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Attorney's Fees: So Many Questions, So Little Time .
Jan L. Warner & Jan Collins

Question: My lawyer and I have a fee agreement, and I made payments until our divorce decree required my ex-husband to pay the balance of these fees. When my ex refused, my lawyer took him to the court for contempt. My ex then filed for bankruptcy and is trying to discharge his court-ordered debt to my lawyer. My lawyer wants to charge me to protect these fees. Can my ex-husband discharge a court-ordered obligation to my lawyer? Should I be required to pay yet more fees?


Answer: Family courts often require the husband - assuming he is the dominant wage earner -- to pay the attorney's fees and costs of the wife so she won't have to spend money needed to support her and the children in her custody. Because attorney's fees are considered to be basic needs similar to support, bankruptcy courts throughout the country have repeatedly refused to discharge fees; however, there are no guarantees. Since you and your lawyer have the same interest, it appears to us that you need a united front to try to prevent the discharge of this obligation because if you can't, you will end up paying the bill. We suggest that you work out some type of compromise.


Question: Before my marriage, I began a business with money given me by my parents. This business has become rather successful. When I married eight years ago, contrary to legal advice given to me at that time, I chose not to have a premarital agreement. Now we have split, and my wife is claiming an interest in my business -- even though she has no stock ownership. My lawyer says she is entitled to an interest. Why and how can it be limited?


Answer: If your business appreciated in value during your marriage, it is probable that your wife will be entitled to an interest in the appreciation. The real dispute is the amount of her interest. On one hand, separate property plus the increase in value that you can demonstrate is attributable to passive growth should remain separate property and should not be divided. However, on the other hand, active appreciation -- that is, increases in value based on your wife's direct or indirect efforts and contributions -- is divisible at divorce. Since property division issues generally require professionals from other disciplines, we suggest that you hire a competent forensic certified public accountant who will be able to review the records, trace the growth of the business, and help you limit your liability to your wife.


Question: From the time my retainer was exhausted, my lawyer and I have had a continuing fee dispute which has affected our relationship and my case. His contract -- much to my chagrin --includes a right to take a lien on my property interests. He did this even though all properties are joint and are subject to being divided by the court. Is there anything I can do?


Answer: Your question concerns many litigants throughout the United States. Although attorneys fees are generally matters of contract between lawyers and clients, some states have implemented strict rules which, among other things, provide that divorce lawyers can not take a lien on property to insure payment of fees without prior notification of the other spouse and prior court approval. These rules parallel the Bounds of Advocacy which were previously approved by the American Academy of Matrimonial Lawyers of Chicago. We suggest that you bring these standards to your lawyer's attention.



NOT ENOUGH PREPARATION


When people decide to separate or divorce, important details often fall through the cracks because people don't get prepared. If you think that divorce may be for you, then you must plan, just as you would plan for retirement. Find out about the legal process and consult with competent lawyers and professionals. So ACT, and don't REACT. Don't think that packing your bags and driving away in a car that needs four new tires is the answer. Put tires on the car, fix your child's teeth, and purchase what you will reasonably need. Timing is important, so don't even think about selling the home or other real estate in a down market. And if you've been married for nine years and six months and one of you hasn't worked outside the home, don't divorce until you pass the ten-year mark so the non-financial partner can collect on the working spouse's Social Security -- without reducing the worker's benefits.



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Suggested Reading:
Separation and Divorce Guidebook
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FS-Be Wary of Credit Issues with Ex
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FS-Becareful of Bargaining Away Alimony As Child Support
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FS-Lawyer Tells Me to Lie & Pension Double Dipped
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FS-On and Off Again Reconciles Can Create Agreement Disasters
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FS-The Dangers of Family Loans
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FS-Transference of Affection & 10 Tips of Divorce
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