When the Lawyer Is a Client

Almost half of all first marriages in the United States will end before the couple reaches their 20th anniversary. Lawyers are not immune to that statistic. In fact, given the demands our profession makes on our time, our attention, our energy and the stress that places on our personal relationships, the divorce rate among lawyers likely rivals that of any other profession.

At the same time, lawyers ' especially equity partners ' may have unique vulnerabilities, including the valuation and treatment of his or her ownership interest in the firm and the possibility that sensitive firm financial and other information is open to being made public.

This article offers the following considerations for those attorneys who are contemplating divorce:

Resist the Temptation to Be Pro Se

We all have heard the adage that a lawyer who represents himself has a fool for a client. In a divorce case, that is especially true. Regardless of your legal acumen, emotions will cloud your judgment and will only complicate your case. With your financial security and the well-being of your children at stake, it is not the time to go it alone. Good representation is worth the financial investment.

Participate Constructively in Your Case

No one knows the story of your marriage and the facts of your case better than you. Be active in educating your counsel about the good, the bad and the ugly of your marriage so he or she can be best prepared to form a case strategy and have a superior command of the facts when dealing with opposing counsel. Where appropriate, you may be able to shave some costs by helping with the drafting of pleadings and participating in discovery, but ultimately, defer to your counsel and let him or her do the job you hired him or her to do.

Get Your Financial House in Order

One of the most critical tasks in a divorce case is identifying all of the parties' assets and debts, as well as their expenses and all sources of income. Both to expedite the discovery process and to help your counsel understand your finances, it is in your interest to gather and organize all the supporting documentation necessary to create the complete financial picture.

• In terms of income and expenses, start with personal tax returns for the last five years, and a copy of the family “budget,” ideally created and managed by a Quicken-type program. If you do not have a budget, re-create one through a review of bank and credit card statements for at least the last two years. Capturing the historical spending of the family is imperative when dealing with temporary or permanent support issues.
• To demonstrate assets and debts, a net worth statement is ideal, prepared by you or your financial adviser and, if applicable, any personal financial statements submitted to any lender in the last several years. Your counsel also will need current statements on all of your bank, investment and retirement accounts, any deeds, appraisals or other documents related to your real property interests, and documentation of any other illiquid assets and debts.
• Be sure to identify any existing assets that you owned at the time of the marriage or received during the marriage by gift or inheritance, as those assets may be deemed separate and not subject to equitable division.
• Depending on the type of law you practice, you also may encounter valuation issues with respect to your interest in your firm and related benefits, which could entail intensive discovery and the involvement of forensic and valuation experts.

Have 'the Talk' with Your Partners

Naturally, you wish for your personal legal matters to stay personal, and to avoid your colleagues getting involved in your divorce. Unfortunately, that is not always possible. If divorce is imminent, go ahead and prepare your partners for the very real possibility that information about the firm's finances and its inner workings will be requested and must be disclosed, including production of the partnership agreement and other sensitive documents. Having a confidentiality order in place prior to any production is highly recommended and hopefully will assuage any firm concerns about the security of the information released.

You Will Be Held to a Higher Standard

We all know that ignorance of the law is not a valid defense. Knowledge of the law may not always help either. To the extent your case involves an issue of knowledge or intent surrounding a transaction ( e.g. , execution of a prenuptial agreement, transfer of a deed), be prepared to be held to a higher standard than the lay person.

Do Not Overplay Your Hand

For lawyers, particularly litigators, there can be an inherent advantage over his or her nonlawyer spouse in a divorce case due to the lawyer's tolerance, or even appetite, for the stress of litigation, which is foreign and often overwhelming to a non-lawyer. Where appropriate, this advantage can be leveraged to achieve a favorable result. It can also be abused. Your non-lawyer spouse already will be anxious and doubtful he or she will receive a fair result “playing on your turf.”

Disabuse them of that belief by avoiding aggressive litigation tactics and instead working toward an amicable settlement. Take ownership and control over the outcome of your case. Not only will you avoid the financial and emotional costs of litigation, you will almost certainly arrive at a more fair and comprehensive result than that from a judge or jury who, in a matter of hours, could not begin to fully understand and appreciate the intricacies of the life it took you and your spouse years to create.

When to Hold 'Em, When to Fold 'Em

Before you rush to the courthouse, be mindful of any sensitive information that litigation may uncover and make public. Indiscretions, for instance, can affect your personal reputation and are best kept private. But where the “conduct” involves illegal activity, such as drug use or questionable business and/or tax practices, the stakes can be considerably higher. Mediation, arbitration and even private trials provide effective and more discreet alternatives to the courthouse. Take what steps you can to protect the reputation you have worked so hard to gain.

Be Smart

Divorce has a way of bringing out the worst in some people, causing them to do things they would not ordinarily do. Think twice before you place spyware on your spouse's computer, or access their personal or work e-mail accounts without their knowledge or consent, or plant a recording device in his or her car. These actions go beyond “snooping.” They are invasions of privacy that in an increasing number of states have resulted in criminal prosecution. If you think you need to explore your spouse's comings and goings, hire a licensed private investigator.

If You Can, Make It Work

There is a wide range of catalysts that bring about divorce: affairs, verbal or physical abuse, unavailability, drugs or alcohol. But the common denominator among them is almost always an extended breakdown in communication, shared interests and intimacy.

Conclusion

As lawyers, the demands of our job make us particularly susceptible to these risks. Be mindful of that as we all strive to achieve that elusive balance of work and family.

Jonathan J. Tuggle is the immediate past chairman of the Family Law Section of the State Bar of Georgia, and a founding partner of Boyd, Collar, Nolen & Tuggle. This article also appeared in The Daily Report, an ALM sister publication of this newsletter.

Almost half of all first marriages in the United States will end before the couple reaches their 20th anniversary. Lawyers are not immune to that statistic. In fact, given the demands our profession makes on our time, our attention, our energy and the stress that places on our personal relationships, the divorce rate among lawyers likely rivals that of any other profession.

At the same time, lawyers ' especially equity partners ' may have unique vulnerabilities, including the valuation and treatment of his or her ownership interest in the firm and the possibility that sensitive firm financial and other information is open to being made public.

This article offers the following considerations for those attorneys who are contemplating divorce:

Resist the Temptation to Be Pro Se

We all have heard the adage that a lawyer who represents himself has a fool for a client. In a divorce case, that is especially true. Regardless of your legal acumen, emotions will cloud your judgment and will only complicate your case. With your financial security and the well-being of your children at stake, it is not the time to go it alone. Good representation is worth the financial investment.

Participate Constructively in Your Case

No one knows the story of your marriage and the facts of your case better than you. Be active in educating your counsel about the good, the bad and the ugly of your marriage so he or she can be best prepared to form a case strategy and have a superior command of the facts when dealing with opposing counsel. Where appropriate, you may be able to shave some costs by helping with the drafting of pleadings and participating in discovery, but ultimately, defer to your counsel and let him or her do the job you hired him or her to do.

Get Your Financial House in Order

One of the most critical tasks in a divorce case is identifying all of the parties' assets and debts, as well as their expenses and all sources of income. Both to expedite the discovery process and to help your counsel understand your finances, it is in your interest to gather and organize all the supporting documentation necessary to create the complete financial picture.

• In terms of income and expenses, start with personal tax returns for the last five years, and a copy of the family “budget,” ideally created and managed by a Quicken-type program. If you do not have a budget, re-create one through a review of bank and credit card statements for at least the last two years. Capturing the historical spending of the family is imperative when dealing with temporary or permanent support issues.
• To demonstrate assets and debts, a net worth statement is ideal, prepared by you or your financial adviser and, if applicable, any personal financial statements submitted to any lender in the last several years. Your counsel also will need current statements on all of your bank, investment and retirement accounts, any deeds, appraisals or other documents related to your real property interests, and documentation of any other illiquid assets and debts.
• Be sure to identify any existing assets that you owned at the time of the marriage or received during the marriage by gift or inheritance, as those assets may be deemed separate and not subject to equitable division.
• Depending on the type of law you practice, you also may encounter valuation issues with respect to your interest in your firm and related benefits, which could entail intensive discovery and the involvement of forensic and valuation experts.

Have 'the Talk' with Your Partners

Naturally, you wish for your personal legal matters to stay personal, and to avoid your colleagues getting involved in your divorce. Unfortunately, that is not always possible. If divorce is imminent, go ahead and prepare your partners for the very real possibility that information about the firm's finances and its inner workings will be requested and must be disclosed, including production of the partnership agreement and other sensitive documents. Having a confidentiality order in place prior to any production is highly recommended and hopefully will assuage any firm concerns about the security of the information released.

You Will Be Held to a Higher Standard

We all know that ignorance of the law is not a valid defense. Knowledge of the law may not always help either. To the extent your case involves an issue of knowledge or intent surrounding a transaction ( e.g. , execution of a prenuptial agreement, transfer of a deed), be prepared to be held to a higher standard than the lay person.

Do Not Overplay Your Hand

For lawyers, particularly litigators, there can be an inherent advantage over his or her nonlawyer spouse in a divorce case due to the lawyer's tolerance, or even appetite, for the stress of litigation, which is foreign and often overwhelming to a non-lawyer. Where appropriate, this advantage can be leveraged to achieve a favorable result. It can also be abused. Your non-lawyer spouse already will be anxious and doubtful he or she will receive a fair result “playing on your turf.”

Disabuse them of that belief by avoiding aggressive litigation tactics and instead working toward an amicable settlement. Take ownership and control over the outcome of your case. Not only will you avoid the financial and emotional costs of litigation, you will almost certainly arrive at a more fair and comprehensive result than that from a judge or jury who, in a matter of hours, could not begin to fully understand and appreciate the intricacies of the life it took you and your spouse years to create.

When to Hold 'Em, When to Fold 'Em

Before you rush to the courthouse, be mindful of any sensitive information that litigation may uncover and make public. Indiscretions, for instance, can affect your personal reputation and are best kept private. But where the “conduct” involves illegal activity, such as drug use or questionable business and/or tax practices, the stakes can be considerably higher. Mediation, arbitration and even private trials provide effective and more discreet alternatives to the courthouse. Take what steps you can to protect the reputation you have worked so hard to gain.

Be Smart

Divorce has a way of bringing out the worst in some people, causing them to do things they would not ordinarily do. Think twice before you place spyware on your spouse's computer, or access their personal or work e-mail accounts without their knowledge or consent, or plant a recording device in his or her car. These actions go beyond “snooping.” They are invasions of privacy that in an increasing number of states have resulted in criminal prosecution. If you think you need to explore your spouse's comings and goings, hire a licensed private investigator.

If You Can, Make It Work

There is a wide range of catalysts that bring about divorce: affairs, verbal or physical abuse, unavailability, drugs or alcohol. But the common denominator among them is almost always an extended breakdown in communication, shared interests and intimacy.

Conclusion

As lawyers, the demands of our job make us particularly susceptible to these risks. Be mindful of that as we all strive to achieve that elusive balance of work and family.

Jonathan J. Tuggle is the immediate past chairman of the Family Law Section of the State Bar of Georgia, and a founding partner of Boyd, Collar, Nolen & Tuggle. This article also appeared in The Daily Report, an ALM sister publication of this newsletter.