Attorneys' Fees-Flat Fees or the Billable Hour- Which is Better?

Posted by Daniel Clement on September 27, 2007
Benjamin Stevens offers a thoughtful series of articles on why attorneys and clients benefit from fixed fees in a divorce action.

Some of the benefits cited by Stevens are:

•Clients know the total cost up front, which enables them to determine prior to retaining the attorney whether or not they can afford his/her services and to budget for the attorney's fees and costs.
•Clients have another basis upon which to compare attorneys, both in the manner they charge for their services (fixed fee vs. hourly) as well as the amount charged ($X vs. $Y).
•Clients never end up in fee disputes with their attorneys, because all fees were negotiated and agreed upon before the representation began.
•This method encourages open communication from the client to the attorney. In hourly billing situations, clients sometimes hesitate to provide information to the attorney because they know that they will incur fees and costs for doing so.
•Clients have a higher level of trust with their lawyers, which results in a better working relationship, which frequently yields better outcomes in the clients' cases.
While a flat fee may be appropriate in a matter where the legal representation is somewhat limited in scope, for instance, representing a litigant in an uncontested divorce. At flat fee may be inappropriate in a litigated matter or in a case where the issues will have to be extensively negotiated.

Too often, and particularly in matrimonial mattes, parties take irrational and economically untenable positions fueled by emotions. In the worst cases, parties, left to their own devises would fight about assets with no value. The billable hour is one mechanism of bringing a litigant back to realty. A gentle reminder that cost of litigating about a particular item exceeds the benefit to be achieved oft reins the client in.

In fact, a client who paid his attorney a flat fee has absolutely no incentive to give up the fight and every incentive to assert a position “on principle.” After all, in the case of a flat fee, the legal bill is the same whether or not you prevail. 

I would expect an attorney, working on a flat fee in a contested matter, to price into his fee the potential for a client to act irrationally and to set the fee on the high side. On the other hand, I have heard lots of complaints about attorneys who do not return clients’ calls (I understand this to be the leading cause for attorney disciplinary action) - maybe these are the attorneys that charged too low a flat fee.

Prior Claim of Mental Illness Does Not Invalidate Pre-Nuptial Agreement

Posted by Daniel Clement on September 25, 2007
The New York Probate Litigation Blog highlights the recently decided case of Estate of Joseph Menaham, in which a widow’s attempt to nullify a pre-nuptial agreement was rejected by the Surrogates’ Court.

Prior to marriage, the wife, now a widow, was diagnosed, hospitalized and treated for a bipolar disorder. Following her release, she entered into a pre-nuptial agreement in which the parties each agreed waived their rights to election against the other’s estate. The right of election is a statutory protection which prevents one spouse from dis-inheriting the other.

Following her husband’s death, the widow sought to set aside the pre-nuptial agreement claiming that the bipolar disorder left her unable to knowingly execute the prenuptial agreement.

Surrogate Lopez-Torres noted that a "duly executed prenuptial agreement is given the same presumption of legality as any other contract, commercial or otherwise. It is presumed to be valid in the absence of fraud." The court further referred to section 5-1.1-A(e)(2) of the Estates Powers and Trusts Law which sets forth the requirements for an effective waiver of a spouse's right of election against the estate of a deceased spouse. Such a waiver or release must be in writing, signed, acknowledged and in "recordable" form which means that such a waiver must follow the same form as would be used to provide for the recording of a deed to real property.

The Court viewed this claim with the proper amount of cynicism and found that the widow failed to prove that she lacked the competence to enter into the agreement. As noted in the New York Probate Litigation Blog, the widow earned a professional degree during the marriage and never challenged the validity of the agreement until her husband’s death.

The real focus of the inquiry must be was the wife competent at the time she entered into the agreement. While her mental capacity before and after she signed the agreement may be of some probative value, it should not be dispositive of the issue. If a person could avoid the intended, but harsh consequence of an agreement merely by alleging that at some prior time, he suffered from metal illness, every agreement would be at risk to a subsequent challenge.

Census Says: Marriages Are of Shorter Duration

Posted by Daniel Clement on September 21, 2007
The odds of a marriage lasting twenty five or even fifteen years are decreasing.

Reporting  on recently released marriage census data, the New York Times noted that more than half the Americans who might have celebrated their twenty fifth  wedding anniversaries since 2000 were divorced, separated or widowed before reaching that milestone.

"For the first time at least since World War II, women and men who married in the late 1970s had a less than even chance of still being married 25 years later."

Of course, one of the reasons for this drop-off is that people are marrying later in life increasing the chances that a spouse will be widowed, rather than divorced before reaching their twenty fifth anniversary.

But the percentage of marriages lasting fifteen years is also declining.  “About 80 percent of first marriages that took place in the late 1950s lasted at least 15 years. Among people who married in the late 1980s for the first time, however, only 61 percent of the men and 57 percent of the women were married 15 years later.”

There really does seem to be a "seven-year itch."Couples who separate do so, on average, after seven years and divorce after eight.



Passports To Be Denied to Parents in Child Support Arrears

Posted by Daniel Clement on September 18, 2007
If you want or need a new passport to travel abroad, you had better be current on your child support. The State Department will now deny a passport to any non-custodial parent owing $2,500 or more in court-ordered child support.

As Janet Langjahr points out, the new passport rules while implemented as a matter of national security, has the effect of benefiting children owed child support.

The Governor of Connecticut reported that this policy has had a tremendous effect on child support collections:

Since January 2007, when the new federal passport rules were announced, Connecticut has collected nearly $180,000 from 44 non-custodial parents who were notified that their passport privileges were in jeopardy -- a significant jump in the normal collection rate from passport denial.”

The rest of the country is seeing a similar effect. In the first six months of 2007, about $22.5 million in child support was collected nationwide through the federal Passport Denial Program. It took all of 2006 to collect about that much through passport denials.

This is an added tool in the child support collection arsenal. In New York, parents who have defaulted in making child support payments faced the loss of their driver’s and professional licenses. Now, if you fail to pay support, not only will your professional license be suspended and your driving privileges revoked, you will not even be able to go vacation.

Hidden Assets and Illicit Affairs Revealed By Electronic Devices

Posted by Daniel Clement on September 17, 2007
The New York Times featured a front page story on how computers, blackberries, cell phones and other electronic devices are being used to discover adulterous relationships and hidden assets.

The Mississippi Family Law Blog points out these electronic devises all leave a  trail which may be discovered during the course of litigation.

Folks need to understand that if you use a computer or a phone, you are leaving an electronic trail which can easily be followed. Once divorce proceedings begin, the discovery process can allow your spouse to discover e-mails and inspect computer hard drives. Just because you hit the delete button does not mean the data is gone. Many times it is easily recoverable.

But, before resorting to self-help cyber-sleuthing, it is imperative that you consult with an attorney, to ensure that you do not violate federal criminal law.  Stephen Worrall on the Georgia Family Law Blog has written extensively on this subject.

While the electronic crumbs left on a computer may evidence attempts to secrete assets, the Asset Search Blog details how money laundering schemes and other attempts to hide assets have been frustrated.

In short, in most cases, through due diligence and sheer bull doggedness, hidden assets will be discovered.

Presidential Candidates Grounds for Divorce

Posted by Daniel Clement on September 12, 2007
A number of the presidential candidates are divorced. Fred Thompson, John McCain and Rudy Guliani are all divorced. Should the reasons for their divorces be fodder for their qualifications as President?

For instance, there has been discussion on the blogosphere about Fred Thompson’s divorce based upon “cruel and inhuman” treatment. Does this mean the Thompson was a wife-beater or a victim of domestic violence?  Not necessarily.

As one commenter pointed out in The Atlantic:

Cruel and inhuman treatment" (or something similar) is a common legal cause of action in the divorce law of many states. In states without no-fault divorce, one needs (or needed) a legal cause of action in order to file for divorce. One of those causes of action is "cruel and inhuman" treatment.

In New York, for instance, where a “No Fault” divorce is not an option, unless the parties are willing to be legally separated for a year, their divorce must be fault based. Cruel and inhuman treatment is one available option for a grounds based divorce.

On the other hand, we will never know if Thompson selected his grounds for divorce because it was a means to an end, a quick divorce, or because there were actually incidents of domestic violence. If an irreconcilable differences grounds for divorce was available, would the Thompson’s have pursued a divorce based on cruel and inhuman treatment?

Divorce Rates Soar Even in Saudi Arabia

Posted by Daniel Clement on September 07, 2007
Divorce is not only rampant in America. Crossroads Arabia reports that divorce is so prevalent in Saudi Arabia that divorce lawyers are turning away new clients.

Sixty-two per cent of marriages in the western region in Saudi Arabia end in divorce, with a large percentage of those being less than 25 years of age.

The number of young divorcees is increasing. Some are getting divorced after one or two years of married life. Coming across a 20-something divorcee is not strange anymore. Khaled Abu Rashid, a Saudi lawyer, said that with a huge number of divorce cases, law firms in Saudi Arabia are burdened with so much work that sometimes they have to refuse taking cases. He said that divorce among young couples was increasing and added that a lot of his clients are between 18 and 22 years of age and that many disputes revolve around child custody.
There are certainly cultural reasons for rampant divorce rate; many of the marriages are arranged. Regardless, I cannot help but wonder if the law in Saudi Arabia is as backwards as New York’s which requires parties to prove marital fault. 

Can I Move Away With My Child: The Law of Re-Location

Posted by Daniel Clement on September 05, 2007
I have returned from my vacation, schools back in session and summer is, for all accounts over. So, I am back to bloggging on a regular basis.

One of the most common post-divorce scenarios is that the custodial parent wishes to relocate and the move will negatively impact on the other parent’s relationship with the child. The Nassau County Family Court in the case Mr. G. v. Mrs. M (New York Law Journal, 8/28/07 (subscription required) provided a excellent primer on the subject and in doing so, denied a mother’s application to move with her child to Virginia.

As laid out in the leading case of Tropea v. Tropea, the issue is to be determined as is in the best interest in the child. In doing so, the Court is to consider the following criteria:

1.Each parent’s reason for either seeking or opposing the relocation;


2.the current state of the relationship between each parent and the child;

3.the impact that the relocation will have on the quality and of the child’s relationship with the non-custodial parent;

4.the emotional, economic and educational effects that the move will have on the child; and

5.the feasibility of maintaining the relationship between the child and non-custodial parent.

The trial court must weigh all of the factors and determine not what would be best for the parents but, rather, what is in the best interests of the child.