HIGH-NET-WORTH DIVORCE COURT LITIGATION VERSUS PRIVATE MED-ARB: WHICH IS RIGHT FOR YOU?
Are you considering filing for or in the middle of a high-net-worth divorce in Ontario? If so, here’s what you need to know as you choose between high-net-worth divorce court litigation vs private med-arb, an exciting alternative dispute resolution process.
WHAT IS DIVORCE LITIGATION?
Court: Divorce litigation is a complex legal process that involves resolving divorce-related matters through the court system. The involvement of substantial assets in high-net-worth divorce cases only makes the litigation process more complicated.
Courts Backed Up: Many Ontario courts are simply hopelessly backed up. There are many Superior Court judicial vacancies that the federal government has neglected to fill. Many high-net-worth couples are turning to alternative modes outside of court to resolve their issues.
Privacy is another key challenge in divorce litigation, as court proceedings and documents are generally public, a significant concern for many high-net-worth individuals. Additionally, the duration and cost of litigation in these cases are often considerable, given the complexity of the issues and the resources available to parties with higher net worths.
Are There Alternatives?: Because divorce litigation is so complex, time-consuming, and costly, many divorcing couples consider alternative dispute resolution approaches. Mediation is one. Arbitration is another. The two wedded brilliantly together is called “med-arb”. It’s an astonishing hybrid process that combines the best of both modalities (being ‘mediation’ and ‘arbitration’) and brings to the divorcing couple many advantages such as convenience, choice of decision-maker, cost savings, finality, privacy, flexibility, and simplicity. Does Colman like it? You bet.
HOW IS MED-ARB DIFFERENT?
Your Own Chosen Decision Maker: Unlike litigation, in which a judge makes binding decisions, the med-arb process is distinct as the parties choose their own neutral third-party decision maker. Such a person is generally an experienced family law lawyer who is specially trained and trusted by both sides’ lawyers.
Two Stages: Med-arb is short for “mediation/arbitration”. The first stage is mediation. The neutral senior lawyer helps the parties reach their own agreement. If that becomes impossible, then that person puts on his/her arbitrator hat and decides the case just as a judge would. But the parties themselves, via their lawyers, have set up expeditious procedures that short-circuit much of the expensive, time-consuming paperwork that characterizes the divorce litigation model.
Why You Need Legal Help: There are unique dynamics in the med-arb model. It is important to have on your side a sensitive legal team who understand the nuances of the process. How you negotiate in the med-arb context, how you make interim compromises, how you position yourself for what might become a formal ‘arbitration’ – these are all factors that are crucial to high-net-worth divorces.
To appreciate the attractiveness of med-arb, let us first examine the palpable benefits of mediation.
Less Adversarial: Mediation is generally less adversarial and more collaborative, allowing parties to communicate with each other in a structured but less high-stakes setting. This aspect is particularly beneficial in high-net-worth divorces, where the complexity of assets requires detailed and nuanced discussions that aren’t always feasible in court.
Privacy: Another major advantage of mediation in high-net-worth cases is the privacy it offers. Mediation sessions are private and confidential, unlike the public nature of court proceedings in litigation. This confidentiality is attractive to many high-net-worth individuals, who generally wish to keep their financial affairs and personal matters away from prying eyes.
Save Time and Costs: Mediation is also often more time and cost-efficient than litigation. High net-worth divorces can involve lengthy and expensive court battles due to the extensive financial assets at play. Conversely, mediation allows for a more streamlined process, often resulting in quicker and less costly resolutions.
Flexibility: Flexibility is another key benefit of mediation. The parties have more control over the process and their agreements, which is particularly valuable in high-net-worth cases where standard solutions might not apply. This flexibility also extends to scheduling, allowing parties to work through their issues at their own pace rather than on the court’s timetable.
Med-arb Advantages: All these mediation benefits transfer seamlessly into the med-arb model. The key advantage is that if you don’t achieve that agreement in mediation, then the person who already knows your case will be the arbitrator or final decision maker. Your efforts to resolve this within the mediation stage are not wasted.
Most med-arb cases settle at the mediation stage. Need I say more?
DO YOU NEED A LAWYER FOR MED-ARB?
Yes. Even if you choose med-arb over litigation for your high-net-worth divorce in Ontario, there are several reasons you’ll want a lawyer on your side.
Knowledge and Complexity: First, the complexity of high-net-worth divorces requires a lawyer’s in-depth knowledge. Lawyers experienced in this area can effectively handle complex financial matters, including business interests, investments, and offshore assets. They ensure proper valuation and disclosure of all assets, protecting your financial interests in the process.
Tactics: Second, a lawyer can provide valuable legal and tactical advice throughout the med-arb process. They help you understand your rights and obligations and ensure that any agreement you reach is fair and serves your best interests. This guidance is especially important in high-net-worth divorces, where the stakes are high, and the financial consequences are significant.
Drafting: Additionally, lawyers play a key role in drafting and reviewing both the med-arb agreement that kicks off the process as well as any mediated resolutions that may be achieved. The lawyer ensures that any agreements adhere to legal standards and are both enforceable and fair, preventing future disputes or legal challenges.
CONTACT A HIGH-NET-WORTH DIVORCE LAWYER TODAY
If you are considering high-net-worth divorce court litigation versus private med-arb, the Gene C. Colman Family Law Centre is here to guide you throughout the process. Secure the support and guidance you deserve in this critical phase of your life. Contact us today to arrange your remote initial consultation, or get started online now.
