To achieve a successful outcome in divorce – whether through negotiation, motion practice, or trial – a divorce lawyer must carefully focus on financial details. Bank account records, credit card statements, pay stubs, 1099 forms, income tax returns, retirement records, account summaries, canceled checks, and other financial information and materials must be thoroughly examined and understood.
At my law firm, financial records are subjected to multiple layers of analysis. In the initial instance, financial records are scanned, organized and reviewed by a junior associate. Then, I personally review the records. Although a review of financial records is tedious, its importance cannot be understated. Without identifying, gathering, reviewing and analyzing all financial documents, it is not possible to formulate an effective divorce strategy – let alone achieve success through negotiations or litigation.
Typically, I also get a forensic accountant involved at an early stage. I have working relationships with several forensic accountants with experience in matrimonial matters. I select a forensic consultant based on a variety of factors, including cost. Just like divorce lawyers, forensic experts charge different rates based on their experience. It is important to get a forensic account as early as possible for guidance in developing legal theories and formulating a strategy.
I rely on forensic accountants to identify what documents and/or information has been intentionally omitted from the other side’s discovery responses or Statement of Net Worth. We follow the trail of financial records, with the goal of piecing together the financial puzzle. This strategy of thorough financial review has led to important victories for my clients. The following are just a few examples:
• Earlier this year, I represented a mother in a child support proceeding in which the husband claimed to have no income. At trial, I called the husband as an “adverse witness”, and I questioned him, at length, about his daily living expenses. Based on the husband’s admissions regarding his daily living expenses and financial records, the Family Court imputed income to the father and issued a generous child support award to my client. After trial, the husband filed objections to the child support award. In a written decision, the Court held that imputing income based on expenses was appropriate under New York child support law.
• Recently, our firm has helped a wife succeed in the most difficult of divorce situations: proving that her spouse was lying to the Court and that the husband was actually an owner of a garment business of which he (falsely) claimed to be merely an employee. By issuing subpoenas to the husband’s colleagues and associates, we found the missing pieces of the puzzle. Faced with the smoking gun that we uncovered, the husband dropped his charade, and we obtained a favorable settlement for our client.
• In a widely reported case, H.A. v. H.A., 2008 N.Y. Misc. LEXIS 4573, N.Y.L.J. 14, we obtained a victory for our client by establishing, at trial, that his wife concealed valuable assets from the Court. Our effective use at trial of the wife’s deceptive conduct is vividly reflected in the Court’s decision: “Plaintiff-wife testified that she is not sure how many retirement accounts she had at the time of divorce. She stated she has no remembrance of anything. She also was not sure as to what bank accounts she had. She was unable to recall what her financial condition was at the time of commencement of the action.” In a resounding victory for our client, the court ruled that the wife was not entitled to any interest in accounts that were titled in our client’s name.
The lesson for divorce lawyers and litigants is clear: the key to success in divorce is focusing on financial details. The financial history of the parties during the marriage must be fully reconstructed and analyzed. This strategy has led to my biggest successes in divorce matters over the past 20 years.