Trusting the Disclosure

Among those contemplating a collaborative divorce, one of the most commonly asked questions is how each party can be certain that the other has, as the agreement requires, in fact accurately and completely divulged all of their financial information?

Maybe you’re concerned that your soon-to-be ex, who asked for the divorce, has been squirrelling funds away for months or years. Or maybe he or she is a skilled dealmaker who you know is capable of moving money in creative ways. At the very least, this person is ending their marriage to you—possibly because collaboration between you two didn’t go so well. So why should you trust that full disclosure has been made?

The collaborative process incorporates some safeguards to address and mitigate those very concerns. For starters, the collaborative divorce does not tolerate withholding information. When you begin the collaborative divorce process, you will be asked to sign a contract agreeing to full disclosure. Attorneys should also incorporate a hidden assets clause in the final divorce agreement.

Moreover, if your attorney knows you are stalling or fudging on your disclosure, he or she is bound by the same collaborative divorce contract to withdraw. And your attorney is likely to assure you that the cost of the subpoenas, depositions, interrogatories and other discovery procedures required to get disclosure via the court system are costly indeed. It is in everyone’s best interests to be truthful and forthcoming throughout the disclosure process.

The neutral financial professional who is likely to be a part of your collaborative divorce team should be an extra set of eyes. He or she is likely to ask for several years’ worth of financial records, both to get a sense of your lifestyles and needs and to see whether there are irregularities.

Finally, and perhaps most relevant, if you and your spouse have agreed to a collaborative divorce it’s because you want to avoid a fight and hope that settling as amicably as possible will set you on the road to becoming respectful, civil ex-partners and/or co-parents who are able to set the past aside. In the long run, full disclosure likely buys you more—more good will, more assets with which to start over and less likelihood you’ll be back in court revisiting your settlement in years to come.