Kitchen Table Agreements and Mediation – Cost-Effective Resolution Options

Written by Allison R. McAlpine

In resolving a family law separation matter outside of Court, there are typically three stages:

1. Financial Disclosure – spouses and lawyers exchange financial disclosure including income tax returns and notices of assessment, and proof of assets and debts on date of marriage and date of separation;
2. Negotiation of Basic Terms – spouses and lawyers go back and forth on the various issues (e.g., custody, access, child support, spousal support, equalization/property division) trying to negotiate a final settlement of those issues; and
3. Drafting the Agreement- lawyers draft the final comprehensive separation agreement. There can be some back and forth with this before it is signed. Note: once there is a separation agreement signed, either typically then files for a divorce and/or CPP credit splitting.

Using a lawyer for all of these steps can be expensive. There are two resolution options available to spouses to limit these costs:

1. Kitchen-Table Agreement – the spouses exchange financial disclosure and agree on the basic terms themselves. The spouses then provide these terms and the financial disclosure to their respective lawyers. Each lawyer provides his/her client with independent legal advice on the disclosure and terms agreed to. There may be some further negotiation after this advice is given. One of the lawyers then prepares a separation agreement incorporating the terms agreed to.
2. Mediation – the spouses jointly hire a mediator to help them resolve the basic terms of their matter. A mediator typically costs less than a lawyer, and the parties split the cost of the service. The mediator is a trained neutral professional who helps the parties come to an agreement on the basic terms. In a fair mediation, financial disclosure is provided and exchanged during the mediation process. If the parties agree on terms, a mediation report is prepared by the mediator outlining those terms. Each party brings the report to his/her lawyer to obtain independent legal advice on and to have the terms put into a comprehensive separation agreement.   Please note that a mediation report is not a valid and binding agreement. A proper Separation Agreement must be prepared.

In both of these resolution options, the lawyer is taken out of the financial disclosure and negotiation process and typically engaged to provide independent legal advice and draft the final separation agreement. This saves the spouses significant costs in legal fees.

Warning: some spouses take the lawyers out of the process altogether and prepare an agreement themselves and sign it. This is not a good idea for a few reasons:

1. The Agreement, if challenged by one of the parties, will likely be overturned by the court. Allegations of duress or undue influence can be alleged, terms may be ambiguous or improper, financial disclosure may not have been exchanged, and proper releases may not be included, among other things; and
2. The spouses, without independent legal advice, will not know their rights and obligations, meaning that any agreement that they sign without such advice could be to their detriment. Independent legal advice allows a spouse to be confident that they are receiving a fair deal.