I think one reason why people almost automatically head to court during separation is that they lack confidence about whether the dispute can be resolved by any other method. They don’t know what the options are, and expect a conflict, so they want to “get started.” Having a case up and running reminds them that the relationship has ended and that they are doing something about it.
Some folks even believe that there is a tactical advantage to being the first litigant. They believe that being a defendant is a disadvantage. That’s untrue, of course, but I wonder how many lawsuits have been started with that thought in mind.
Many litigants get into the courts because they assume that their spouse is foolishly stubborn, won’t settle, can’t understand logic, and won’t listen to his or her lawyer or mediator. That kind of thinking may cost thousands of dollars and a great deal of anguish.
Having said all that, there exist numerous examples of cases where the absolute fear of lawyers and litigation has proven disastrous. There are circumstances where legal advice is worth its weight in gold. You just have to know when, where, and how to use a lawyer.
Several years ago, I had a man come to see me for a free initial interview. He told me his entire story, and I gave him some advice and ideas about various options. He was grateful for the information and left.
About a month later he called again. He wanted another appointment, so I agreed to meet a second time. We talked further, and I answered a series of specific questions. At the end, I told him that he must get proper legal advice before signing anything, and I warned him about the risks of homemade agreements. I did not believe he was being suitably cautious, and I was worried about his rush to resolution. He seemed absolutely focused on getting a deal even if it was a bad deal. Troubling, too, was the fact that he wanted a great deal of free advice about tricky concepts, and he wanted to pay nothing for it. This reminded me of the adage about being penny wise and pound foolish. I made a note of this, and told him that there would be a fee for the next meeting.
I didn’t hear from him until a year later. At that point, he wanted another free consultation, this time about the divorce. I apparently forgot that he had already milked me for tons of free advice, and so I agreed to a short third and final meeting.
He made the appointment and showed up for the last bit of free information. We exchanged pleasantries, and I asked him if he had resolved matters with his wife. He said he had, and proudly announced that he’d done everything himself. I congratulated him, but reminded him that I had told him on both prior meetings that he must see a lawyer before signing anything. He said yes, he remembered that, but was confident he hadn’t needed counsel and said he really didn’t want to spend money on lawyers. He had heard what I told him, but insisted that he knew what he was doing. He then proceeded to tell me that in resolving matters with his spouse, they had agreed to share the registered mutual fund portfolio.
In Canada, where I live and work, separating spouses can divide a registered savings portfolio (which is a tax deductible savings instrument) without incurring any income tax. To obtain this benefit and insulate themselves from tax, however, the deal must be contained in a written separation agreement and accompanied by a form (T2220 E). If that’s not done, the transaction triggers tax, payable immediately.
The man didn’t know that. He hadn’t asked me about it, didn’t tell me he planned to do it, didn’t ask anyone else, and didn’t think it was important to find out. More importantly, he didn’t see counsel before signing the agreement. Not knowing about the tax benefits of the law, he cashed out his fund and divided the spoils.
At the time, the husband and wife had about $200,000 in this registered savings portfolio. When the fund was cashed in, the liability for tax was triggered, and the government scooped about $60,000. The husband and wife then shared the remains (about $70,000 each) and went their merry ways.
By saving the $500 I would have charged him, the man and his separating wife needlessly gave away about $60,000 to the tax department. Had either of them sought basic legal advice, the fund could have been divided in specie, meaning there would have been no tax payable. Nothing!
For this man, the desire to save a few hundred dollars in legal fees cost, quite literally, $60,000. That’s an example of a case where a little advice goes a long way.
However, many people regularly overpay lawyers for work and services that are either not necessary or not helpful. In saying that, I’m not suggesting that lawyers are dishonest with clients about work that needs to be done. Very often in my own practice I will recommend clients against taking a particular course of action, only to have them insist that I do their bidding. Although I don’t enjoy working with clients who won’t take my advice, at the end of the day I have to remember that the client calls the shots. As long as the instructions do not involve something improper or unlawful, it’s not really my place to demand that all clients do exactly as I command. That’s not really how the relationship works.
Still, from time to time, I have to put my foot down. At this point in my career, I actually do that with greater frequency, sometimes based on principle. For instance, I rarely engage in custody litigation except in special circumstances because I have a personal belief that the process is simply too destructive. The exceptions would include cases of genuine alienation, violence and abuse, and real danger. I don’t accept retainers for cases where the parents are simply fighting over the kids on the basis that one parent is “better” than the other.
I’m also not interested in acting for clients who lie to me, won’t pay child support, or expect me, as their lawyer, to prove a fact which is unimportant in law, such as adultery. However, that’s just me.
What I see, with some frequency, are clients who have wasted money on lawyers. These would include spouses who have deposited a big retainer with a lawyer, and then instructed the lawyer to “process the divorce.” Sometimes, equally vague and ridiculous instructions such as “do your best.”
I know this happens because I often encounter counsel on the other side of a case who is unaware of exactly what their client wants. As I write this paragraph right now, I am handling a case that is set for trial in three months. We have had several days of discoveries (what most Americans would call depositions) and a few pretrial motions. The case has been going on for about a year. During that time, I have written to opposing counsel three times asking for a response to our offer, a counterproposal, or anything resembling a reply, but I have heard nothing. It is all quite exasperating.
I know that the other party has already paid a little more than $15,000 in legal fees so far, and is probably about to spend a similar amount over the next few months. I suspect the amount that we’re arguing about (the “quantum” in issue, and the amount which separates our clients) is $40,000 to $80,000. It may be that if I could encourage the opposing party to simply respond with an offer or counteroffer, I could encourage my client to settle, but I can’t. I cannot negotiate with myself.
Worse still, I know that the other side will soon be forced to describe the demand, because at the start of the trial, the judge is going to ask.
In this case, I suspect that opposing counsel is well retained and simply allowing her client to call the shots. The client doesn’t know exactly what she wants, because she (like Mrs. G, in the example in Chapter 1) is really pursuing something other than a solution — she wants blood, or justice, or some other ill-defined objective. Sadly, none of those can be achieved through litigation.
What should really be happening is this: The opposing lawyer should sit down with the client and have a heart-to-heart and say something like this:
We’re now at a point in this lawsuit where we know enough about the facts to respond to the offer that’s on the table. We should do that. I have done everything I can for you. You and I know that there’s a range of possible outcomes here. If I do a brilliant job, I can obtain for you a resolution that is beneficial to you and within that range.