Dividing up the financial cake in a divorce
Divorce cases are rising along with property prices, but splitting up has cost implications
For some couples, divorce has been off the agenda for the past few years, as a combination of tough personal financial circumstances, falling property prices and negative equity have made ending a marriage even more difficult than it needs to be.
Now, however, rising property prices in Dublin mean divorce is back on the agenda for couples looking to draw a line under their marriage and move on.
“What’s happening increasingly now is that properties are coming back into equity, and it’s far easier to settle cases,” says family law solicitor Marion Campbell.
While divorce can undoubtedly be an emotionally turbulent time, it can also be an expensive one, so here are some of the various routes to divorce – and how much they might cost.
But, whichever route you go down, it’s worth remembering that divorce is not necessarily the end of the road.
As Muriel Walls of family law practice Walls & Toomey notes, the legislation does say that on granting decree, at any time thereafter, it is possible to make maintenance orders or property adjustment orders, for example.
However, she adds that while in theory it’s a possibility, the reality is that the courts would be very, very slow to interfere with the original agreement “unless something catastrophic happens”.
Apply for legal aidIf your income is below a certain threshold, then you should be able to qualify for subsidised legal aid from the State-funded Legal Aid Board. While legal aid is not free, depending on your income you may pay as little as €130 to be represented in your divorce by a solicitor, although an additional capital contribution might also apply.
However, as Noeline Blackwell, director at the Free Legal Advice Centre (Flac), says, it is “very strictly means tested”. After accounting for tax and allowances, such as your mortgage, and the number of children you have, your income needs to be less than €18,000 a year to qualify.
“If you are just €1 over it, you will be entirely cut off,” says Blackwell.
And even if you do qualify, you might find yourself waiting a long time for a preliminary appointment – depending on where you live.
According to Blackwell, in Cork you could wait for up to a year, while in Nenagh, Co Tipperary, the waiting list is five weeks long.
Do it yourselfIf you don’t qualify for legal aid, and don’t want to part with a significant sum to pay for legal services privately – or simply don’t have the funds – one low-cost option is to go it alone and file your own divorce papers.
This is perfectly legal under Irish law, and can be achieved for less than €100.
It’s possibly most suited for people who either already have a judicial separation, or who have already hammered out all the details of the divorce.
From seeing couples represent themselves in the courts, Walls has noted that it’s typically two types of people: young couples who may have been married for only a short period of time and with few or no complications, or couples in their 50s/60s who may have been separated for 20 years and who long ago reached agreement on the dissolution of their assets.
If you do decide to go down this route, it is worth putting in the groundwork. You can find relevant books in a public library; ask a circuit court for a copy of divorce papers; learn about other people’s experiences online; or attend a Flac centre, which is free and you are able to attend as often as you like.
However, while it’s a low-cost option, if there are any contentious areas in the divorce, such as issues over custody and access to children; on-going issues related to maintenance; or the couple have pensions which have to be divided – or if you simply fear turning up in court without the support of your solicitor – then it may not be the best route.
“It’s like doing your own plumbing. In a sense, you are disadvantaged when you don’t quite know what you’re doing, or the jargon,” says Blackwell.
Campbell agrees that it can be difficult for someone without a legal background to be fully aware of everything that might be pertinent in a divorce, such as working out a pension-adjustment order, or life assurance in the event that a spouse who is paying maintenance should die.
Also, if one partner has been dominant in the marriage, it might be difficult for the other partner to assert themselves fully without the aid of legal representation.
DIY – with some
helpIf going it alone is just that bit too scary, you could enlist the services of a DIY service provider to help smooth your path.
Just like you might use an online service to help file your taxes rather than pay for an accountant, there are now several outfits operating in Ireland which promise to help you go through the divorce, for a fixed low-cost fee.
Marianna Fritz of Irish Divorce Services has noticed a “big increase” in the number of people opting for this route in the past few years.
“A lot of people feel that they have paid €5-€10,000 on a separation agreement and everything has been dealt with, so they don’t see why it’s necessary for the divorce to use solicitors again,” she says.
Irish Divorce Services, for example, offers two options: €349.95 for a self-managed divorce, or €499.95 to allow Irish Divorce Services manage it for you. Additional costs may also apply, such as €149 for a pension-adjustment order.
DIY Divorce Ireland is running a special offer of €397 for its services, while users of Groupon could recently buy a “€249” divorce from Local Divorce Services, discounted from €500.
With such services, you will still attend court alone, but you will get help in preparing the documentation.
Firms offering such services are typically not solicitors, so they are not in a position to offer legal advice or opinions.
If you start off representing yourself and circumstances change, or the divorce proceedings become more contentious, you are not precluded from seeking legal representation at some point during the proceedings.
Legal representationHaving a solicitor on your side to hammer out an agreement which is in your interests – and communicate with your spouse, from whom you may have become estranged, or their representation – may be worth its weight in gold, at what can be such a traumatic time.
Depending on the nature of your divorce however, it may also feel like excessive money.
In May, for example, a woman seeking a divorce told the judge of the “immense pressure” she was coming under from her solicitor to pay the €10,000 costs bill.
If going down this route, Blackwell recommends you agree to a fixed fee, but notes that, much like a builder might change his estimate mid-way through a project, a solicitor may increase their fee if the complexity of the case increases.
Campbell will often agree with clients to pay legal fees monthly or bi-monthly, so they aren’t stuck with a sizeable bill at the end. Depending on where you are in the country, typical fees will start at about €2,000, but can quickly reach five figures depending on the case.
Campbell says that fees for a relatively straightforward divorce will typically start at about €7,000 plus VAT (23 per cent), while a case running in the Circuit Court for two days could cost between €15-€20,000. And if both parties have legal representation, then the total will be double this.
A barrister may also be required, depending on complications regarding property, access, pensions or maintenance, which can significantly increase costs.
Walls, however, says she will “only bring in counsel to a very tricky case”, noting that solicitors can typically deal with most issues that might arise in a divorce case themselves. Fees for a High Court case could reach six figures, but since the recession these have been rare.
The more a couple can agree before enlisting the services of a solicitor(s), the cheaper the case is likely to be – however, lack of agreement may be the reason why legal representation was sought in the first place.
MediationIf a couple doesn’t already have a separation agreement in place, availing of mediation services can help them. What’s critical however is that both sides agree.
“Our experience is that it is more suited to dealing with parenting issues than court. Court should be about deciding on issues of law and fact, not whether a child should be collected at 11am or midday,” says Blackwell. “Mediation can give a much better solution to a family than the courts ever could.”
The State offers a free mediation service, which can help couples negotiate their own terms of agreement by coming to mutually acceptable arrangements on everything from custody of the children to what will happen to the family home.
It usually takes between two and six sessions to come up with a written document which can then be drawn into a legal deed of separation and/or decree of divorce.
The waiting time for mediation has come down and may be availed of within weeks.
As a possibly quicker alternative, couples can also opt to pay for mediation privately.
Career on hold: Is there compensation for the spouse who sacrificed work opportunities for family? It’s not something many people consider – and it’s not always women though it most frequently is – when they decide to move into the career “slow-lane” for the sake of their family, and allow their spouse to put in the extra time needed to further their career. But could job-sharing, working part-time, or simply sticking to 9-5 hours at the expense of future career prospects cost them if their marriage was to fall apart?
After all, as Muriel Wall of family law practice Walls & Toomey, notes, the courts typically offer spousal support or alimony to spouses who are completely dependent on their partner and who are not working.
“If you took a traditional older couple case for example, where the wife is in her late 40s/50s and hasn’t been in the workplace for 15 years, in those circumstances there could be spousal support,” she says, adding that in the case of a young couple in their 30s, both of whom are working, there “probably won’t be spousal maintenance”.
Family law solicitor Marion Campbell agrees that there is “very much a move away from it (spousal support) by the courts”.
However, while both spouses might be working, the person who let their career take a back-seat may be earning significantly less than their partner. In such cases, where a spouse has prejudiced their own career for the sake of their family, then this will be taken into account in reaching a settlement.
“If there is a significant disparity between what the husband and wife is earning, they could still claim spousal maintenance,” says Walls, who notes that this order might be for just a limited period of time, until the wife can go back to work full-time.
Another possibility she says is that the husband will have to do the “heavy lifting” when it comes to either minding the children himself, or paying for suitable childcare, to allow the woman progress her career, rather than pay spousal support.
However, while the spouse who dedicated more time to rearing their children might feel aggrieved that they let lucrative career opportunities slip by and now have to support themselves on a lower salary, it can be difficult for the higher earning spouse to financially compensate them for this.
“There’s only so much money in the pot,” says Walls.
Another challenge is that courts are increasingly ordering sales of the family home.
“Unless one or the other is in a position to either take over the mortgage and the banks consent to that, then there may be no other option but to sell that property,” says Campbell.