A husband and wife had been equal partners in a small business together for 25 years. Their company was worth over $1 million. The couple also owned undeveloped land in a rapidly growing area worth three or four million dollars, as well as other developed real estate worth about two million dollars. They had teenage children.
The wife had come to the agonizing conclusion that she wanted a divorce, and she was referred to Mark by a therapist familiar with the collaborative divorce process. During her initial consultation, Mark explained that process along with other options for divorce, including litigation, arbitration, and mediation. She decided she wanted to avoid court. Mark suggested that she talk with her husband to see if he would interview attorneys who had experience in collaborative law proceedings. Her husband met with such an attorney, and, after learning about the various court and non-court options, he also opted for the collaborative process.
Once they had made that decision and engaged their respective attorneys, the couple focused on their children. The relationship between the youngest child — their teenage daughter — and one of the parents was strained. Both parents were worried about the impact the divorce would have on her, but for different reasons. As a result, the parents disagreed about how they should share time with their daughter once they separated.
On the recommendation of the collaborative attorneys, the husband and wife retained a neutral child specialist. That specialist met individually with each of the parents to understand their concerns. She also met with the teenage daughter and talked with the daughter’s regular therapist. The child specialist then attended a collaborative conference with the couple and their attorneys. At the conference, she reported what their daughter was experiencing as a result of the divorce and offered helpful insight into how the parents could better meet the child’s needs during the difficult transition. As the parents and their attorneys began to discuss custody plans in more detail, the child specialist was able to be their daughter’s “voice,” ensuring that her needs and interests were considered. Though the process was emotionally taxing, the parents were able to agree to a parenting plan and custody schedule that they both thought would be in the best interests of their daughter.
Meanwhile, the couple continued to meet every few weeks with their attorneys to discuss how to divide their marital estate. The wife’s priority was having her autonomy, so she wanted to cut ties with the business and be bought out by her husband. Luckily, there were sufficient assets in the marital estate to allow for a buyout, but the assets were in the form of non-income producing real estate. The husband believed that it would be optimal to hold the properties for future development, rather than sell the properties immediately as part of the divorce settlement. But without the proceeds of the sale of the properties, the wife would have no investment income to replace the income she had been receiving from the business.
The couple jointly retained a financial neutral in the collaborative process to provide a valuation of the business and to help them develop possible financial strategies for dividing the assets and providing for the cash flow needs of the separated households. After several conferences with the attorneys and the financial neutral, the couple agreed to a buyout price and structure. They agreed to delay the sale of their real estate holdings to maximize the sales price; instead the husband would pay the wife monthly payments to replace her lost income until they sold those properties. The amount of those monthly payments was determined with the help of the financial neutral. He worked with each of the parties to project their living expenses in separate households to make sure that the payments would cover the wife’s projected expenses without creating a shortfall for the husband. The payments were credited against the wife’s share of the value of the business.
They agreed that once the real estate holdings were liquidated, the balance of the buyout of the business would come due to the wife. After the parties each received half of the net proceeds from the sale, the husband would pay to his former wife the balance of the buyout amount for the business from his share.
With these agreements, the attorneys were able to jointly draft a formal Separation Agreement and Property Settlement so that the couple could proceed with their divorce without court hearings to determine child custody and equitable distribution of the marital estate. In a final collaborative conference, the attorneys went through the agreement with the couple on a large monitor, made final edits, printed the agreement, and the couple signed. There was sadness at this final meeting, but there was also considerable relief that so much of the conflict they had been experiencing for years was coming to an end.