Arons & Solomon | February 18, 2015 | Articles
If you are considering a divorce in the state of New Jersey, understand the differences between Litigation, Mediation and Arbitration.
No two marriages are alike and, in like manner, no two divorces are alike. Each presents its own unique personalities and issues. You and your spouse may be able to reach an agreement and avoid “litigation” entirely. If you reach the agreement before either of you has filed a Complaint for Divorce, the Court need only decide whether to grant the divorce. Along the way, you have resolved issues that a Judge would have decided if you and your spouse were not able to do so–-issues like child support, parenting time, payment of debts, valuation and division of assets, and the like.
But what if you hit a bump in the road and just can’t reach a resolution of all of your issues? Then before either of you files a Complaint for Divorce, consider seeking the assistance of a mediator. Mediators are neutral third-parties skilled in the art of mediation and also highly knowledgeable of New Jersey family law. Most often, they are experienced family lawyers. The mediator you choose will request information regarding your financial situation, including your income, assets and debts.
The mediator will help you and your spouse identify and understand the issue or issues, gather the information needed to resolve the issue or issues, and suggest solutions that you might not have thought of on your own. Often those solutions require compromises in which each of you gets something of what you want, but not all of it. Furthermore, these are often solutions that a judge cannot order if the issues are presented to him to determine. And, unlike decisions reached in a courtroom, mediation facilitates resolution of issues in an informal, non-adversarial manner.
You and your spouse may have already retained lawyers to represent each of you. You may decide that you prefer that your lawyers attend the mediation sessions with you or you may each decide that you prefer to attend mediation without lawyers. Whatever you decide, it must be mutual. In other words, one of you cannot attend with a lawyer and the other attend alone.
It may take more than one session with a mediator to resolve your issues. Once you and your spouse feel you have reached an agreement that you both can live with, your mediator may draft what is called a Memorandum of Understanding (MOU) in which he or she outlines the major issues and their resolution. Be sure to read it carefully to ensure that the MOU accurately reflects your understanding of how the issues were addressed.
Now it is time for you or your spouse to take the MOU to a lawyer to convert it into a Marital Settlement Agreement (MSA), which more fully describes the issues and their resolution and contains additional language considered important in such documents (often called “boilerplate”). The MSA may go back and forth between attorneys and several versions may be drafted and discussed before everyone agrees on the final wording of the MSA. Once you and your spouse and your counsel have signed the MSA, it is time to file the Complaint for Divorce. As previously stated, this leaves the Court with having to make only one determination and that is whether to grant the divorce. That will be done at what is called an uncontested hearing.
At that hearing, the judge does not review your Agreement, nor does he determine whether it is fair. You and your spouse are questioned by your respective attorneys regarding, among other things, whether you understand the Agreement, whether you believe that the Agreement is fair, and whether you understand that you had a right to have a trial and are waiving that right. When the judge is satisfied as to your testimony, he signs a Final Judgment of Divorce, the official document evidencing your divorce. That document and your MSA should be kept together as one document and maintained in a safe place with your other important documents.
Neither you nor your spouse can appeal, and assuming that both of you acted in good faith and revealed all assets, debts, etc., the division of assets set forth in the agreement cannot be challenged due to a change in circumstances experienced by either you or your spouse. Clearly, mediation can be a much more cost-efficient way of resolving issues in a divorce, but its success depends upon a couple’s ability to work together to reach a mutually acceptable agreement.
However, if you and your spouse are not able to resolve all or some of your issues on your own or with the assistance of a mediator, your recourse is to enter the realm of litigation. Assume that one of you decides to file a Complaint for Divorce. Assume further that the other side has answered the Complaint and both of you are “in the case.” Be prepared to have to go to Court with your respective attorneys for what is called a Case Management Conference where the issues will be determined and your case placed on a “discovery” track, which will vary in length depending upon the complexity of issues in your matter. Know that regardless of the track you are placed on, the New Jersey Court Rules require judges sitting in the Family Part to be ready to try your case within one year of the date that the Complaint for Divorce was filed.
During this information-gathering phase of your case, or “discovery,” each side will be served by the other side with requests for information, which may be in the form of questions to be answered (“interrogatories”) or documents to be provided (notices to produce documents). If your case involves issues relating to valuations of businesses, property (real or personal), custody, etc., experts may have to be retained to prepare reports setting forth their findings. Depositions may have to be taken. You may be ordered to attend custody/parenting- time mediation.
During this time period, issues may arise relating to support, parenting time, etc., that require immediately resolution–-they cannot await a final determination at trial. Your attorney may recommend that you file an application with the Court to ask the Court to grant you specific relief to address those issues. Those applications, called either Motions or if of an emergent nature, Orders to Show Cause, are time-consuming, stressful, and expensive ways of resolving your differences. Yet where a spouse is being uncooperative, vindictive or not acting in the best interest of his/her children, they may be unavoidable.
At some point, you and your spouse will be ordered to attend an Early Settlement Panel (ESP). 2-3 attorneys, depending upon the County in which your case is venued, will serve as ESP panelists and receive proposed settlement statements from your attorney in advance of the date of the ESP. On that day, after speaking with your attorneys, they will meet with you and your spouse and your attorneys together to give their recommendations as to how your case should settle.
Assume that you or your spouse do not agree with the recommendations of the ESP panelists and your case does not settle. Then you will be ordered to attend economic mediation with a mediator listed on the Court’s list of approved economic mediators. Most likely, you will be ordered to an All-Day Intensive Settlement Conference at the Courthouse should economic mediation fail and you will be given a trial date.
Preparation for the trial is time consuming and very costly, which is why more than 95% of all cases settle without the need for a trial. Witnesses must be determined, their testimony must be drafted, and they must be prepped for trial, exhibits must be identified and pre-marked for the Court, a trial brief must be drafted–-the preparation list is endless.
Making litigation even costlier is that fact that in most cases, trials are not continuous. You may get a full day of trial here, a half-day a week or two later, and if your case is complex, this piecemeal presentation of your case may go on for months. There may be lengthy waiting periods outside the courtroom when the judge handling your matter has to interrupt your trial to handle an emergent matter or when his/her scheduled non-trial calendar for that day takes longer than anticipated.
Once your trial is over, it may be months before the judge renders a decision in your case. And if either you or your spouse disapproves of that decision, and either of you decides to appeal, there is the additional cost of the appeal, the drafting of briefs, assembling of appendices (containing copies of documents that were submitted into evidence at trial), oral argument. Expect at least an additional two years for a decision from the Appellate Division.
It is clear from the foregoing that litigation adds to the emotion and stress of what is already a difficult and stressful time. Before you decide to go this route, be sure that you have discussed it thoroughly with your attorney, that he/she has answered all of your questions and that you have very good reasons for embarking on the litigation path.
Having filed a Complaint for Divorce and having not reached an Agreement, you find yourself in the midst of litigation. You don’t believe there is anyway that your matter can settle. There is going to be a trial. Maybe you want to try to save money or avoid the stress of a trial. Or maybe the issues to be resolved involve unreported income or tax issues that will likely lead to you or your spouse–-or perhaps both of you–-being reported by the Court to the taxing authorities (i.e., a so-called “Sheridan” issue, named after the case in which it was first decided). Perhaps it would be better for the issues to be resolved by someone outside of the judicial system. Perhaps you simply cannot wait for a Judge to have the time to address your case.
In that event, you may want to discuss the possibility of the matter being decided by an arbitrator rather than by a judge at trial. An arbitrator is an impartial third party that you and your spouse select. Arbitrators are usually skilled attorneys or retired judges. He/she decides the issues in the case that you and your spouse have agreed he/she will decide. And you and your spouse agree in advance if the arbitrator’s decisions will be binding or not. Even if you agree they are binding, you can still provide for appeal, so long as it is agreed to in advance.
Arbitration may be less formal than a trial proceeding and scheduling can be more controlled, meaning that it can be a more efficient and less costly proceeding than a trial, even though the parties have to pay the arbitrator for his/her time. Keep in mind that it is still the judge in your matter, not the arbitrator, who decides whether to grant the divorce. Accordingly, in most cases, the parties enter into an Arbitration Agreement, an uncontested hearing is held at which the judge enters a Final Judgment of Divorce, and the matter then goes to arbitration.
The facts of your case should determine which of the methods outlined above you choose to resolve the issues in your divorce. You may employ one or a combination of methods, but whatever you choose, be sure that you have discussed your options with a knowledgeable attorney. Our attorneys at Arons & Solomon will take the time to explain your options, present the best course of action for your case, and guide you through the process with sound advise and support.