How Much Does a Divorce Cost?

Divorce is not cheap. Larry Rich explains the kind of money you will need to pay your legal team in order to go through with the divorce successfully.

By Larry Rich
April 28, 2006

Dear Client,

Divorce Financial Planning/Investment

In response to our recent meeting about the cost of a divorce, from a legal cost/accounting cost perspective, I would like to advise you accordingly. My information regarding legal fees is based on loose discussions I have had over the years with various family lawyers.

QUOTES FOR SERVICES

All quotes for services relate to the required work in the circumstance, that is, hourly rates (agreed upon in advance) multiplied by the required number of hours required. This quote excludes disbursements and applicable taxes (which does not refer to all disbursements but includes all fees rendered). Hourly rates listed range from junior lawyers and junior accountants to senior lawyers and senior accountants.

LAWYERS 
Fees can range from $100 to $450 per hour, but the average rate would be (i.e. based on intermediate level of experience) $275 per hour.

ACCOUNTANT
Fees can range from $125 to $350 per hour depending on the level of expertise required, averaging at $250 per hour.

RANGES OF SERVICES

(a) SIMPLE DIVORCE
This occurs where there is no corollary relief claimed in pursuit of a simple undefended divorce and as a result, there is no property support, custody matters, or related relief requested.
Estimated Cost
Legal -- flat fee can range from $400 to $700 plus $300 to $400 for disbursements plus applicable GST

(b) CONTESTED DIVORCE
Services are broken down into various stages. The range of the number of hours in each stage can vary dramatically with each case. THIS POINT CANNOT BE OVER-EMPHASIZED!

Just because a contested action commences at stage 1 (noted below), it does not mean that each of the stages noted on the following pages occur to achieve finality. A settlement can occur at any stage, resulting in elimination of the remaining stages. The number of hours expended at any stage will vary directly with the following factors:

  1. COMPLEXITY OF MATTERS AT ISSUE
  2. THE EXPERTISE OF YOUR LAWYER AND ACCOUNTANT AND THAT OF OPPOSING PROFESSIONALS
  3. THE RESOURCES AVAILABLE TO YOUR LAWYER AND ACCOUNTANT TO ASSIST IN THE CARRIAGE OF THE FILE AND THE EXISTING RESOURCES FOR THE OPPOSING PROFESSIONALS
  4. THE SOPHISTICATION AND INTELLIGENCE OF THE CLIENT
  5. THE WILLINGNESS OF THE CLIENT TO ASSIST HER PROFESSIONALS (LAWYER AND ACCOUNTANT) IN PROVIDING, ASSEMBLING INFORMATION, ETC.
  6. THE CLIENT'S SPOUSE'S INTELLECTUAL/EMOTIONAL ABILITY TO RESOLVE THE OUTSTANDING ISSUES WITHOUT THE NEED OF GOING THROUGH ALL OF THE FOLLOWING STAGES
  7. THE COMMITMENT OF ALL PARTIES INVOLVED, INCLUDING THE PROFESSIONALS OF THE CLIENTS, TO RESOLVING ALL OUTSTANDING ISSUES AS COST-EFFECTIVELY AS POSSIBLE. THIS IS THE OVERRIDING VARIABLE.

STAGE ONE: PLEADINGS

This stage presupposes that an action had to be commenced by one party owing to the inability of the parties through their counsel to negotiate agreement without the necessity of an action. Most lawyers, in many cases, attempt to resolve the outstanding issues by way of trying to negotiate an agreement before stage one.

TIME Lawyer: 1-15 hours (per pleading)
Accountant: 1-3 hours (per pleading)
COST Lawyer: $275-$4,125
Accountant: $250-$750
Total cost: $525-$4,875

This range of costs applies to your cost (exclusive of the other side) to prepare a pleading (i.e. statement of claim or petition for divorce). The other spouse's professionals will also have to respond to the pleadings, including a statement of defense, and will be required to answer with a counter-petition.

STAGE TWO: FINANCIAL STATEMENTS

Financial statements include actual and budgeted costs of living, detailing with supporting documentation weekly, monthly, and yearly costs, plus supporting documentation relating to weekly, monthly, and budgeted income, including but not limited to employment income, investment income, and all other advance receipts, whether taxable or not. In addition, the financial statements will include a detailed supporting listing of all assets and liabilities at the date of marriage and at the date of marriage breakdown, with certain exceptions. Where an asset is a bank account, it is easy to determine the balance or value at the required time. Where the assets relate to the value of a business, incorporated or otherwise, non-dependent valuation may be required from a chartered business valuator.

PREPARING FINANCIAL STATEMENTS
TIME Accountant: 1-25 hours
Lawyer: 1-5 hours
COST Accountant: $250-$6,250
Lawyer: $275-$1,375
VALUATION OF BUSINESS
C.B.V.: $3,000-$35,000
TOTAL cost: $3,525-$42,625

Again, the time and cost varies with the circumstances, the complexity of the matter, and the availability of information supported by documentation.

STAGE THREE: MOTION

Preparation of documents can take from three to 20 hours for the lawyer, depending on the number of affidavits required, plus the complexity and length of content required in the preparation.

PREPARING DOCUMENTS (Lawyer)
TIME: 3-20 hours
COST: $825-$7,500
ARGUE MOTION IN COURT
TIME (INCLUDING WAITING): 1-15 hours.
COST: $275- $4,125
Total cost: $1,100-$11,625

STAGE FOUR: EXAMINATION/ CROSS-EXAMINATION

The cost of the examination for discovery stage can range from one to 25 hours for the lawyer, which does not include preparation time of one half to eight hours. In addition, I would review the other side's financial statement and prepare a list of questions for your lawyer when your spouse is examined.

CROSS-EXAMINATION TIME & Cost:
Lawyer: 1-25 hours -- $275- $6,875
PREPARATION TIME & Cost:
Lawyer: ½ -8 hours -- $137.50-$2,200
Accountant: 2-8 hours -- $500-$2,000
Total Cost: $912.50-$11,075

STAGE FIVE: CASE CONFERENCE OR PRETRIAL

Time can range from two to six hours for preparation, plus time at court, which could be one to 15 hours, including waiting time at court, to work towards a settlement of the dispute.

COST
Lawyer: Preparation -- $550-$1,650
Court -- $275-$4,125
Total lawyer: $825-$5,775
Accountant: Court -- $250-$1,500
Total cost: $1,075-$7,275

STAGE SIX: TRIAL

Assume one to two days of preparation for every day of trial for your lawyer. Your accountant could be required to assist your lawyer in his preparation of financial details and also to discuss strategy. The accountant's time will be 1/2 of the lawyer's preparation time with a minimum of one day.

COURT TIME
Lawyer: two hours to three weeks
Accountant: two hours to three weeks (or 60 days x seven hours/day)
COST
Lawyer: $550-$28,875
Accountant: $500-$26,250
Total: $1,050-$55,125

SUMMARY OF RANGE OF COSTS

PLEADINGS Lawyer: $275-$4,125
Accountant: $250-$750
Total: $525-$4,875
FINANCIAL STATEMENTS Lawyer: $275-$1,375
Accountant: $250-$6,250
Accountant, C.B.V.: $3,000-$35,000
Total: $3,525-$42,625
MOTIONS Lawyer: $1,100-$11,625
EXAMINATION Lawyer: Cross $275- $6,875
Preparation: $137.50-$2,200
Accountant: Preparation $500-$2,000
Total: $912.50-$11,075
CASE CONFERENCE Lawyer: Preparation $550-$1,650
Court: $275-$4,125
Total: $775-$8,255
Accountant: Court $250-$1,500
Total: $1,075-$7,275
TRIAL Lawyer: $550-$28,875
Accountant: $500-$26,250
Total: $1,050-$55,125

TOTAL AS FOLLOWS Lawyer: $3,437-$60,850
Accountant: $4,750-$71,750
Grand TOTAL: $8,187-$132,600

This is an outline of what to expect if you decide to proceed with your litigation. The range of time and costs is simply a guideline for range of time and costs: sometimes the time and costs exceed the range, and sometimes they are less. Your cooperation, your spouse's cooperation and the quality of the various professionals on both sides will dramatically affect the outcome of your costs.


Larry W. Rich is a senior partner at Rich Rotstein. A 30-year veteran, he has handled diverse assignments ranging from tax planning to dealing with creditors in matrimonial disputes.

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