Discovery and Experts in the Current Financial Environment

 Last week I spoke at a seminar for family lawyers on the topic of discovery and experts in the current economic environment. As we wade through this financial crisis, the cost of a divorce, or other family litigation is yet another area in which we must look carefully at how we allocate our clients’ limited resources. 

The discovery phase of litigation is one in which a client can help his or her lawyer to effectively allocate limited resources simply by being organized and making sure that the attorney gets needed information early on in the process. For example, in every divorce, past bank statements and credit card bills will be requested. Financial institutions are charging significant fees in order to process requests for documents. On the other hand, an account holder can most often obtain statements as well as cancelled check images dating back eighteen months or longer. The simple act of asking your clients to obtain these statements early on can decrease costs. Similarly, if any records can be obtained electronically, this can save on copying costs (and save a few trees along the way).

 

Early and succinct communication with adversaries and experts are also a necessity. Often, litigants each jump to retain their own experts at the start of a case. Certainly, this is very often necessary. However, there are often cases in which a joint expert can perform the work. In some cases, where there is a significant valuation issue, it may make sense to have a joint expert perform the empirical work, and each litigant can hire their own expert to analyze the data.

Custody disputes are another area in which litigants often spend unnecessary amounts of fees. Sometimes, custody evaluations costing in the tens of thousands of dollars are conducted out of anger at the other party more than a bona fide concern about custody. In some counties in New Jersey, Custody Neutral Assessments (CNA’s) are being utilized. These are assessments by a licensed psychologist who has been appointed by the Court to spend four hours with the parties and if appropriate, the children, and provide the litigants with impressions about the custody/parenting time aspects of the case. In many instances, the litigants will read the impressions, get a sense of where the case is going and then will be able to resolve the case.

 

This is not an exhaustive list, but merely some thoughts on how an attorney can work with the client and be sensitive to the financial realities that we are experiencing. An open conversation with your attorney as well as a willingness to explore some innovative methods of obtaining information can, in many cases, relieve some of the pressure.

Be Careful With Those E-mails to your Lawyer!

When I have an initial interview with a client, one of the common questions that comes up is, “how should I get in touch with you?” Because I am at times up and working early in the morning, or out of the office in court during the day and catching up at night, a common response is, “e-mail.” As we continue to move into the age of technology; when our President has a Blackberry, e-mail is increasingly supplementing phone calls as a way for me to communicate with clients.

Yet there are a couple of important things that have to be considered when communicating electronically with a lawyer. I had previously discussed some of these issues in a previous blog. For instance, it is important to remember that AOL, and other non-web based e-mail servers may place copies of your sent and received e-mails directly onto your hard drive. Therefore, any person in the household who has access to your computer also may also have access to that you may have believed were confidential communications to your attorney. Thus, I always suggest that client’s use a web-based e-mail such as yahoo, gmail or hotmail.

 

Another issue that comes up is the fact that many clients utilize their work computers and e-mail address to communicate with their legal counsel. A unreported non-matrimonial case was recently decided, Stengart v. Loving Care Agency, in which an employee had used her company issued laptop to e-mail her lawyer. Even though she utilized her web-based e-mail address, a temporary file was still stored on the hard drive. Thus, the court found that the employee had waived the attorney client privilege when she used the company’s hardware. Important in that case was the fact that the employee handbook specifically provided that e-mail messages were part of the company’s business records. Also in this particular case, the employee had used the company lap top to communicate with her lawyer about the terms of her resignation from the company.

 

Notwithstanding the particular facts of this case, it is surely the tip of the iceberg floating our way. This is an area of the law in which the technology is moving faster than we can respond. It is imperative that you know what files will be stored on the hard drive of the computer that you are using when conveying information to your lawyer. The lesson to be learned here is that when you have critical confidential information to get to your lawyer, pick up the phone and give me a call.

COURT RULES ON UNAUTHORIZED DISCOVERY

In a recently published Superior Court opinion, a Monmouth county judge found that unauthorized discovery in a post judgment matter is inadmissible and against the rules of discovery in a matrimonial matter.  In the matter of Welch v. Welch, the defendant filed a post judgment application for a change of custody of the parties' minor child.  His application was based upon his concerns for the plaintiff/mother's mental well being and hence ability to properly care for the parties' child.  Two days prior to filing his motion seeking a change in custody, defendant's attorney issued a Subpoena Duces Tecum and Ad Testificandum upon the Marlboro Township police department.  This subpoena requested copies of all documentation pertaining to incidents related to the plaintiff as well as requesting the appearance of an officer on the return date of the motion to possibly give testimony.  Plaintiff's counsel filed a motion to prohibit the release of these documents, alleging the request was made in violation of the Court Rules and also sought sanctions against defendant and his attorney as well as counsel fees.

Ultimately, the court refused to consider any of the documents turned over by the police department asserting that the documents had been obtained in violation of court rules.  The court also assessed counsel fees against the defendant but did not issue sanctions.

The court based its reasoning, in part, upon the notion that discovery is limited in post judgment applications.  The court found that without the scheduling of a plenary hearing or any further proceedings, defendant's subpoena was unnecessary, harassing and impermissible.  The court went on to state that "post-judgment matrimonial motions are summary in nature and are resolved with little or no discovery." 

What is troubling about this trial court decision is the fact that in contested post judgment custody matters, how can a court ignore the admissibility of relevant evidence? Does that not contradict the court's main objective, which is the child's best interest? What about the court's parens patriae duty to protect children?

The decision appears to be inconsistent with the  the Appellate Division's 2002 holding in Tartaglia v. Paine Webber, Inc., which held that illegally obtained evidence in a civil matter  was admissible (though a party could be sanctioned for illegally obtaining it).  On a final note, police records are public records.  Is the court's finding in Welch punitive, insomuch as defendant was assessed counsel fees for issuing a subpoena for the release of what is public record.

It should be noted that the finding in Welch pertains only to post judgment matters.  Discovery in pre-trial matrimonial cases remains broad (See R. 5:5-1).  It would not be surprising if this case is appealed. 

 

All Cases Have a Life of Their Own

Inevitably, at every consultation I have, a prospective client asks me two questions, near and dear to them, which seem like easy questions - or so they thought.  The questions are (1) how long with this take and (2) how much will it cost.

I am certain that the answer, "it depends" is seldom satisfying.  In fact, several years ago, the Court instituted what is called Best Practices in family cases, partially in response to these two issues. 

As to the first question, the easy answer is that pursuant to Best Practices, the Court wants each case resolved within 365 days.  That, however, is not the end of the story.  Many factors go in to how long a case with take.  In some cases, people actually settle before a Complaint for Divorce is even filed and the parties can be divorced in a few weeks.  However, if a trial is actually required, 365 days is unlikely, especially in counties that lack judicial resources. 

In other cases, a party can make their best offer, they can even offer the other side's best case scenario on day one, and the case wont settle for weeks or months.  Why is that.?  Because all cases have a life of their own.  While it is easy for the lawyer to tell our clients to treat the financial issues as a business decision, the reality is that client's often find that to be easier said than done.  Rather, because this is a dissolution of a marriage for some, the breaking apart of a family for others, the death of hopes and dreams for yet others, or worse, it is difficult to remove the emotion from the process.  Why doesn't someone take a great deal on day one - they are often just not ready emotionally to move on.  While the system creates deadlines and there are legitimate means that one can use to try to move the matter forward, sometimes, you just have to wait a little for the emotions to subside.

In other cases, you may not settle quickly because you just don't have enough information.  In those cases, you may not know whether it is a great deal or not.  Some cases will settle quicker than others if both parties act reasonably, try to put aside (if not forget) the emotions, treat each other with respect, and more importantly, want to settle (i.e. be willing to make compromises).Of course, the statistics show that 99% of the cases settle.  Moreover, it is a rare day when a client doesn't say to me that they want to settle amicably.  More often than not, at least at first, amicably is measured on their terms only, without regard at that time for the concept of what might be fair and equitable to the other party   An often heard axiom is that you know a settlement is a fair one if both people walk away a little unhappy. 

Other factors that can delay a case is a party's refusal to cooperate with discovery or Court Orders.  Sometime, opposing counsel is a factor in delaying the case, either because he or she is not responsive, or perhaps for some other improper motive.

For the same reason that cases can take longer than others, they can also cost more than others.  I have been involved in cases with parties having substantial income(s) and assets which have settled quickly and inexpensively.  How does that happen - the parties acted in good faith and were motivated to settle.  I have been involved in other cases where the parties incomes were modest, yet despite all possible efforts to convey reasonableness, they insisted on behaving badly and/or litigating such that the legal fees were quite large. 

The bottom line is that the length of the case and cost of the case are often dependent upon the conduct, emotions and reasonableness of the parties.