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Keeping an Eye on the Bottom Line

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A divorce is about a lot of things.  It’s about money.  It may be about kids.  It’s about property.  It’s always about feelings, no matter how amicable the split is.

If the split is amicable, lawyers rarely see the people.  I actually see a lot of them because I volunteer most months for what in Marin we call the “Pro Per Calendar,” where people without lawyers are scheduled to come in on the first and third Tuesday afternoons in our two family law courtrooms.  A small group of lawyers volunteer to work with people without attorneys to try to help them along to settlement and judgment.  On a good day I may help settle two cases for people who usually don’t have a lot of possessions or income and get along fairly well.

These aren’t the people who hire lawyers, for the most part.

Many people know from the start they need a lawyer because too much is at stake.  Many people try to settle things without an attorney and find that they cannot.  It is too complicated, they are too far apart in what they want, or their feelings are too strong and the distrust is too great.

One of the first things I do when meeting with a potential client is to try to find out what the assets of the marriage are, how much money the spouses make.

Being a greedy lawyer, you might suspect that I am doing this because I want to know how much I can get away charging this rube, but the real reason is that from the very beginning, and all through the case if I take it on, I have to maintain my eye on the bottom line.

Here’s an example I heard of recently from a lawyer who sat on the mediation panel that settled the case.  Woman was in a short marriage, maybe 1-2 years.  Her lawyer went all out, no expense spared in her case.  Case settled.  She got $40,000.  Her attorney fees?  They had asked for about $40,000 in settlement.

Now, I have no idea if her attorney reduced her bill given the settlement, but it shows that an attorney must, from day one, be very aware of how much is actually at stake in a divorce.

That’s why I try to get a clear picture – what assets are at stake, is it worth fighting over them, how can we best proceed if I take the case, what is my best advice for you.

The Family Code (section 2100) declares that it is a value of the Legislature to preserve the assets of the parties in a divorce, which means that as officers of the court it is the duty of the attorneys to promote this.  Clearly not all attorneys pay attention to this and judges do not enforce it literally (although they can be parsimonious with fee awards when they believe attorneys have padded bills).

Divorce can be expensive.  I’m told the self-help books say an attorney will cost between $15,000 and $20,000.  That’s wishful thinking in the San Francisco Bay Area, where attorney rates run from $300 to $500 an hour.  A single appearance for a case progress conference with the required form could cost you $1000 or more.  A simple email could cost $125.  A motion for support could cost $4000 to $6000 or much more.

If you are fighting over hundreds of thousands of dollars, these things are worth it.  If you are fighting over very little, then you are better off working together and making compromises, perhaps with a low-cost neutral mediator.

If you are mainly concerned about spousal support (what used to be called alimony), and you have a short-term marriage, use the rule of thumb that support will last about half the length of the marriage, generally starting from the judgment (not separation).  To ballpark what you might get or pay, add together what both parties earn (gross, before taxes and deductions) and divide it up so the person making less money gets about 40% and the person making more gets 60% of the total.  The person making more has to pay the person making less enough to bring them up to that 40% mark.  Only a very rough estimate, and there are online calculators that will give you more accurate numbers, but this will give some guidance.  While post judgment support is not based upon the same guideline numbers as is temporary support during the divorce by law, it is “uncanny” how these numbers often seem to apply even to post judgment support.

Thus if you were only married for four years, and you will only be getting $1500 a month in spousal support ($18,000 a year for 2 years or $36,000 total) do you really want to pay some lawyer $15,000 of that?

Better to agree to go to a mediator, each pay him or her $1000, and work out an agreement where you get that same $1500 a month.

If you have a house, where he claims his parents kicked in $100,000 down payment as a gift to him and you say that was a wedding gift to the two of you, then you have a real reason to hire an attorney.  I’ll leave the explanation of why for another post.

It’s all about the bottom line, and a good attorney will go over that the first thing with you to explain whether your case is worth a fight between attorneys or better suited to mediation or just sitting down, gritting your teeth and writing out an agreement.  It may be that you can use an attorney to prepare you for mediation, which I have done a number of times as another low-cost alternative to a long court battle.

If an attorney takes your case without getting into the details of your finances after simply asking if you have enough money to pay their retainer, beware!  They are only looking out for their bottom line!

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