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Need Not Be Divisive In the event of a divorce, a husband and wife generally are free to divide their property as they see fit. To facilitate division of property, they may enter into what is called a marital settlement agreement. A marital settlement agreement is a contract between a husband and wife that divides property and debts and resolves other issues of a divorce. Although many divorces begin with a high level of acrimony, a substantial majority of divorces—95 percent or more—are settled by a husband and wife, with help from attorneys, without the need for a judge to divide property or decide other issues. When a husband and wife reach a marital settlement agreement, they can take the agreement to court, where a judge usually will approve it after a short hearing. Some states with simplified divorce procedures might not even require a hearing if the husband and wife agree on everything stated in the agreement. Settlement agreements operate in what is sometimes referred to as “the shadow of the law”—meaning that agreements are influenced by the parties’ and their attorneys’ awareness of how a judge might decide the case. It may not be possible to predict with complete precision what a judge would do, but an experienced attorney can predict a range of possible results. With those theoretical results in mind, parties often prefer to reach their own agreements rather than go through the monetary and emotional expense of a trial. The decision whether to go to trial to have a judge decide contested issues often involves a cost-benefit analysis. If the financial benefit that may result from a trial is high compared to its cost, it may make sense to go to trial. For example, if the parties dispute the value of a business started by the husband during the marriage, and the difference in their valuations is substantial, then it may make sense to let a judge decide the issue rather than submit to unreasonable valuations proposed by one side or the other. In the example stated above, the parties would need to look at the facts objectively. How much attorney time will it take to develop facts about the business? How much will it cost to hire an expert to evaluate the business and testify at trial? If, after gathering preliminary information and attempting negotiations, the husband still says the business is worth $50,000 and the wife still believes the business is worth $1 million, the only way to solve the problem may be to go to court. On the other hand, if the business is very small, and the husband says it is worth $15,000 while the wife says it is worth $25,000, it may not make much sense for one or both sides to spend $10,000 in attorney’s fees and expert’s fees to ascertain the business’s precise value. From Guide to Marriage, Families and Divorce |
