Radio Show Have a listen to Stan Prowse - The Expense of Divorce Segment

Why is divorce so expensive?       And why does it take so long? 

The real costs of divorce Why are divorce costs so expensive? There are many reasons.  Let's look first at dividing the assets .  Most middle class couples have more than one checking account, savings account, and money market account.  Let's take them and cut them in half.  First we have to know the date of separation, because we're going cut them in half as they existed on the date of separation .  Perhaps the date of separation is not an issue, but we still need to have statements for all the accounts for the month in which separation occurred.  If you do online banking, it's usually quick and easy to accomplish that.  However, we're also going to need copies of all the monthly statements for all the accounts for all the months from the month in which separation occurred down to the present.  That can be a surprisingly large number of statements but. 

Community Debt, Separate Property And Reimbursement Claims

Why do we need all those statements?  The answer is that some amount of debt existing at separation is almost always paid after separation with money earned by one of the parties after separation.  The debt is community debt , while the earnings are separate property.  A party who makes a payment on a community debt with his or her separate property is entitled to be reimbursed.  In other words, the other party owes the paying party one half of the payment.  Unless you're prepared to forego what may be substantial reimbursements, someone has to examine all those statements, and perhaps all the checks drawn on the accounts, to identify and prove all your reimbursement claims. This volume of examination will greatly increase your divorce costs. 

On the other side of the coin, when community funds are used to acquire or improve one party's separate property, that party must repay the money to the community.  In other words, the party owning the separate property has to pay the other party half of the money spent during the marriage on the separate property.  These reimbursement claims can be based on payments made years ago.  That means acquiring and examining even more account statements, unless you're willing to kiss the claims goodbye.  Most people aren't, so finding and asserting reimbursement claims of both kinds requires hours and hours of work.

But, you ask, why can't we just divide the accounts immediately based on the statements for the months in which separation occurred?  Sounds like a good idea, but one party may blow the money immediately, only to discover eventually that he or she owes the other party substantial reimbursements or a substantial equalizing payment.  If the money were still in the accounts, it would be available to pay to the other party, but it's not, leaving the other party high and dry. 

ATRO's "Automatic Restraining Orders" and Division of Community Property

Each side usually refuses to take that risk, so the accounts remain undivided until the final reslution of the case.  The Family Code  attempts to minimize the risk by prohibiting either party while the case is pending from using both community and separate property for any purpose other than reasonable living expenses without the agreement of the other party or a court order.  This prohibition is one of the automatic restraining orders ("ATRO's") which become effective immediately at the beginning of the case.  The ATRO's have the unintended consequence of discouraging immediate division of monetary assets when at least partial immediate division would benefit both parties, reduce animosity, simplify matters, and help get the case over with earlier than otherwise.

QDRO's "Qualified Domestic Relations Orders and Retirement Plan Division

A monetary asset whose division can similarly add to the divorce cost is a retirement plan created to make saved earnings tax exempt as long as they remained saved.  These are either "defined contribution plans" or "defined benefit plans."  Such plans "quailfy" to produce the desired tax deferral by adhering to certain arcane provisions of the Internal Revenu Code.  Because they are "qualified" plans, dividing them requires a "qualified" court order also adhering to the Code.  Such orders are called qualified domestic relations orders, or "QDRO's."  The preparation of QDRO's has become a legal sub-specialty.  Preparation of a proposed QDRO satisfying both parties and the plan administrator can take months.

We could go on and on regarding divorce costs with time consuming and document intensive problems encountered in dividing community property so that the legal rights of the parties are satisfied.  Because each party is typically intent on getting all of his or her legal rights satisfied completely, and each party's attorney knows who will be blamed if that doesn't happen, family law attorneys  are usually afraid of compromises, again dragging out the proceedings.

Determing Spousal Support - Family Code Section 4320

Similar considerations tending to generate long delays and inordinate legal fees are at play in all of the other tasks which must be accomplished to produce a final judgment dissolving a marriage.   Custody and visitation  issues can easily defy a quick resolution, and they usually do.  Rare is the case in which a preliminary pronouncement of complete agreement proves to be true.  Determing spousal support  requires the application of sixteen different factors and sub-factors spelled out in section 4320  of the Family Code.  The amount of potentially relevant information is mind boggling.  Acquiring it can take months.  Analyzing it and arguing over it can take more months thereby significantly adding to your divorce cost.

Getting married is quick and easy.  Getting divorced is slow and difficult. That's the nature of the beast.

Radio Show   Listen to our radio segment "The Expense of Divorce"

 

 

  

 

     

              

   


By Attorney Stan Prowse
Five Star Review Review       On Yelp

    Quotes I went to see Mr. Prowse about a pending divorce. He was very informative. Since this was a long term divorce, I was nervous and scared at the same time. After I met with him, I felt relieved and relaxed. HIs staff was very empathic and compassionate. I would highly recommend Mr. Prowse to anyone going through the same situation.
 
 

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