How to pay for your Divorce Lawyers

Although we advise and represent many high net worth (HNW) people during their divorce, most of our clients are anxious about paying their legal costs, especially if the matter goes to the Family Court. HNW people are often wealthy in assets but short on liquid cash.

The perceived cost of litigation costs often results in people choosing to forgo legal advice and represent themselves in Court. This is a mistake as if your spouse has instructed an experienced divorce lawyer you will be at a significant disadvantage. Furthermore, it is extremely difficult for someone not trained and experienced in family law to successfully navigate the legal system and instruct expert witnesses etc.

There are several options available to cover your legal costs whilst your financial settlement is being agreed upon.

Self-funding

This is where you use your own capital to pay for your legal expenses. If you are in a financially stronger position than your spouse, you may choose to fund their legal costs. This will work to your advantage if it mitigates the risk of your spouse taking out a commercial loan at a high-interest rate, therefore reducing the capital available to be divided in the financial settlement. However, this should not be an open-ended commitment and your spouse should be encouraged to have a backup plan in case you have to withdraw your financial support.

Family and friends

If you receive financial help from a family member or a friend, make sure you ask your Family Law Solicitor how long they believe your divorce case will take to settle. Also, agree that notice will be provided if funding has to cease to ensure you do not continue to run up legal costs without any ability to pay them.

If the money from family and/or friends is in the form of a loan, it is always best to have a legal agreement drawn up. For example, you could agree that you will pay the money (plus any agreed interest) loaned for legal costs back once you receive the funds from your share of the financial settlement. The other reason for documenting the loan is so it can be presented in the Family Court as a debt that needs to be repaid.

Remortgaging your property

If you have enough equity in your family home, you can apply to remortgage your property. The advantage of remortgaging is the interest rate will be lower than that of a personal loan and the loan can carry on after your divorce is concluded.

Personal loan or credit cards

Personal loan or credit cards

Personal loans are available from many financial institutions including high street banks, independent lenders, even Sainsbury’s and Tesco. Your financial circumstances and the value of the loan will determine the interest rate. You will also need to pay an administration fee.

A bank will require confidence that you will receive a substantial financial settlement. To this end, an undertaking from your Solicitor and you that the debt will be paid will be required. Other third-party lenders may require security such as a charge over your property before they lend you any money.

Sears Tooth agreements

A Sears Tooth agreement is a deed that assigns the settlement you receive from your divorce to your Solicitor who will pay themselves in full before handing over the rest of the funds.

The agreement will need to be signed and witnessed after you have received independent legal advice. Furthermore, you will need to tell the Court and your spouse that you have entered into a Sears Tooth agreement.

Sears Tooth Agreements are now very rare as they are inherently risky for Solicitors and generally not necessary given the introduction of litigation loans, as discussed below. They also require the Solicitor to cover any disbursements themselves. However, experienced divorce lawyers who know that their client will receive a high-value settlement may enter into one if it means getting their client’s case over the line.

Litigation funding (also known as a litigation loan)

Litigation funding law

Litigation funding for divorce is essentially where a commercial lender loans you the funds you need to cover your legal costs and disbursements. The loan is repaid from the financial settlement you receive when your divorce is concluded.

Because the lender needs reassurance that they will get their money back, they may secure certain assets against the loan, for example, any property you own or valuable artwork but many do not. The lender will make an assessment of your case (guided by your solicitor) as to the likely outcome and how bug a loan you might need.

Although your divorce lawyer can advise you on how to obtain a commercial loan, you must receive legal advice from an independent Solicitor before you sign the loan agreement.

Court-ordered interim financial provision

If the financially weaker party in a divorce has no income or capital to meet their legal costs, and for whatever reason they cannot obtain a litigation loan, the Court can order the financially stronger party to pay. This ensures both parties can fairly pursue their case. A separate hearing will be held to determine if an interim financial provision is suitable. The Court will consider the following:

  • Is the dependent spouse’s case reasonable and are they taking every opportunity to settle the matter early? An example of this is trying mediation to resolve any disputes rather than insisting on going straight to Court. Any history of domestic abuse within the relationship will mean it is highly unlikely that mediation will be a suitable dispute resolution alternative.
  • Have commercial lenders been approached?

Your Solicitor will advise you on the risks of an interim financial provision application and the steps that must be taken beforehand – court should always be seen as the final resort for legal fees funding.

Final words

Having the finances available to see your divorce case through to the end can result in shorter court proceedings and encourage your spouse to settle early. At Edwards Family Law, we will explore every avenue that suits your financial situation to allow you to receive our specialist, astute divorce law advice.

Edwards Family Law is a niche London-based firm specialising in high-net-worth divorce and international family law. To find out more about divorce and financial settlements, please phone +44 (0)20 3983 1818 or email contact@edwardsfamilylaw.co.uk. All enquiries are treated in the strictest confidence.

Unhappy with your Divorce Lawyers and want to know how to change?

Getting divorced is often quoted as one of the most stressful experiences someone can go through. It is never an easy decision. It is one of the most important financial transactions you will do. It is therefore vital to ensure the team you instruct is the right one for you. Your solicitor should make your divorce easier to deal with rather than a stressful process. We often get asked how easy it is to change solicitors once the process has already begun. the short answer is, it should be easy.

If you want to discuss changing lawyers today, please get in touch.

How to choose a family lawyer?

Divorce and Family Law is becoming more and more complex and it is a highly specialised field. Judges have a wide discretion when deciding what a financial settlement should be and therefore there is not a one size fits all. It is important if you have a complicated divorce that you instruct a solicitor that has experience in dealing with the issues in hand and is up to date with the law on the topic. An example of a complicated case might be those with complex asset structures, company interests to consider, arguments about whether assets are “matrimonial” or not, where there might be international considerations and where there might be pre or post nuptial agreements.

Word of mouth recommendations for family lawyers are sometimes the best way to choose a solicitor. Indeed, at Edwards Family Law a large part of our work comes from referrals and previous clients. If you think your case might be more complicated than a friend’s, those lawyers may not have the experience to deal with your case.

If you are unsure about your current legal team and want to see if we can help, get in touch today.

Why change family solicitors?

family solicitors

Divorce is a very personal thing. It is vital that you have a good relationship with your solicitor, and you feel that you trust them both personally and in the advice they give.

One of the most common issues is when someone feels their lawyer lacks confidence in their advice and cannot think on their feet. If your lawyer always says they need to “get back to you” when you ask them a question, then something is probably wrong. If they do not have confidence in their own ability, it is difficult to see how they can expect you to have confidence in them. You should always be able to voice your concerns without fear of being made to feel stupid or shouted at and with an answer being given quickly.

Unfortunately, the relationship between solicitor and client can often deteriorate to the point of no return. The most common reasons we are approached for include;

  • A concern about overcharging or high fees;
  • lack of confidence in the advice being given;
  • concerns about or lack of strategy in the case and feeling like you have no idea what is going on;
  • A failure to return calls or emails and frequent unavailability to deal with your case;
  • Concerns about lack of progress on the case and missing court deadlines;
  • a lack of trust;
  • not being listened to or heard in any way or that the important facts that they are giving to their solicitors have been overlooked.
  • The solicitor does not know or remember the finer details about the case;

Ultimately if you lose trust or confidence in your solicitor for whatever reason, you should at the very least seek a second opinion. If you want to get a second opinion, please get in touch.

In what circumstances can I change solicitor?

If you have concerns about your solicitor and the advice you are receiving, you should seek a second opinion from a specialist family lawyer. To give that opinion, most lawyers will need some basic background information about your case with a snapshot of the assets. A good lawyer will ask the right questions in that initial phone call but any documents you have should be provided before your initial consultation if you are going to get the most from it.

It may well be that the second opinion is the same as the advice you have already received, and this gives you a new sense of optimism and reassurance that your case is on the right track. If not, or you still feel that the confidence and trust has gone, you can switch to new lawyers completely and immediately.

When should I change?

You are legally allowed to change solicitors at any time. You will have to pay any final bill and our experience tells us to ask for an up to date bill of costs before you confirm you are moving lawyers. Only once your final bill is paid will you be able to have your papers released and so it is important you consider any important dates before deciding to go ahead. If you are thinking of changing solicitors and there are court deadlines looming, we would recommend speaking to other lawyers as soon as possible and if necessary asking your existing lawyers to stop work (especially if you are concerned about the advice you are being given or generally quality of work).

In addition, the timing of when you change might be crucial. If there are hearings coming up you may want to ensure you have changed teams so that the strategy going into that hearing is correct and you have confidence moving forward that nothing has been missed. Even if it is a week before the next hearing, if the new lawyer has the time and wherewithal to read in on your case, they will make it happen. On the other hand, it might be more appropriate for you to stay with your existing legal team until that hearing has taken place.

How long does it take?

Appointing a new solicitor for your divorce or family proceedings is simple and straightforward. Once you have paid your final bill, your old solicitors should release your files to your new solicitors’, and you will need to confirm to your old solicitors that you authorise this. Your old solicitors should get the file ready quickly, but if they are slow or seek to delay matters, your new solicitors can and should be able to move it along.

Your new solicitors will then tell the other side and the court that they are acting for you. It will then be a question of your new solicitors reading into your case and getting to grips with all the detail. The time this will take will depend on how long your case has been going on and how complex the disclosure might be together with what other work your new solicitors have. Your new solicitors should be able to give you a clear indication on this. If they cannot, they are probably not going to be an improvement.

If you want to find out how long it might take for us to take on your case, get in touch today.

Is it going to cost me a lot in fees to change divorce lawyers?

You should always try to get an indication on how long the reading in process will take (both in terms of time and costs). The time this takes will also depend on how the file has been put together. We often find that if a file has been put together badly or is disorganised, it is a good reflection on how the case has been managed. Your new solicitor should then be able to discuss the strategy for your case. If you have a good idea of the amount of papers in your case then this will help us give a clear idea on timing and costs.

Is it too late to change solicitors?

If you have already had a final hearing and final orders have been made it will be too late to re argue your case. In limited circumstances you can appeal, and you should consult another solicitor to determine your chances of success. In addition, depending on the advice you received from your existing solicitor you may have a claim for professional negligence. In any other situation, even leading up to a final hearing, you can change lawyers if you need to.

If you think any of the above issues are relevant to your case, have lost confidence in your existing solicitor or just want a second opinion, please get in touch with us today for a confidential, no obligation consultation. 


© 2023 by Edwards Family Law