Financial settlements in divorce tend to be plagued by two easily avoidable mistakes. 

One is attempting to make financial settlement proposal before there has been full disclosure of assets, debts, income and expenses.

The other is focussing on the mistaken belief that someone who does not accept a settlement proposal is somehow unreasonable.

Accepting an offer without understanding the full financial picture, would be like accepting an offer for an unwanted painting and later finding out it was a valuable Old Master. At first, you are glad to be offered something for it. Later you will probably feel cheated.

So, am I saying that once there has been full financial disclosure, a reasonable settlement proposal is always going to be accepted? In a word, “no” – that’s the second mistake.

Trying to persuade someone that an offer is reasonable is usually a waste of time. If you try to sell a proposal by emphasising how reasonable it is, it follows that you are likely to interpret any unwillingness to accept it is a sign of unreasonableness, which will not typically be the case. This causes mutual resentment –  “I’m reasonable but my spouse is unreasonable”.

Think about it. Client A is told by lawyer A that their case is reasonable. Client B is told by lawyer B that their case is reasonable. They are both being told that they are being reasonable. So if they are both being reasonable, how come they can’t settle? It follows that they each think the other is being unreasonable. Result? A battle with spiralling and uncontrollable financial costs as attempts are made by each to persuade the other of their “reasonableness”.

If they manage to eventually agree, it is rarely before either one or both of them have either lost the will to fight, or can no longer finance the legal costs. If they cannot agree, a judge has to decide. Judges make decisions based on what judges think is reasonable. This may turn out to be be very different to what either the lawyers or the disputants think.

Instead of trying to show why a proposal is reasonable, husbands and wives should be preparing to make sure their proposals are acceptable. Acceptability will win hands down over reasonableness every day. How do they do this? By following  a few basic guidelines. which apply whether you attempt a DIY approach, mediation, collaboration, arbitration or even the court process. Each of them should:

1. Make a list of their own assets, debts, income and regular outgoings.
2. Collect together documents to support  these values, such as bank statements, pension valuations, mortgage repayment figure and pay slips.
3. Share the lists and documents with each other.
4. Ask questions of the other, and provide answers when asked.
5. Bring in a financial specialist to help both if needed.
6. Before making any proposal, consider the capital and income needs of themselves  and any children.
7. Make proposals that clearly meet both their needs and those of any children.
8. Negotiate over any differences
9. Reach a mutual agreement.

This will work for 95% of people, regardless of whether they are high or low conflict.

While I practised as a family solicitor for 19 years, I know this process works best through mediation. This is because in mediation, a single mediator helps both participants follow the steps. Managing them like a project manager would.

There is no secret to sorting out the financial side of divorce. So long as these basic steps are followed, in the right order, divorces will be less emotionally and financially  taxing, and will achieve a timely financial settlement.

I am Stephen G Anderson. I am a professional mediator.