Understanding the Collaborative Divorce Process, Part 2: Asset and Property Division

While the collaborative process can help co-parents improve their ability to cooperate and work together for their children’s best interests, the collaborative process also offers benefits to child-free couples and others with concerns about their asset and property division. By agreeing to use this non-adversarial divorce alternative, you can control the division of your assets to make both your futures brighter.

Collaborative Process for Asset and Property Division

Collaborative law is a low-conflict, non-adversarial option for couples and families who want to avoid traditional divorce litigation. In Part 1 of this series, this blog explains the collaborative divorce process, focusing on the steps you will take to get from dispute to divorce. The broad strokes of the collaborative process remain the same whether a couple is trying to transition from partners to coparents or simply trying to divide up their bank accounts. However, because property issues rarely require the same kind of lasting cooperation post-judgment (unless you and your spouse decide to share the family business), your focus can be on reaching the best possible outcome for you and your spouse, making the most of the assets you have and anticipating both of your future needs.

How the Collaborative Divorce Process is Different than Litigation

As discussed in the last blog post, the difference between collaborative and adversarial divorce comes down to the mindset of both parties. In traditional divorce litigation, each spouse may be trying to protect what is “theirs” and “win” a bigger share of the marital estate. But in a collaborative divorce, both spouses commit to a mutually beneficial outcome right from the start. This improves transparency, reduces expert fees, and provides a more holistic outcome that takes both spouses’ practical needs into account.

The Role of the Financial Neutral

A collaborative divorce can involve a financial neutral like a Certified Divorce Financial Analyst (CDFA), accountant, or a tax professional. This expert’s job is to help both spouses have a clear picture of bothparties’ assets and liabilities, so that there are no surprises as you negotiate a fair and equitable division of those assets. A CDFA can work with each party to consider what life post-judgment will look like, financially speaking, what you can afford, and how you will make ends meet.

There is no equivalent in divorce litigation, except, possibly, competing expert witnesses, which can double the expense (or more). All too often one or both parties will negotiate a property settlement or advocate for an asset and property division at trial only to find out that they owe taxes, or are going to have to pay penalties just to access the funds they fought to receive. Without the collaborative process’s commitment to transparency, parties may also find their spouses concealing assets, resulting in substantial attorney fees and discovery costs just to uncover them. While the collaborative process is not necessarily less expensive than traditional litigation, the costs are often put to more effective use than fighting over paperwork.

Mutual Valuation Experts

Your financial neutral can help identify assets that must be traced, business interests to be quantified, and property to be appraised to establish its value. Then your collaborative divorce attorneys and divorce coach can retain experts like appraisers, real estate agents, business valuation experts, or collectible vendors to help you establish how much those different assets are worth.

In litigation, each party often retains his or her own professional, getting separate reports with small differences in methodology or valuation. This sets up a “battle of the experts” at trial, with the parties paying their attorneys and their expert witnesses for the time it takes to argue over how the number was calculated. In a collaborative divorce setting, the parties agree to hire mutual experts. Differences and misunderstandings that lead to lengthy litigation instead are topics for discussion as both spouses try to get the most accurate figure. Because of this, expert fees are often lower under the collaborative model.

Advantages to Collaborative Divorce for Property Division

While the collaborative divorce process isn’t right for every couple, if you and your spouse are both committed to a low-conflict resolution of your marriage, it can have distinct advantages over traditional litigation.

Anticipating Tax Consequences and Penalties

One of the shortfalls of traditional litigation is that it is often focused on the past, and what each spouse did to cause the breakdown of the marriage, rather than the future. Because of this, a divorce judgment can sometimes be entered that places significant unexpected tax burdens and penalties on one or both spouses. Working with a CDFA, your collaborative divorce attorneys can help you and your spouse look ahead to anticipate these roadblocks, so you know the resolution you agree to will be practical and effective in the future.

Dividing Portions, Not Splitting the Balance

While Connecticut family court judges have wide latitude to enter asset and property division orders based on what is fair and equitable, it often comes down to numbers. A judge could order the parties to sell a home they both want to keep, or might order each party to pay their own debts without fully understanding how the balances and monthly payments will affect spousal support. Using a collaborative approach allows you and your spouse to tailor-make a property division that puts your priorities first, rather than focusing on nickels and dimes.

Providing for Your Family’s Individual Needs

Every family is unique, but some families have more specific needs than others and that can affect their property division. For example, if you or your spouse is disabled, you may need to craft your property settlement and support agreements to avoid threatening access to government benefits. If you and your spouse are older, you may need to closely consider how pensions and retirement assets will be divided, since you won’t have as long as other couples to rebuild your nest egg. Collaborative divorce can help you and your spouse adjust your property division to suit your family’s needs, and improve both of your futures.

Reducing the Risk of Post-Judgment Litigation

The collaborative divorce process starts with both parties agreeing to cooperate. That commitment often carries on even after the Judgment of Divorce is entered. While litigants may have to file motions to enforce their judgment after trial, forcing parties to sign over deeds or release assets, couples who have negotiated a collaborative divorce are more likely to follow through on their promises. That means you are far less likely to have to resort to going back to court to get what the Court has ordered you to receive.

Get Help with Collaborative Divorce in Connecticut

The family law attorneys at Lawrence & Jurkiewicz can help you identify if collaborative divorce is right for you. We represent clients in Hartford and Litchfield County, offering a variety of traditional divorce litigation, mediation, and collaborative law options. To schedule a confidential consultation to see how we can help you, please contact us today online or at 860-935-6284.