How do family lawyers and financial advisers work together in collaborative divorce?

In this episode of Podcasts by Brodies, Debbie Reekie, legal director at Brodies LLP gives an insight of the collaborative process from a family lawyer perspective. We’re also joined by Martin Donnelly, a chartered financial planner at Trinity Bridge who shares the value in having a financial adviser in collaborative process.

This episode discusses how a family lawyer and a financial adviser, both trained in collaborative practice, work together to help clients reach fair, informed decisions without going to court during a separation or divorce. From dividing assets to planning for the future, they discuss how collaboration fosters clarity, reduces conflict, and puts families in control of their outcomes.

All information in this episode was correct at the time of recording. The content of Podcasts by Brodies does not constitute legal advice. 

Transcript

00:00:06 David Lee, podcast host

Hello, and welcome to Podcast by Brodies. I'm your host, David Lee, and in this episode, we're looking at collaborative practice in family law for couples separating or divorcing. I'm joined for this episode by Debbie Reekie, a legal director at Brodies and a family lawyer, and also by Martin Donnelly, a chartered financial planner at Trinity Bridge.

So, what we're going to look at today is how do a family lawyer and a financial advisor, both trained in collaborative practice, work together to help clients reach fair and informed decisions without going to court?

How do they divide assets?

How do they plan for the future?

How do they help reduce conflict and put families in control of what comes next?

So welcome, Debbie, welcome, Martin. Debbie, let's start at the very beginning, which is always a very fine place to start. What is collaborative practice in family law and how does it differ from more what we might call traditional approaches?

00:01:05 Debbie Reekie, legal director at Brodies LLP

Thanks David.

The collaborative process is a non-confrontational approach to the legal, financial and practical arrangements for separation and divorce. In the collaborative process, both parties instruct collaboratively trained lawyers and the whole process is conducted through very carefully planned meetings. And that means that traditional lengthy emails and letters, which may otherwise go between lawyers, are avoided. And the focus is on constructive solution-focused meetings.

In advance of the meetings, the two lawyers will normally speak with each other and discuss the case. And that's useful to ensure that there's a proactive or a productive agenda for the meeting. And it can also be really useful in identifying any hotspots that might exist and that can really help the lawyers navigate those difficult areas together for the benefit of the two parties.

One of the main cornerstones of the collaborative process is that all parties must sign a participation agreement. That commits everyone, including the professionals, to act with respect and dignity throughout the process. It also prevents the couple from instructing their collaborative lawyers to raise a court action if their negotiations fail.

If the negotiations were to fail, then everybody, the lawyers, the financial advisors, everybody would have to come out, and the parties would have to start again. And committing to the participation agreement and to not raising a court action really means that everybody participating has a real interest in reaching a successful conclusion.

And I should say that while the collaborative process is traditionally used for separation and divorce, it could be used for other kinds of cases. For example, it could be used for negotiating and agreeing the terms of a prenuptial agreement, for example.

One of the benefits about the collaborative process is that other professionals can be brought in. So financial advisors such as Martin can be brought in and also family consultants. So, we've obviously got Martin here, so I won't mention too much about the financial side right now, but the family consultants can be very helpful. People going through a separation finds it very hard, it's very stressful, it's very emotional and having that emotional support can be really crucial for some people. It can help provide them with an emotional anchor which enables them to better make more informed decisions about their future.

And the family consultants can really help parties with children navigate their separation in a way which is child focused and it helps to protect them from conflict. The collaborative process is a way for parties to retain control over their separation. So, it's very unlike court or arbitration where a decision is imposed upon them. In the collaborative process, the couple have the freedom to agree what they feel is fair and what's going to work well for them and for their family. And that might not look like a traditional settlement, but it will be one which really benefits everyone.

00:04:05 David Lee, podcast host

Okay, great stuff. Thanks very much, Debbie.

So, Debbie, just briefly to follow on before we bring Martin in, are there particular types of situations where

this collaborative practice is particularly appropriate.

00:04:38 Debbie Reekie, legal director at Brodies LLP

I would explore potential collaboration with most clients. And if someone comes to me and there's already a court action live, then we can't collaborate. But in many other cases, collaboration is a sensible option, which should at least be discussed and explored. At a very early stage in a client's case, I would normally want to explore with them how disputes are resolved between them and their partner. And that can give me quite a useful insight into that couple's dynamic and whether the collaborative process might be a good one for them.

The cases in which collaboration might not work is where there's a considerable lack of trust or there's a significant power imbalance. There needs to be trust between the parties. They have to share information. They've got to work together to resolve their separation. And if one person is hiding information or withholding crucial details, then the process can't work. It's a kind of all cards on the table set up.

00:05:32 David Lee, podcast host

Okay, great stuff. Thanks again, Debbie.

And coming to you, Martin, what's your role? As a financial planner in a collaborative divorce process? And how do you support all parties?

00:05:47 Martin Donnelly, chartered financial planner at Trinity Bridge

Hi, David.

Yeah, so generally speaking, have been introduced to the process after both parties have engaged with their legal representatives. And therefore, there's some information already been collated in the background, which I lean on. I interpret those statements. I dig a little bit deeper into gathering information around what's important to both parties. And through that interpretation, aim to provide neutral feedback, not advice, using respectful explanations and allow constructive dialogue to ensue between both parties.

00:06:28 David Lee, podcast host

Okay, and what are the advantages in being specifically trained in collaborative practice, Martin, in situations like this?

00:06:38 Martin Donnelly, chartered financial planner at Trinity Bridge

I tend to find that I have a greater appreciation and understanding of the wider legal and family construct. So that's very much part of the process and the ongoing training that we carry out. The training supports not only development of the technical appreciation of the divorce process, the soft skills, very much the listening, the understanding, the further questioning, essentially trying to do that in a way that has no pressure on either party and allows them to receive information from a finance professional, but without any firm advice or direction provided.

00:07:23 David Lee, podcast host

Okay, and just before we come back to Debbie, Martin. Debbie mentioned this whole idea of all the parties signing up to be treat each other with respect and dignity is that something that does that characterise this process. Is this something that tends to hold and once people have signed up, do they stick with that?

00:07:46 Martin Donnelly, chartered financial planner at Trinity Bridge

I think it's very clear David that we're in a high-pressure situation and although everyone is signed up to be respectful and to take everyone's point of view into account, there are occasions where fear drives the decision-making process. Or there's worry over the unknown and therefore quite often we have to step back, take time out, reframe the situation, allow people to calm down and then to take steps back forward.

I think everyone would accept that no two divorce situations are the same, and therefore we have to tackle each one on its own merits and how it drives along.

00:08:32 David Lee, podcast host

Okay, great stuff. Thank you.

And coming back to you, Debbie. How would you help clients prepare for collaborative sessions and explain the process to them? Especially, as Martin said, there are, he said, it's a high-pressure situation.

You use the phrase hotspots. When finances are involved, it is challenging. So how do you explain that in a way that they can really kind of hang on to?

00:08:59 Debbie Reekie, legal director at Brodies LLP

I suppose in terms of the process, I would always explain that quite early on so that they know what they're signing up to. And I would also show my client the participation agreement and talk them through that.

The participation agreement is the cornerstone of the collaborative process to actually just talk through all of that and to talk through all of the clauses and that really helps them understand what the process is, how it's going to work.

And one of the main benefits is bringing in financial advisors, bringing in family consultants and I would always be talking to my clients about that really early on too. So that they can understand that we might want to bring in other professionals as the process goes on.

In terms of preparation for the first meeting itself, that first meeting is usually going through the petition of patient agreement again, altogether and getting everyone to sign it before going on to discuss more substantive issues.

Usually, I would work with the solicitor on the other side, and we would have an agreed agenda, which would normally have been approved by both parties too. And we would just start working through that, so they know what's coming because they've seen the agenda and have that oversight.

If there's urgent issues, maybe like childcare arrangements or there's maybe interim financial issues that need to be sorted out, maybe payment of spousal element support or payment of school fees or extracurricular costs and things, we would deal with those things first before we go on to discuss any other issues. In separation cases, we would expect both parties to share vouching of the assets and liabilities in their names. And that isn't always available for the first meeting.

What we would then do is minute that as a homework task and that would be something that would be produced for the next meeting. There are always minutes prepared from the collaborative meeting and those are then shared and drafted and approved by everyone before they're finalised.

And those homework tasks set out what we're going to discuss and what we're going to do at the next meeting.

So, I suppose that helps clients prepare for the next meeting too because they know what they've had to produce, and they then know what's going to be the topic of conversation. And you would expect the information to have been shared in advance so both parties can look at any financial information from their partner or spouse in advance of the next meeting too.

00:11:11 David Lee, podcast host

Okay, and coming to you Martin, this is obviously a collaborative process in many respects. Obviously, the collaboration between the family lawyer and the financial planner in place important.

So, from your perspective, what are the benefits for you from working alongside a family lawyer in a collaborative setting?

00:11:32 Martin Donnelly, chartered financial planner at Trinity Bridge

A big benefit, David, is clearly the framework that has already been set by Debbie and her colleagues. It's fantastic to work with the family team and have that support. And effectively, I'm brought in with an expectation

the clients of what I will deliver and that really helps so that we often already know what the situation is. We know the financial experience of both parties; we know the shared goals and outcomes and therefore at the end of it you can feel you've really helped because you've had a measure of success from the start to the end of the process.

00:12:12 David Lee, podcast host

Okay and similar question to you I guess Debbie, you know what does a financial planner bring to

the collaborative process and how do you know, at what point do you know whether or not they need to be involved?

00:12:27 Debbie Reekie, legal director at Brodies LLP

I think from experience, and I think Martin will probably agree with this, that the earlier you can bring a financial advisor into the process, the better.

Getting them right in at the start means that we're not kind of going down a path that's maybe financially not going to be feasible or achievable and getting the right expert financial advice at the outset. It can save time and money, and it can, I suppose, just set the case up to be a bit more constructive, that everyone's getting the same information to move it forward.

I think there are very few collaborative cases where a financial advisor doesn't add value. Perhaps if the case is very focused on children, then there's less need. But for many couples, they're going from one house to two houses. They're going from a combined income to two separate incomes. And that's a huge financial change and one that needs a lot of thought and careful planning and getting somebody like Martin in really early can be so helpful in that context.

00:13:26 David Lee, podcast host

Okay, thanks very much. And I'd like to ask you both now for maybe some for instances.

Martin, can you give us an example where you've actually seen a collaborative approach really help in terms of avoiding financial conflict or confusion?

00:13:46 Martin Donnelly, chartered financial planner at Trinity Bridge

Yes, David. Essentially, the conflict or confusion arises because one of the party tends to take control of the finances when they're together, and therefore you have a knowledge gap between one of the parties.

And so, by framing the finances in a way that both understand and can understand each of the different assets, incomes, liabilities, the cost of mortgages, the cost of running homes, and then the short, medium, and long-term implications of any action that we would take is where the value is delivered.

And I guess to put that in context, I often find that a lot of mothers are so supportive of their own children's needs that they have a deep-seated requirement to stay in the family home and therefore the school catchment area but are unaware of the costs of doing so or the alternative options in doing so.

So perhaps looking at finance for an alternative home that might still be in the same area or valuing a

pension or one type of pension over another and perhaps forgoing the need for the property for a more balanced long-term financial outcome.

00:15:05 David Lee, podcast host

Okay, and Debbie mentioned earlier on, Martin, about this whole idea of sometimes collaborative practice is best not as well suited when there's a lack of trust or a power imbalance.

Do you think even when those factors start to show themselves, if you have gone down the collaborative route, that the collaborative route itself can be helpful in minimising that because of the different approach?

00:15:33 Martin Donnelly, chartered financial planner at Trinity Bridge

I think it's massively impactful, David, and purely because my involvement is not siding with any one party.

I'm completely neutral I'm paid to be a financial neutral and therefore I would anticipate that I add value and that we do it without compromise on either side I don't take sides and therefore we're presented with an equal chance of success and outcome.

00:16:01 David Lee, podcast host

Okay thank you and coming back to the examples Debbie can you give us an example of where you've seen financial input from Martin or someone else has helped resolve a legal issue more smoothly.

00:16:16 Debbie Reekie, legal director at Brodies LLP

Yeah, I think when I've seen the financial input working really well is, as Martin said, where it gives clients the knowledge to make really informed decisions about their future. And for a lot of people going through separation and divorce, it's financially overwhelming and the uncertainty is so great.

So, having a financial advisor who can run the numbers, Martin can do things like cash flow modelling to show people how much they will need for the future if they have to meet certain bills and outgoings. And that can show them what their future might look like. And that, I think, can be quite empowering for them if they can see what that looks like.

In the collaborative case, parties are in control of their own separation. So, what that means is, as I said before, they don't have to come up with an arrangement that the court might order. They can become quite creative, and they can come up with something that works for them and for their family.

One of the most recent collaborative cases that I had saw a couple coming to an agreement, which they would never have got in court, but it was one which really worked for them and for their two children. And kind of echoing what Martin said, a lot of it was to do with the catchment areas for school. And they wanted, one of them was going to stay in the family home, but they wanted the other one to still be within the same catchment area. And that's because it was really important for them to co-parent their children and for the children to be able to go between their homes. And if one of them were to move out of the catchment area, they thought that might not work, that might not happen. And that was really important for them.

And both of them in the collaborative process made quite considerable concessions to enable that to happen.

But it was absolutely the right thing for them to do for their family and for their children. And I know that anecdotally, my client then helped his ex-wife move into her new home and get her all set up and helped her with the DIY and things. And I think that's probably testament to how well the process worked, that they were able to maintain that relationship and come out of it.

And, you know, it was not easy. It's not an easy process. But at the end of it, they had managed to reach an agreement which really worked, and which let them both move on in quite a good place.

00:18:21 David Lee, podcast host

So, what the collaborative process is doing there, Debbie, is adding the flexibility that going to court wouldn't have. It's giving that flexibility to find different solutions.

00:18:30 Debbie Reekie, legal director at Brodies LLP

Absolutely.

00:18:32 David Lee, podcast host

Yeah. Okay. And so just wrapping up, just get you both to kind of summarise here. I mean, Martin, what more do you wish...you know, families knew about financial planning during a divorce.

And can you summarise in a nutshell what you've said today about why collaborative practice can be so useful in divorce cases?

00:18:57 Martin Donnelly, chartered financial planner at Trinity Bridge

I wish that every person in the UK had a financial planner as a starting point. And leaning from that, clearly being involved in the collaborative process earlier would really be of significant value to helping move the conversation along and aid the understanding. And so, I wish that families knew more about where to get financial advice and perhaps before even the collaborative process.

However, looking solely at the collaborative part, the ability to be able for me to be able to help organise, list, understand, analyse all the income, outgoing financial assets and liabilities to then give an open and honest appraisal of where both parties stand currently and then post-split and then long term. I think that's where, you know, I would love to see financial planners add that value.

00:19:57 David Lee, podcast host

Okay, great stuff.

And finally, Debbie, to you, how would you summarise those benefits of collaborative practice that we've discussed for divorce cases? And, if anyone listening would like to know more about that practice, you know, what can they do?

00:20:13 Debbie Reekie, legal director at Brodies LLP

I think the benefits of the collaborative process are huge. I've mentioned before the parties retain control over their own decision making rather than leaving it to a judge. I think parties are also able to take control for handling the way that they deal with their case, so to deal with their case with integrity.

It enables parents to come up with outcomes which are specific and suitable for them and their children. It gives parties a more respectful and civilised way of resolving their differences. And it can really help protect children from the fallout that would traditionally be associated with court cases and very acrimonious disputes. It enables parties to keep a civil relationship with their spouse or partner.

A previous case I had, the parties in the collaborative process agreed how they were going to tell their children that they had separated and they basically sorted it all out at the collaborative meetings. And they were then able to go to their children and say that this is what's happened, this is what we're going to do, and this is what it means for you. And I'm sure for those children that was a hugely helpful way for their parents to present it all. And had they not gone through the collaborative process and had they not had the financial input and advice, they might not have been able to do that.

If people want to know more, the consensus collaboration website has a huge amount of information about the process and is a good place to start. I am also, and I'm sure Martin is too, really happy to discuss the process with anyone who thinks it might be for them or would just be interested in finding out a bit more.

00:21:48 David Lee, podcast host

Great stuff. Thank you very much indeed to Debbie Reekie and to Martin Donnelly for some terrific and very clear insights today.

And this episode is part of Podcast by Brodies, where some of the country's leading lawyers and special guests share their insights about a range of issues and developments in the law that are having an impact on individuals, organisations and businesses. 

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And for more information and insights, please visit brodies.com.