The decision to terminate a marriage is always a difficult one. That decision is then followed by a divorce proceeding, which in itself can be both painful and expensive, to say the least. The events of each marriage are unique, and no two divorces are the same. If both parties desire an end to a marriage where no children are in the picture and there is little in the way of assets, the process may be simpler and relatively fast. Unfortunately, that is seldom the case. When children are part of the marriage, issues regarding child custody and support payments must be addressed and resolved. Divorce cases can also become difficult, and potentially combative in nature, when the separation involves high net-worth individuals. Let’s review some of the factors that come into play in high net-worth divorce proceedings.
What to Expect in a High-Net Worth Divorce
Divorce proceedings that involve high net worth individuals are usually more complicated than traditional divorce law cases. This is due to diverse and valuable assets that may be spread around the world. High net-worth marriages can include numerous assets and associated liabilities. The current value of some assets, such as current balances of checking accounts or the current value of stocks, can often be easily determined. Many of the assets that are involved in these cases, however, can be difficult to value. This can include equity in private companies and various types of trusts.
In addition to having to determine the value of a vast pool of resources, individuals involved in these cases are naturally determined to get what they see as their due from the settlement. This, in turn, can lead to contentious negotiations. The process of locating and placing the proper value on all assets can be time-consuming and require the patience of all parties involved to achieve an equitable distribution of assets. Sometimes, one of the parties may try to hide their assets by not revealing the existence of a bank or brokerage account. Maybe the account has been set up out of the country, perhaps in Switzerland or the Cayman Islands.
Occasionally, the dishonest spouse tries to hide assets by transferring them to a close friend or a relative. This is a very risky game for the spouse to be playing. The thorough level of asset checks done in high net-worth divorce cases usually uncovers the hidden assets. Further, when the fraud is discovered, the offending party will lose credibility in the eyes of the court, which could affect the court’s decisions on other issues.
Understanding Family Law
High net-worth divorce cases will often involve more than just two high-income people who want to retain as much ownership of the assets as possible before going their separate ways. The marriage may include children, introducing issues regarding child custody and child support. The issue of spousal support (alimony) in family law is also a consideration. Where and how these various issues will be decided is up to the parties of the marriage. If the parties’ decision is to go with the traditional courtroom approach, each party will retain the services of a divorce attorney who works for them alone and advocates on their behalf. The lawyers will meet and negotiate the issues on behalf of their respective clients.
The divorce attorneys discuss the issues before going to court to resolve the differences. The lawyers argue the merits of their side in the courtroom. Both sides can call witnesses on their behalf. Even the children could be called by one side to testify in open court. Ultimately, the judge makes the decision on all issues related to child custody, child support, alimony, and division of assets. In short, the traditional divorce process can be both time-consuming and expensive. In the past, that courtroom approach was the only way to seek a divorce. Today there is an alternative, known as divorce mediation.
Using Divorce Mediation for Large Assets
When the parties seeking a divorce choose mediation, they retain the services of a trained divorce mediation lawyer who works with both parties throughout the entire process. Utilizing this method, the parties only retain the services of one lawyer, greatly reducing the costs. Further, by working with a single attorney, both parties have greater control over the entire process, from start to finish. This is one of the most significant benefits of working with an experienced divorce mediation lawyer who wants to assist both parties in reaching a mutually agreed upon settlement. If you are facing a divorce in your future, consider talking to one of the divorce mediation lawyer experts at Shapiro Mediation today.
As previously noted, high net-worth divorce cases present issues beyond what is found in the average divorce law proceeding. Statutory guidelines that states have in place to help determine proper child support payments and spousal support are often not realistic when dealing with wealthy individuals in a high net-worth divorce. Special considerations in determining an amount for child support may include costs associated with private school tuition, a nanny to care for a younger child, or the costs of an expensive hobby or activity the child participates in on a regular basis.
Looking towards the future, keep in mind that court-ordered child support payments can only be legally ordered until a child becomes an adult at age 18. To ensure the child’s future educational needs are met, high net-worth divorce settlements often address the future college tuition expenses of the children. This can take the form of specifying which parent is responsible for paying such costs in the future or setting aside money for these expenses at the time of the divorce. While monetary issues related to children may be complex, the most complex issues when working out a high net-worth divorce settlement usually revolve around valuing the diverse assets owned by the parties.
While typical couples may have a home, a couple of cars, retirement accounts, and perhaps a few shares of stock, wealthy divorce cases can include diverse real estate holdings, private business interest, and a plethora of valuable possessions ranging from jewelry and fine art to yachts and airplanes. Putting a proper value on such assets can require many experts and much expense going through appraisals.
Shapiro Mediation is Here to Help
Divorce is a stressful and overwhelming event. Utilizing a divorce lawyer is as far as many people go. Mediation, however, can lead to a quicker resolution of the issues as the divorce mediator works to assist both parties in reaching an agreement that is acceptable. Mediation involves the active participation of both parties throughout the process. The mediation process is also confidential, usually taking place in a private conference room. The parties to the dispute and the impartial mediator are the only ones present.