Saturday, February 1, 2014

Is Collaborative Law Cheaper than Litigation?

Is Collaborative Law cheaper?  Probably.

Is Collaborative Law cheap?  Not necessarily, but it's all relative.

The Players.  In Texas, each party hires their own attorney.  Then, the attorneys select a neutral mental health professional (MHP) and a neutral financial professional (FP) to work with both parties.  That sounds like a lot of expense, but keep in mind that the MHP and FP do a lot of independent work in the case at a cost of less than half the charge of just one of the attorneys.

The Process.  We will have a series of joint meetings to  discuss and review facts and issues in the case. (We follow a Roadmap that is a step by step process of setting goals, gathering information, generating options and coming to agreements.)  At the joint meetings, we usually have both attorneys and both other professionals, unless we are just talking about non-financial children's issues.  Then we would have the attorneys and MHP.

Efficiencies. The Collaborative process operates very efficiently regarding creating a parenting plan and gathering and organizing financial records.  We have "offline" meetings with just the MHP and the parties on parenting issues and just the FP and the parties to do the preliminary financial work.

In a litigated case, the attorney typically would be meeting with their client to gather information and formulate a plan on parenting issues.  The MHP is much less expensive and probably more qualified to help the parties than either attorney.

Similarly on the financial issues, in litigation, the attorney would be telling the client what information is needed, then would review whatever was produced and would prepare an Inventory and Appraisement. The FP is much better qualified and less expensive in gathering, organizing and evaluating the finances.  In addition, the FP helps both parties plan and prepare budgets for post-divorce, which is rarely done in litigation.

Comparison in litigation

Hearings.  Especially in hotly contested cases, there are multiple hearings at the courthouse.  That means time off work, preparation time and attorney's fees.  We usually average about three hours at court every time a case has a hearing because we end up waiting around to be heard and then there's the time in the hearing.  And there are the inevitable postponements and resets.

Discovery. In litigation, we usually do discovery, which is a formal process involving written requests for information and as a result, the gathering of voluminous, often irrelevant, documents and photos that have to be copied or put on a disk for the other side.  Parties usually spend thousands of dollars on discovery alone.  Then there are often fights, and more hearings, about whether all the documents requested were produced.

Inventory and Appraisement.  This is like an expanded version of the joint spreadsheet used in Collaborative cases, but with a lot more detail, and each side prepares their own.  That means more than twice the cost.

Depositions.  These are a means of discovery where a witness is under oath and is asked questions by one or both attorneys.  There can be a number of these.  Each client will pay for the attorney's fees and some court reporter cost.

Mediation.  Most cases will settle in mediation.  The problem is that mediation usually takes place after many months, often just before trial.  You will pay the mediator as well as your own attorney.

Trial.  If mediation fails, you will go to trial. In Tarrant County, it usually takes 9 months to a year or more to get to trial.  Trials are also very expensive.

Paperwork. In addition to theses steps, there will be a lot of paperwork, from letters back and forth to pleadings and orders and discovery documents. It all costs money.

Bottom Line:  While Collaborative cases may seem expensive if viewed with no context or comparison to litigation, they actually are usually a lot cheaper than contested litigated cases.  In the Collaborative process, there are no hearings, discovery, Inventory, depositions or trial.  There's usually no mediation and there's a lot less paperwork.

If you want to compare processes, look at all the costs!

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