We split the kids, now what about a settlement?
How, when and where do we get to discuss settlement of our Divorce?
We are all familiar with a person whose divorce never seems to end. A pending Divorce is resolved either by settlement or trial. In some cases, parties will go to Trial if they are unable to resolve the financial matters. This article focuses on those cases involving only financial matters and not custody issues.
Many potential clients ask why they have yet to engage in a settlement conference or mediation, and if they have the option. My answer is always the same: “Yes, all parties have this option, and the Courts praise and support settlement efforts.” Most Court’s require settlement efforts prior to trial.
Potential client’s inquire as to why their matter has not proceeded to mediation. I find most often delay in getting to a settlement conference occurs for a variety of reasons, including the failure of the parties to serve the necessary disclosures, and/or complete investigation through the process of “discovery”, and/or the failure of one party to file a Request for Trial setting with the Court.
“Yes, all parties have this option, and the Courts praise and support settlement efforts.”
Disclose, disclose, disclose financials
The financial disclosures required by the Court can work as a guide for settlement. These forms include
an Income and Expense Declaration (FL-150) and Schedule of Assets and Debts (FL-142). The California State disclosure requirements are intended to avail one party of the other side’s position as to what the Community Assets and Debts are, and their value. These forms are required to be served by both parties within 60 days of filing, or being served, with a Petition for Dissolution.
In the State of California a party cannot be divorced for a period of six (6) months from date of service of the Petition for Dissolution upon the Respondent. However, enforceable settlement agreements may be entered once a Petition for Dissolution has been filed, so long as the agreement is consistent with the requirements and wording as set forth in the California Code of Civil Procedure §664.6. Although disclosures are necessary to finalize a case by the Entry of a Judgment by the Court, a settlement can be entered and made contingent upon the exchange of preliminary/final Declaration of Disclosure(s).
How do we hold a settlement meeting?
To make any settlement efforts productive, both parties should have an understanding of what the assets and debts of the Community are, their value, and the income of the parties for support purposes, assuming this is an issue in the case. It is also necessary for each party to understand what their bottom line is to settle the case. I believe that an understanding of the likely outcome at trial is also extremely helpful to avoid taking an unreasonable position and making settlement impossible.
There are many options for settlement discussions. The parties can engage in private mediation with a retired Judge or Mediator. If an agreement is reached, the Mediator can draft the necessary settlement documents. If the parties are represented, their attorneys can commence settlement negotiations and work with their respective clients to negotiate or reach a Stipulated Judgment (settlement agreement).
In Los Angeles County if the parties have not settled, they will have one final opportunity to meet with a Judge to try and resolve the case during a “Voluntary Settlement Conference”.
In conclusion, in order for settlement negotiations to be productive, the parties need to have completed their preliminary exchange of financial information and have an idea of what they will agree to in order to resolve their case. If this information is unknown, or one party feels they need further information regarding an asset or debt, settlement negotiations may not be productive and instead just frustrate the process.