My blog is meant to inform but its primary purpose is not to be informative. It is about the law but it is not solely about the law but also about those places the law does not go. The law is the platform from which I dive. My blog is about my opinions but is not primarily about my opinions since I often temper these to the subject matter on hand, not to mention the imagined audience. Quite often when I open a subject which is related to the law for discussion, I find myself in a place I never meant to be, or to go, as if the subject takes on a life of its own. I write articles based on what I do for a living, and I am a family lawyer, but of course that is not all I am. I find that when I engage with a subject, and use writing to express my thoughts, that quite often the journey is more interesting than the end and that what I thought I was writing about is not what I wrote about at all. This seems to me to be a metaphor for life. I write, therefore, to throw some light into the dark, to increase my understanding and by extension hopefully, other people’s understanding of what often seems incomprehensible, to enliven the dull so my spirit does not sag and to throw some humour at what is often deeply sad so that I can, or maybe, dare I say hopefully, “we”, can gain perspective. I doubt I succeed but the effort is honest.
Tuesday, October 19, 2010
Cost of Living
There are a lot of people out there worried about day to day finances and coping with unhappy marriages and relationships at the same time. Certainly, where there is already strain, a poor financial situation can completely unbalance things. There is no doubt that legal costs are a big issue if you are separating. Lawyers in common with everyone else have reduced their costs but going to court is still a very expensive option for any family in these straightened times. The Legal Aid Service is there to help out. It is worth noting that the Legal Aid Service will charge a fee for their service should you get money in your settlement or court order. Many people are not aware of this. Quite often the fees charged by the Legal Aid do not differ a whole lot from that charged by many private solicitors. Most family lawyers charge a first consultation fee particularly in the cities. This is because a first consultation can be very time consuming and difficult both for the professional and the client. Clients very often have little or no idea what to expect and it can take some time to focus and gather oneself. Quite often people are too upset to convey information easily at this meeting or are in great need of reassurance. All of which takes time and skill. Because many people come to lawyers for advise when they are not sure what they are doing or may want to do, many will not necessarily come back having taken a great deal of time and so we find that we have to charge for first consultations. In Cork the majority of family law specialists will charge between €150 and €250 plus vat for that consultation which can often last up to two hours.
Settling your affairs with your spouse/partner is by far and away the most cost effective and logical way to resolve a family dispute. Whether you settle by way of agreement conducted between firms of solicitors, private mediation, collaborative family law or in the courthouse, it is still less expensive financially and emotionally than having a full hearing in front of a judge. The least expensive option is a mediated settlement followed by agreement conducted between firms of solicitors and collaborative family law which on average are pretty much on a par financially though not in any other respect followed by settlement in the courthouse and last and most expensive full hearing. A full blown hearing in the Circuit Court can cost anywhere between €8K and €20K plus VAT plus outlays and any other expenses involved such as valuers, accountants etc. Some cases are more time consuming than others, they involve more correspondence, more phone calls, more consultations, briefs to various experts, interim trips to court leading up to the full hearing which all mounts up costs wise. Again remember that from a lawyer’s perspective, time is money and solicitors are looking at your case from a costs point of view in terms of billable hours. Court cases take a long time to gestate and come to term. This impacts on costs and can be very wearying for the person on the other end. Solicitors start to speak an incomprehensible language about drafting documents, briefing counsel, issuing proceedings, service of proceedings, filing, expediting, Motions, Discovery, Affidavits, Registrar’s courts, rules of court, precedents, settlement talks and hearings. None of this makes any sense to you and on top of that it is all taking an unending amount of time to come to a conclusion. You just want it finished and you don’t want to hear all this mumbo jumbo!! Then after what seems to you like an absolute hellish eternity, they slap you with a large bill for doing stuff most of which you did not understand in the first place and have no idea why it was necessary in any event. Welcome to the world of the adversarial court system! By contrast the world of Alternative Dispute Resolution (ADR) works to your pace, is at pains to speak a language you understand, makes itself as user friendly as possible and all the work being done is conducted in your presence or with your knowledge and you know exactly what you are paying for and how much you will be paying.
Negotiated settlements between solicitors leading to either a Separation Agreement or a court ruling by consent, while less expensive than a full blown hearing and preferable to going to court, are still expensive ,especially, emotionally expensive. The type of negotiation involved in solicitor’s negotiation is distributive bargaining. I wrote about this in my last blog and website posting. It involves looking for the biggest slice of the pie for one’s client and since there is only one pie one person has to take less than the other. This type of bargaining also looks at the pie in a very one dimensional way. It does not ask questions to determine the parties’ real needs so as to see how value might be created. Also distributive bargaining frequently uses gamesmanship, bullying, hiding information and other such tactics to succeed. All of which can leave a bitter taste in the mouth. The correspondence between the solicitors leading up to the court case is often a classic example of this where each party sets out their stall in an attempt to undermine or diminish the other’s confidence or simply to bully them into submission. Accordingly, by the time you arrive at a settlement a lot of unnecessary damage has been done. A Separation Agreement conducted through solicitors negotiating in the traditional way can cost anywhere between €3,500 plus vat and €8,000 plus vat again depending on the amount of correspondence, telephone calls and consultations involved with the client, settlement meetings (if any) and drafts and redrafts of the agreement. A privately mediated agreement will cost around €2000 plus vat per head on average depending on whether you opt for co-mediation, which is what I like to practice, or the more traditional one mediator model which would be somewhat less. A collaborative family law case depending on whether it is full team or just lawyers and clients, will average between €6K and €12K per head. For that you get a tailored custom made solution with a range of experts at your disposal which takes account of the family needs and not just individual members and which is future focussed and not just dealing in the now.
When looking at legal costs it is also worth noting that solicitors do not conduct their work over a few days, it can take months and sometimes years to bring cases to a conclusion. People ask us all the time why our costs are so high and the answer is very straightforward, our overheads are huge. At the moment I am paying professional indemnity insurance and an annual practising certificate fee of around 25% of my turnover. In addition, I pay all the usual business expenses, rent for my office, accountancy fees, office equipment and running costs, business loan and one administrative staff member, public liability etc.
Many solicitors will look for money on account before taking on a court case and that is not at all unusual. That money is offset against your fees at the end of your case and is not additional to the fee charged overall. It is used for office running costs in respect of bills being run up managing your case and while your case is ongoing but also to ensure payment of people retained on your behalf ie, auctioneers, doctors reports, psychologists, accountants, barristers etc. A solicitor retains these people to act on your behalf and is, therefore, liable for their fees. If, however, there is some very good reason why you cannot place any monies on account and you can give reasonable assurance of payment at the outcome of the case, most solicitors will consider your position. Another option which is finding favour now is payment as you go. I tend to favour this as do my clients. It does involve a bit more office administration but it is worth it to keep the clients happy. Generally, clients pay me every 3 or so months bringing themselves up to date so as to avoid having to put a larger sum of money on account and also having a big bill at the end of the case. Talk to your lawyer about costs, be up front and you may be surprised and how well you are understood and what he or she will be prepared to do for you. If your lawyer does not discuss costs with you or fobs you off whenever the subject is raised with platitudes, then alarm bells should go off.
I think many of us are living in some kind of suspension waiting for this to end but we shouldn’t put our lives on hold. Who knows how things will turn out. We need to move on with our lives.