Informed Decision Making

{3:00 minutes to read} As I mentioned in my prior post, The Initial Consultation, I meet with all of my prospective clients before I begin the mediation. During this first meeting, one of the things I tell them is that I require full financial disclosure. I don’t allow them to waive this requirement, even if they say that they’ve “got everything worked out and don’t need to make financial disclosure.”

Part of the reason I do this is to make sure each of them is fully aware of what is available for discussion. Most importantly, I want to satisfy myself that each of them is making an informed decision.

This also serves to protect the final agreement. One of the easiest ways to have an agreement vacated is to show fraud, which requires one party to demonstrate that the other party kept facts from them. Facts that would have made a difference in what was agreed to.

When a couple retains me to help them with a legal separation or divorce, one of the first things I do is provide each of them with a financial disclosure form. This form is to be completed prior to the first mediation session and contains a place to record all required information about their assets and liabilities.

I also require that they bring certain back-up documentation to the first session. This includes:

• Tax returns;
• Pay stubs;
• W-2s; and
• Pension/retirement account statements.

During that first session, I spend time reviewing their financial information and documentation. I go through it all with the two of them, to be sure each has, and understands, all the financial information needed to make informed decisions.

By doing this, I can be assured that each party is aware of the financial implications of their decisions. For example, if one of them wants to waive an interest in a pension, I am fine with that, provided they understand what they are doing and the long-term implications of that decision.

The bottom line is that if a couple is not fully informed of their choices, and the consequences of their decisions, they will not be happy with their agreement in the future. The only way to minimize the chance that either of them will feel the agreement is not workable is to educate them both before it is concluded.