How An Expert Can Help Your Divorce Case: Insights from the 2016 Family Law Financial Forum

Recently, Attorney Karen Greenberg and I had the opportunity to attend the 2016 Family Law Financial Forum, an event hosted by Massachusetts Continuing Legal Education. This program featured a panel of experts in the financial aspects of divorce, and included attorneys, business valuators, and accountants with varying certifications and specialties. The all-day presentation allowed me, as a new lawyer, to learn from seasoned practitioners. Because the panelists have tested creative solutions in divorce cases, they could weigh in on the viability of innovative approaches; because the presenters had seen mistakes made in practice, they could impart lessons learned; and because the speakers have worked with many experts in the family law community, they could identify helpful resources. While there was a lot to learn at this event, the biggest takeaway for me was that, in some cases, retaining a financial expert can be critical.

Over time, families have become increasingly complex. Not only has family structure and division of caretaking responsibilities changed dramatically, but the financial supports for many families have also become more complicated. For example, a spouse may earn bonus income or receive stock options from his or her employer rather than simply receiving a regular salary. A couple may own assets that are more difficult to value than cars and bank accounts, such as trust interests or a closely held business. The need for a financial expert is heightened by such complex financial arrangements.

In cases such as these, proceeding without an expert means taking risks. A spouse risks receiving an inappropriate child support order because income has not been properly accounted for. There may be unforeseen tax consequences because the proper analysis was not undertaken. A party risks “overpaying” alimony to an ex-spouse because his or her income is misunderstood. Assets may be divided inequitably because their true value is unknown, and not presented to the court. This is especially dangerous given that orders of property division cannot be changed. These risks, however, can be mitigated by utilizing a financial expert.

There are several types of financial experts. For example, real estate appraisers, business valuators, forensic accountants, and CPAs would all fall under the general “financial expert” umbrella. Once employed, the expert could fill one of two roles. The expert could be what is called a testifying expert. Testifying experts analyze relevant information and communicate their opinion to the judge. Alternatively, an expert could be a consulting expert. A consulting expert works with the lawyer to better understand certain information and guide the attorney’s inquiry. The type and role of the expert is determined by the needs of the particular case.

Many clients may wonder whether hiring an expert is really necessary; after all, they have already hired an attorney to handle this problem for them. In complex cases an expert may be the only means to obtain an accurate accounting of the marital assets. Of course, the additional cost of retaining a financial expert may be financially burdensome but there are ways to minimize the extra cost. For example, parties may agree to jointly retain an expert to value a marital asset or hire an expert to take preliminary steps and evaluate the need for further work as the engagement proceeds.

At the end of the day, an expert can minimize uncertainty and risk, and help to ensure that a party receives all that is coming to them. And that is priceless.

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