Contemplating divorce? You’ll need a trusted, capable team at your back

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The COVID-19 pandemic has taken a severe toll on everyday lives, including relationships. According to legal experts, Canada’s divorce rate has increased as couples have been forced to spend more time together.

For high-net-worth families, separations and divorces involve considerations of unique and complex assets, including business endeavours, as well as concerns about confidentiality, a keen desire to preserve family relationships and cultural traditions, and the need to develop effective succession plans.

Each element of the settlement puzzle requires a focused, collaborative team approach to develop a durable, practical and mutually successful outcome.

Put together a collaborative, trusted-advisor team

A critical starting point is assembling a competent, collaborative team of trusted advisors to guide, teach and advise spouses to explore their needs, wants and dreams.

Taking a detailed inventory of foundational needs and wants from both spouses will often reveal shared interests. Among them might be:

• Future financial security.
• Maintaining private residences and a thriving business.
• Reliable and confidential healthcare.
• The children’s educational needs, career development, social and personal welfare and well-being.

Collaborative negotiations are not for everyone. Collaboration means a commitment to hear and understand what your spouse needs. It means expressing your voice during negotiation without fear of being threatened or disrespected. It includes practicing the guiding principles such as transparency and full disclosure with “open hands” to truly be informed of the financial circumstances of the family.

The focus is on the present and how to balance the family’s future needs and the continued success of the family business without dredging up past transgressions and recycling history. Collaborative advisors actively listen to and consider the interests of each spouse, not their influencers or irrelevant distractions. The couple works together toward a custom, private and durable settlement arrangement finalized in a separation agreement.

Seek trusted advisors

Collaboratively trained lawyers often have relationships that can help you build out a team with similarly focused and experienced requisite neutral jointly retained professionals to advise both spouses with open minds and creative advice. Your team will likely include specialists in tax, valuations, domestic and international matters, and estates and trusts.

To focus on the well-being of all family members, consider the benefits of forming a close circle of care, which may include a neutral, jointly retained facilitator, family and child therapist, grief counsellor or any other necessary advisor the team may recommend.

Monitor privacy and seek reputation management

Privacy is often paramount to high-net-worth (HNW) families, especially those in the public eye, because of their business success and philanthropic endeavours. Private family matters and financial information can be released into the public realm. Getting ahead of the situation may be required by hiring a public relations firm to help manage the situation by minimizing unwanted attention and managing communication.

Identify key individuals

Wealthy families usually depend on a large staff to keep their personal and business affairs in order, which can include housekeepers, family office personnel, property maintenance employees and individuals involved in the family’s business interests. To help identify key individuals and the keepers of information, organize and compile contact information for your collaborative team.

Gather documents

The team will identify the documentation required to determine the ownership and value of the family property at the current date, date of marriage and the agreed-upon separation date. Requisite documents include the last three years of individual and corporate tax returns and notices of assessment, investment statements, debts and liabilities, trust deeds, appraisals and valuations, signed domestic contracts and a detailed list of high-value collectibles and family heirlooms.

Work together

Many HNW spouses are deep-rooted in their communities and actively involved in philanthropic endeavours. Established community networks and social relationships may be at stake during and after separation. To protect social and relationship capital, it is important to maintain positive relationships and find creative ways to work together.

Guard your personal health

Separation and divorce can take a toll on your mental and physical health. To help stay focused and positive, consider stepping away from social media platforms to circumvent inadvertent posting about your personal and family situation and to avoid serialized media reports of celebrity separations.

Your world is not theirs, and your overall health is a valuable resource to be guarded and protected. Daily exercise excursions, learning a new sport, periods of calming meditation and other outside interests can help balance the unexpected highs and lows of the negotiations.

Reconfigure the traditional jigsaw puzzle

We invite you to reimagine putting together a traditional jigsaw puzzle. Instead of assembling all the little pieces to replicate the photo on the box lid, think of each piece as part of a new, unique image. What will your new picture look like?

To learn more about collaborative family negotiations and how to build a durable and mutually satisfying financial settlement, contact Lorisa Stein and Tiffany Harding.

Lorisa Stein MA, JD, FEA is a Family Advocate drawing on 30 years as a family law lawyer and social cultural anthropologist, 20 years as a collaborative professional and five years certified and practicing as an FEA. Lorisa is a board member of the UHN REB, she sits on WLAO Mentoring Committee and has written articles in legal journals, the CMAJ and international collaborative publications. She founded and facilitated a collaborative practice study group, is a frequent speaker and mentor, and has been interviewed by national newspapers. She frequently posts on LinkedIn. Based in Toronto, Lorisa works with clients in Ontario and internationally. Her website is www.LorisaStein.com

Tiffany Harding, CFP, TEP, CLU, FEA, MFA-P, CDFA, FCSI, is a Family Enterprise Advisor and Certified Financial Divorce Analyst designation holder and Vice-President, Head of Wealth Planning at Gluskin Sheff. Since 1984, Gluskin Sheff has served the wealth management needs of Canada’s high-net-worth individuals, families and institutions across Canada and the U.S. Our sophisticated offering integrates our comprehensive wealth planning services with best-in-class private and public investment vehicles to help our clients meet their financial needs. Gluskin Sheff was acquired by Onex in 2019.

This article does not constitute legal, accounting or tax advice. You are responsible for consulting your own tax, estate, legal, family law and/or other professional advisors to assess the suitability of any strategy according to the specific facts and circumstances of your particular situation.