You think your spouse is hiding assets and you want to hire a pit bull attorney. Here’s 4 reasons why mediation is still better.
1. You are the Primary Source of Financial Information.
What is the difference between litigation and mediation in locating assets? Not much. That’s because you are the primary source of information. The attorney will rely on your knowledge of your finances, including what's on the computer, the filing cabinet at home, bank statements, envelopes with addresses of financial institutions that you have received in the mail, and even the trash. All those things have been found in both the mediation and litigation processes.
You need some knowledge because there are $6,800 FDIC insured banks in this country and almost as many credit unions. No one can send out thousands of financial releases or subpoenas. Most people keep their extra account, if they have one, in the same bank as the joint checking account.
2. Mediation Doesn’t Escalate and is Just as Effective.
In litigation, once you have some basic information about where additional money might be located, your attorney can take formal “discovery” including depositions of your spouse under oath, written formal questions called “interrogatories” or even subpoena that information from a third party. Unfortunately, this creates enormous conflict. Whether your spouse resists or immediately provides information, they still feel humiliated and angry. Even experienced attorneys can be drawn into the conflict as each side digs in further. The attorneys become two jousting knights with one being the “white knight” pursuing information and the other the “champion” defending the unfairly accused spouse. The jousting takes more time and money.
In mediation, we recognize that people may not be completely forthcoming. However, everyone wants to be seen as cooperative. Almost everyone we've asked to sign a release of financial information has done just that agreed because we requested it without being judgmental, even if assets were not initially disclosed. When gaps do appear, an experienced mediator can ask clarifying questions about financial documents such as tax returns which allows for incremental disclosure without shaming either spouse. (However, if someone refuses to sign a release of information, mediation must terminate because it is premised upon full disclosure of information.)
3. Your Spouse Might Not be Hiding Anything
Sometimes people defensively make financial mistakes because they are concerned about the other persons future behavior. This includes draining savings and checking accounts “to protect” themselves. This defensive, first-strike behavior is not only infuriating, it also generates suspicion and misgivings about the quality and quantity of the financial information provided, even when it is accurate.
4. You Still Have an Enforceable Judgment
It is naïve to think that everyone who has ever been divorced has fully disclosed their finances. A financially sophisticated spouse could have funneled money to an offshore confidential account, or, like Walter White, a storage unit filled with millions in cash. Luckily, most people do not. In fact, those who try leave many clues behind (tax returns, pay stubs, and bank statements with deposits of income, etc.)
Whether you spend years in litigation or settle it over several months, you end up with an enforceable judgment. Sometimes, the failure to disclose is not discovered until after the divorce. The law allows a spouse to reopen that divorce judgment based upon the intentional misrepresention of important financial information.
Because 98% of all cases settle, the question is not whether there is an agreement but when. Both processes reveal financial information of the spouses. But one process takes far less time, money and is not as emotionally draining as the other.