TO HERSELF: “Why is my lawyer making me prepare financial disclosure when all I need is a separation agreement?”
CLIENT TO LAWYER: “I know what my husband has and he knows what I have. We’ve agreed on how we’re dividing the assets. Just draft it up so we have a legal separation agreement!”
These are comments often made by clients who have retained lawyers to assist them in negotiating a Separation Agreement. Reasons include:
I (the client) don’t have the time or patience to do this work;
I don’t want to pay for my lawyer’s time in doing this;
This is just a make-work project by the lawyers (after all that’s why they’re all rich, isn’t it!); and
I trust my spouse!
So why is financial disclosure in negotiating separation agreements (and marriage contracts also!), necessary?
For the answers and my full article please click here. If you have any trouble connecting to the complete article, please email me and I will send it to you – anne@annefreed.com
Until next time!
Anne!
Anne Freed holds a BA (Honours Sociology), JD (Juris Doctor, Law Degree), Master of Laws Degree (LL.M.) in Alternative Dispute Resolution, Advanced Training in Mediation, Arbitration and Collaborative Practice, Certification in Collaborative Practice, and is a Certified Specialist in Mediation (FDRP Med)
Happy almost Spring-Time! For today’s topic, I will discuss how to have a Confidential Divorce.
In this regard, it is important that you know that, when one’s matrimonial matter goes to Court, the Court materials including Pleadings, Affidavits and – most importantly – the parties’ Financial Statements and Financial Documents will be in the Court file, and will be available to any members of the public for viewing.
Let’s return to Harry and Sally’s situation. Between them, they possess considerable financial assets, and also debts. Also, they have a complicated financial picture.
There are many processes available to Harry and Sally to negotiate their Separation Agreement and Divorce. It is of utmost importance to each that their financial records remain confidential. There are several processes that offer such Confidentiality. They include the following:
Mediation, and
Mediation/Arbitration (also called/Med/Arb).
We will assume that Harry and Sally have retained lawyers. Harry and Sally have heard from friends about these processes and are interested in utilizing them. They speak to their lawyers and their lawyers are on side. In fact, Judges at the Courts also actively encourage Mediation to be held, outside of the Court – even to happen alongside of the Court process – to try to settle all or some of the issues in the Court matter.
Harry and Sally decide with their lawyers to try a Mediation/Arbitration Process. This is a 2-stage process where the parties engage in private Mediation with their lawyers present, with a Mediator who – as the issues are financial and legal – is a lawyer. If Harry and Sally cannot resolve their issues in the Mediation, then the Mediation process will end and will be replaced by an Arbitration Hearing.
In this, the Mediator will take off her Mediator hat and put on a new hat: her Arbitration hat. The Arbitration will proceed as a Hearing – much like a Court Hearing, with witnesses and in accordance with the Rules of Evidence just like in a Court Process. At the end of the Hearing, the Arbitrator will make the Decisions, and these Decisions will be binding on Harry and Sally just as Court Orders would be.
It is important to note that, in both these processes – Mediation and Med/Arb – Financial Information and Documentation in detail must be produced, in order to have a binding Agreement between Harry and Sally, and not have to look over their shoulders in the future. Harry and Sally must lay all of their financial assets and documents on the Table. Full Financial Disclosure is a fundamental prerequisite to have a lasting and binding Settlement, as Harry and Sally each need to have all the financial information about the other on the table in order to be able to make informed decisions (see my blog on “Financial Disclosure”).
In Mediation, and in Mediation/Arbitration, Harry’s and Sally’s Financial Information will remain Confidential to the parties, their lawyers, and the Mediator.
It has been found that the “threat” of an Arbitration Process – where third parties not Harry and Sally shall make the decisions regarding their lives, often has the effect of the parties settling in the Mediation stage!
Where parties divorcing have high net worths and financial information that they do not want to be available to the public, Confidentiality considerations are especially important.
The one caveat in a Mediation/Arbitration Process is that – if Harry or Sally wishes to appeal the Decision of the Arbitration –the appeal must go before the Court. Once at Court, all the parties’ financial records will be available to the public.
In a Mediation only Process, the Confidentiality will remain.
For further information on these processes, see my blogs as follows:
My practice focus, as a lawyer and mediator with over 35 years experience and expertise, is on acting as a Mediator in a Mediation Process, or as a Mediator/Arbitrator in a Mediation/Arbitration Process. If you are interested in discussing the possibility of retaining my services in either of these processes, feel free to contact me at anne@annefreed.com.
Until next time!
Anne
Anne Freed holds a BA (Honours Sociology), JD (Juris Doctor, Law Degree), Master of Laws Degree (LL.M.) in Alternative Dispute Resolution (ADR), Advanced Training in Mediation, Arbitration and Collaborative Practice, Certification in Collaborative Practice, as well as over 35 years’ experience in the practice of Family Law, Family Mediation and Arbitration. Anne also is a Certified Family Law Mediator. In addition, Anne is a Certified Specialist in Family Mediation (FDRP Med).
What, you may ask, does one have to do with the other? Here is the answer. Debbie and Don are engaged and planning their wedding. They plan to live in a condo in Leslieville which Debbie had purchased 10 years earlier. She had worked and saved up every penny to buy the condo and is pleased that – at age 35 – she is a condo owner. Debbie and Don – both 35 – know that, given the high divorce rate, they should have a Marriage Contract (termed a “Prenup” in the U.S.!).
Their respective lawyers explain to them that, if they should separate down the line and are living in the condo when they separate, even though the condo is in Debbie’s name, it is called the “matrimonial home.” Their lawyers explain that the law is that the matrimonial home equity is to be shared 50/50 between Debbie and Don in the event of a separation.
Debbie and Don both feel that, in such event, it would be fair that Debbie should be able to keep her investment in the condo i.e., the funds that she put into the matrimonial home. This can include the funds that she put into the matrimonial home up to the date of marriage, and/or other parameters.
The way to ensure this is to have a term in the Marriage Contract that Debbie keeps her investment in the condo up to the date of marriage.
There are other important terms that Debbie and Don can have in their Marriage Contract. Mediation is one of several processes available to the couple to negotiate their Marriage Contract. In Mediation, the Mediator must take into account the sensitivity of parties in negotiating their Marriage Contract.
If Debbie and Don’s situation rings a bell with yours, please feel free to contact me to enquire about my Mediation Services.
Until next time!
Anne
Anne Freed holds a BA (Honours Sociology), JD (Juris Doctor, Law Degree), Master of Laws Degree (LL.M.) in Alternative Dispute Resolution (ADR), Certified Specialist in Mediation (FDRP Med), Certification in Collaborative Practice, Advanced Training in Mediation, Arbitration and Collaborative Practice, as well as over 35 years’ experience in the practice of Family law, Mediation and Arbitration.
Welcome to my fall newsletter! I hope you are enjoying our beautiful fall weather. Today I shall discuss the different hats that must be worn by the Mediator in the Mediation/Arbitration process.
Continuing from that, I shall discuss with you today the different hats that the Lawyer – who has been retained by the parties to be their Mediator – must wear, at the beginning of the Mediation process, and then change to a different hat as the process changes to an Arbitration.
I’ll use our old friends Harry and Sally as the parties here. I encourage you to read my earlier blog as Part 1 of my discussions about the Mediation/Arbitration (Med/Arb) process. This is now Part 2.
The first stage of the Mediation/Arbitration process is the Mediation stage.
In this regard, Harry and Sally meet with Mickey Haller (whom some of you may know as the ‘Lincoln Lawyer’!). They decide to retain Mickey as their Mediator to help them resolve the issues in their marital breakdown.
Once retained, Mickey must take off his Lawyer’s hat and replace it with a Mediator hat, in order to effectively mediate for the parties.
Note: Sally and Harry each have decided to retain a lawyer to represent them. In that regard, Sally with her lawyer and Harry with his lawyer will appear before the Mediator/Arbitrator.
In Mediation, Mickey works with the parties and their lawyers with the objective of the parties reaching Agreement on all their issues. As their Mediator he will consider – in addition to the law – the interests, wants and needs of Harry and Sally and their children.
It is important to note that Mediation is very different from the Court process, where the Judge must consider only the law and the proven evidence. Similarly, in the Arbitration process, the Arbitrator must consider only the law and the proven evidence.
In our case, Harry and Sally are unable to reach Agreement on their issues. Therefore, Mickey terminates the Mediation Process, and the process transitions to an Arbitration Process.
Now, Mickey must – again – change hats. This time he must put on the hat of an Arbitrator.
In the Arbitration Process, Mickey must strictly follow the Rules of Evidence – including the Rules against Hearsay – and consider only the proven facts of the case. He must disregard any comments that have been previously made by the parties or their lawyers in the Mediation phase, as many of these discussions were opinions or hearsay, and not evidence in accordance with the Rules of Evidence.
The Arbitration Hearing is much like a Court Hearing, and must follow a set of prescribed Rules, except that the parties have much more of a say in the timetable of the Arbitration Hearing.
During the Mediation, our Mediator Mickey often took the liberty of expressing opinions as to how Sally’s and Harry’s case might go. However, in the Arbitration, Mickey must disregard all opinions, hearsay and unproven evidence that he heard or gave during the Mediation phase. He must consider only the proven facts and the evidence.
Mickey may, as a result, come to a completely different decision than he might have ‘expressed’ or implied during the Mediation Phase.
In order to be effective in the Mediation/Arbitration Process, Mickey must maintain the highest standards of ethics. He must remain neutral in both processes. He must be able to separate what he heard in the Mediation phase, from what he will now hear in the Arbitration Hearing.
It is important for the Reader to note that, and the end of the Arbitration Hearing, the Arbitrator – Mickey – will make is an Order that is binding and final on Harry and Sally, just as in a Court Order.
Therefore, it is incumbent upon the parties and their lawyers to interview, consider carefully and ultimately choose the “right” Mediator/Arbitrator for their matter. This person understands the challenges that this hybrid process poses, and is acutely aware of the three changes in hats required, in order to ensure that the Med/Arb Process is effective, fair and satisfactory to both parties.
In my Master’s of Law studies in Alternative Dispute Resolution (ADR) – which I engaged in as ‘post-graduate work’ subsequent to my Law Degree – I had the opportunity and time and indeed it was my goal, to reflect on the serious ethical issues that a hybrid process such as Mediation/Arbitration presents.
The Mediation Process is fundamentally different from the Arbitration Process and the Mediator/Arbitrator must ensure that he/she wears a separate hat for each of these processes.
As a senior Family Law lawyer, and with my education and experience in ADR processes – of which Med/Arb is one – my practice focus is on acting as a Mediator in Mediation matters, and as a Mediator/Arbitrator in Mediation/Arbitration matters.
In my Med/Arb practice, I bring my many years of expertise in Family Law, plus my understanding garnered through my intensive ADR studies, to the table.
Feel free to schedule a meeting with me if you wish to explore the possibility of utilizing this process in your matter.
Until next time!
Anne
Anne Freed holds a BA (Honours Sociology), JD (Juris Doctor, Law Degree), Master of Laws Degree (LL.M.) in Alternative Dispute Resolution (ADR), Advanced Training in Mediation, Arbitration and Collaborative Practice, Certification in Collaborative Practice, as well as over 35 years’ experience in the practice of Family Law, Family Mediation and Arbitration. Anne also is a Certified Family Law Mediator. In addition, Anne is a Certified Specialist in Family Mediation (FDRP Med).
Welcome to Spring! In today’s blog I discuss a new and innovative process for people to resolve their issues when their marriage, or common law relationship breaks down.
This process is called “Mediation/Arbitration” (“Med/Arb“).
I shall use, as my couple, Harry and Sally. (For those who remember the wonderful movie, perhaps they could have tried Med/Arb in the conflict stages of their relationship to resolve their issues!)
This is a hybrid process which has two stages:
Stage 1: Mediation:
In this Mediation phase, if Harry and Sally are able to reach agreement on their issues, then a Separation Agreement will be prepared. However, if Harry and Sally aren’t able to reach agreement, then the Mediation will end and an Arbitration will begin. The mediator will take off her “mediator hat” and put on a new hat – her “arbitrator hat.”
Stage 2: Arbitration:
Arbitration is a formal hearing with strict rules of procedure similar to Court proceedings. Sally and Harry will each give evidence and there may be other witnesses. The arbitrator, having heard the evidence and then submissions of the parties’ lawyers, will make a formal Order at the conclusion of the hearing. This Arbitration Order is enforceable, just as Court Orders are.
A fundamental difference between Court and Arbitration is that, in court proceedings, the timetable of the parties’ matter is in the control of the courts and not in the parties’ or their lawyers’ control. In contrast, in arbitration, the parties, their lawyers and the arbitrator choose a timetable that works for them.
There are many other processes available for Harry and Sally to negotiate a Separation Agreement. These processes include mediation-only, collaborative divorce and traditional negotiation.
Having had 35 plus years’ experience as a Family Law Lawyer and Mediator, and with extensive training in these various processes, I utilize Mediation/Arbitration as one of several processes my firm offers for resolving one’s Divorce/Cohabitation breakdown.
It’s important to note that, in the Med/Arb process, there are potential red flags that Harry, Sally and their lawyers must consider when choosing their mediator/arbitrator. Their mediator/arbitrator should have – in addition to her/his expertise in Family Law, Mediation and Arbitration – training and experience in the ethical issues of this process, as follows:
The mediator will have heard many off-the-record statements from both Harry and Sally during the Mediation phase. It is incumbent on the mediator, if the Mediation ‘fails’ and Arbitration proceeds – to be able to ‘park’ her recollections of the parties’ statements, and to clear her mind of all of these statements, so as to be neutral in the Arbitration proceeding. As such, in Med/Arb, the mediator must take off her mediator ‘hat’ and replace it with her arbitrator ‘hat.’
I had the benefit of doing a Master’s in Alternative Dispute Resolution (ADR), years after I had achieved my Law Degree. In my Master’s studies I had the opportunity and time to reflect on these serious ethical issues.
When parties are choosing who their mediator/arbitrator will be, it is important that they inquire into the mediator/arbitrator’s professional experience and training in this specialized area.
The Med/Arb process combines peaceful resolution – Mediation – plus, when needed, the ‘strong arm of the law’ – Arbitration. The result will be that – no matter what – the parties will obtain a final settlement of all issues at the conclusion of the process.
The very fact that Harry and Sally know that, if they can’t reach agreement in the Mediation phase, their process will ‘morph’ into an Arbitration process, will provide a strong impetus for them to settle their matter in the Mediation phase. This is because they know that, once the process changes to an Arbitration, the decisions about their lives will no longer be in their hands but rather in the hands of a third party, and they will no longer have control of some of the most important decisions in their lives.
The mediator/arbitrator should – in my view – be a senior family law lawyer who is highly ethical and has the ability, training and experience to conduct a principled Mediation/Arbitration. It is required that she not only knows the law applicable to the issues, but also and most importantly in the Mediation phase, she must be attuned to the needs, interests and wants of Harry and Sally.*
It is incumbent in the Mediation phase that the mediator ensures that Harry and Sally do not feel under pressure to settle any issues. The mediator must ensure that the parties are ‘relaxed’ in this phase, so that they feel free to express their wants and needs openly, and so that they do not feel ‘forced’ to agree on terms. The mediator must also ensure that there is no power imbalance between the parties or if there is, their lawyers should ‘equalize’ the power by their representation. In this regard, the mediator will “pre-screen” the parties for such issues.
Once Arbitration begins, the ‘tone’ will be entirely different. It will not be relaxed, but rather will be a formal Court-like proceeding where, at to conclusion, the arbitrator will make an Order regarding the parties’ issues. In this phase, the arbitrator must concern herself with the law and the evidence, rather than the wants, needs or interests of the parties.
These contrasting methodologies are the essential contradiction between these two processes. It is the mediator’s challenge to ensure that these two contradictory processes ‘blend’ ethically and seamlessly into one hybrid model.
Divorcing parties are using the Med/Arb process more and more to resolving their matrimonial matters. This is because, at the end of the day, there will be a final Order. As such there will be closure for the parties.
In our scenario, let’s say Harry and Sally don’t agree on the terms of a Separation Agreement. If their process is a Mediation-Only process, the parties will walk away from the Mediation with their issues unresolved.
In contrast, because Harry and Sally are using a Med/Arb process, there will be finality at the end of the day.
A wonderful benefit of using this hybrid process is that the Harry and Sally will have closure at the end of it, and they can now move on to the rest of their lives.
Also, it’s important to point out that, let’s say our protagonists agree on 90% of their issues in the Mediation phase, they will only need to litigate the remaining 10% in the Arbitration phase.
Of course, in the movie version, Harry and Sally finally reconcile on New Year’s Eve in New York and live happily ever after. Such is not our scenario today. However we hope that, having chosen to use the Mediation/Arbitration process for their divorce, Harry and Sally will reach agreement on their issues in the mediation phase, and if not, then their matter will be resolved by an Order made in the Arbitration phase. As such, they can close this chapter and move on to the rest of their lives.
I’ve written this blog for both lawyers and non-lawyers. In Med/Arb, most often, the parties will have legal representation in the room.
Please feel free to contact me, or have your lawyers contact me, at anne@annefreed.com if you are interested in exploring the possibility of using Mediation/Arbitration as a process for your Divorce.
Anne holds a BA (Honours Sociology), JD (Juris Doctor, Law Degree), Master of Laws Degree (LL.M.) in Alternative Dispute Resolution (ADR), Advanced Training in Mediation, Arbitration and Collaborative Practice, and Certification in Collaborative Practice, as well as over 35 years’ experience in the practice of Family Law and Mediation.
Anne Freed holds a BA (Honours Sociology), JD (Juris Doctor, Law Degree), Master of Laws Degree (LL.M.) in Alternative Dispute Resolution, Advanced Training in Mediation, Arbitration and Collaborative Practice, Certification in Collaborative Practice
