At Law: Divorce Court New York Style
By Walter Olson
City Journal, Spring 1993
In the old days, it was so hard to get a legal divorce in New York that unhappy couples had to collude to set up grounds for it. Courts would not dissolve a marriage without proof of misconduct, preferably of a documentary sort. So companies "sprang up that supplied a hotel room, a phony partner, a private detective, and a photographer," as Glenda Riley recalls in Divorce: An American Tradition. Such absurdities became a staple of popular novels of the period and turned up in at least one Astaire-Rogers musical.
Today, as we all know, New York and the rest of the country has swung to the opposite extreme, once represented by Nevada alone: Either spouse can unilaterally divorce the other, for any reason or none. Many thought that, whatever the drawbacks of this regime, the legal process would at least burn up less money than it did when "fault" had to be proven every time.
But it hasn't worked out that way, at least in New York City, judging from a remarkable study issued last year by the city's Department of Consumer Affairs. The study reports that a couple in a "typical" contested divorce face combined legal fees of an astounding $50,000 -- an enormous burden for all but the wealthiest families.
The biggest culprit, the report says, is New York's vague equitable distribution law, passed in 1980. It broadened judges' discretion to consider a great range of factors in splitting up a divorcing couple’s property. That gives the two sides plenty of handles to litigate. "The vast amount of money that can be made because of this new law has become an inside joke among lawyers," notes the report. "Court Referee Steve Liebman said a divorce that would have cost $6,000 in total fees for both sides before 1980 now runs ‘easily' $50,000."
"Most lawyers will prefer to leave no stone unturned, provided, of course, they can charge by the stone," Deborah Rhode of Stanford Law School has commented. "Tracing" assets requires elaborate inquiries into bank and business records. Both sides can call in forensic accountants, value-of-a-professional-degree appraisers, and other pricey expert witnesses, along with child psychologists and social workers to help with the equally vague new legal standard on child custody ("best interests of the child" -- as if anyone could agree on what that meant). As this area of the law has become "hot", big law firms have launched divorce departments; some play marital splits like any other high-stakes litigation.
The opportunities for misconduct by unscrupulous lawyers seem to have multiplied with the stakes. "In matrimonial law," Manhattan divorce lawyer Howard Benjamin told Consumer Affairs, "you know exactly how much money your side has and exactly how much your opponent's side has and in the hands of less than an honest lawyer, that's very damaging information."
Opponents get abused in virtually every area of litigation. This one, much more than most, is also beset by the financial exploitation of vulnerable clients. Some lawyers wait until the eve of a major court date, then demand huge sums of money to proceed. Clients who try to switch lawyers may find they cannot get back their personal papers, even those as vital as passports -- which are kept for security of payment, under a "retaining lien". (New York lawyers, it seems, are particularly fond of this kind of lien and have helped block national guidelines that would rule it improper.)
Other attorneys charge a big retainer up front and pocket it even if they wind up doing little or no work on the case, a practice struck down in January by a state appellate court as unethical (the case is likely to be appealed). Some defend nonrefundable fees on the grounds that an attorney deserves money for passing up the opportunity to be hired by the other side. One lawyer's retainer agreement reportedly characterized the nonrefundable charge as a "penalty fee" for reconciling with the spouse.
A few lawyers have wound up holding whole portfolios of mortgages on their clients' houses; one, the report says, "has been known to run out of his office an independently organized collection agency -- specifically to collect on his own accounts."
Long Island lawyer Willard H. Da Silva, writing in the professional journal Family Advocate, recommends a fee that is neither be payable in installments nor refundable. "If the client cannot afford the retainer, he or she can borrow from parents or relatives, sell a piece of jewelry or securities, refinance a car, or obtain a personal bank loan."
As for abuse directed against the opposing side, no brief survey could do that topic justice. In divorce law it ranges from "freeze and starve" tactics against dependent spouses, to blackmail threats to divide a breadwinner's ongoing business in ways that will destroy it. It is common to use unnecessary motions and procedural demands to impose costs on the other side.
Here, of course, the bar has a good comeback: It's very often the client who goes shopping for the "bomber" and insists on the most aggressive policy. Still, Richard Crouch, who used to chair the ethics committee of the American Bar Association's Family Law Section, has argued that it's time to write rules that would help lawyers resist. The abuses against opponents, he says, have "grown close to intolerable."
Though there is some wish for reform within the divorce bar, many of its members, including lawyers of high ethical standards (yes, there are a lot of those, too) were annoyed to hear criticism from the outside, especially from Consumer Affairs -- were they then to be regulated as a business like any other? Yet in a sense, it’s no surprise to see Consumer Affairs taking an interest: For many families, divorce turns out to be the most expensive “product” they ever buy. What's more, the customer dissatisfaction rate is undeniably high. Back in the early 1980s, sociologist Terry Arendell interviewed sixty California mothers for her book Mothers and Divorce and found 53 "had strong complaints" about the lawyers they had hired. Of the seven who did not, three had prepared and filed their own divorce papers without lawyers' help, three had worked out agreements with their husbands before hiring lawyers to draw up the papers, and one was a law student herself who got a professor to serve as her attorney.
Nor is the bar policing itself. Consumer Affairs Commissioner Mark Green, like Crouch and nearly everyone else, is of the opinion that the lawyer disciplinary system offers little help to aggrieved clients. In 1990 there were 2,550 complaints against the lawyers of Brooklyn, Queens, and Staten Island, of which a mere 26 led to public sanctions. Those figures are for lawyers in general, not divorce lawyers; the American Bar Association estimates that about 100 family-law lawyers get sanctioned a year nationwide.
In New York, an energetic group of women have set up a grassroots group called the Coalition for Family Justice to press the case for divorce reform. As Crouch points out, the bar has a stake in beating outsiders to the punch: "shoddy conduct, going unpunished, tends to bring the whole divorce bar in disrepute." There's the public interest to consider as well. We keep hearing of law as the great protector of poor people; if so, it would seem about time that it stopped making so many of them.
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Walter Olson is a senior fellow at the Manhattan Institute and author of The Litigation Explosion.
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