How to avoid an expensive divorce

Following the announcement of the divorce of Amazon Inc. boss Jeff Bezos' and his wife MacKenzie's, there has been lot of speculation about how the roughly $140 billion wealth will be split.

Closer home, divorces in Bollywood and celebrity circles often see big numbers with being talked about like they are petty change. Rising living standards, high expectations and social/family pressure often make warring spouses get aggressive at the divorce table. When the deal is done and the ink dries up, some feel they have been cheated. Some feel they have been robbed. Some feel they have not got enough.

An emotionally draining event like a divorce, especially when kids are involved, is a taxing period for couples who are parting ways. Money matters. But are there ways to avoid a costly divorce? What factors should you keep in mind when you finally go for the money meeting? DNA Money spoke to experts and lawyers to help you avoid a back-breaking divorce.

When a relationship is over, no matter what the reasons, it has a negative effect on the psyche. Marriages may be made in heaven, but they are annulled on earth. The longer the duration of the marriage, greater could be the complication. Divorce is a harsh reality in today's world, which is governed by laws. This ensures that the rule of law is followed. It also guarantees that if somebody goes by the book, they would avoid getting a raw deal.

Maintenance management

When a couple starts divorce proceedings, the wife is entitled to interim maintenance. This is usually considered to be the right of a woman going through a divorce. This is because as the marriage is being dismantled, she needs shelter, and money to survive. Only a fraction of women are working. A large section of women is financially dependent on their husband. They have no independent means for looking after themselves. "There are two parts of maintenance - interim and final. At the interim stage, both parties have to come up with details about their income, and expenses. These are considered by the court," says Meera Sanzgiri, a family court lawyer from Mumbai.

Both the husband and wife are expected to give a true account of their income and expenses. If the husband does not represent a proper picture of his high expenses despite his high income, the decision can be unfavourable. It is the job of both parties to produce proper documents. Women should know how much their husbands earn.

"For the wife also, it is important to present expenses properly. Courts are only going pass orders based on facts presented to them. It is not a discretionary power. In international laws, a certain percentage has to be given and is fixed for the wife. This is still not the case in India," says Sanzgiri.

Usually, there are 11 factors considered by the court awarding interim maintenance. These include status of the parties, reasonable wants of the claimant, the independent income and property of the claimant, the number of persons the non-applicant has to maintain, the amount should aid the applicant to live in a similar lifestyle as he/she enjoyed in the matrimonial home, non-applicant's liabilities if any, and provisions for food, clothing, shelter, education, medical attendance and treatment, etc, of the applicant. Payment capacity of the husband/wife is also very important.

"When it comes to procuring documents, husband and wife cannot obtain each other's documents directly. One is expected to give a list of documents to be produced to the court. So, submitting the correct details and nature of documents one wants to see are important," Sanzgiri advises.

In pursuit of fairness

Alimony is husband's or wife's right for maintenance after divorce. The giver will feel they are giving more, while the taker feels they are taking less. This dilemma always exists. Lawyer Amruta Sathe Pathak feels that being reasonable in demands is very important.

"If it is a long marriage, we have to understand that a wife cannot suddenly restart her career even if she is educated. In such a case, a husband has to make some good provision for her to be able to sustain. I personally think a time period of five to seven years is good for a wife to start something on her own. But if she can't and that is natural, then how long should somebody provide is an area of negotiation and discussion," says Sathe Pathak.

Any payment that goes from either the husband or the wife to each other in terms of maintenance is governed by common sense. A person earning Rs 2 lakh a month may not have the capacity to pay Rs 1 lakh a month alimony, or Rs 12 lakh a year. "Some say we want a few crores. One needs to understand whether the husband has the ability to pay. It depends on the capacity to pay," points out Sathe Pathak.

Often, lack of understanding and entering of ego leads to disagreements. "For example, if the husband has dependants then recurring responsibilities would have to looked after, irrespective of the divorce happening or not," says Sanzgiri.

Another area of disagreement is the child's education. Often one parent wants the best possible education for the child, but the other parent should be able to afford it. It is not her word against his kind of situation. Every child deserves a good education, but someone has to foot the bill. Of course, expenses cannot be manufactured just to show a lower repayment capacity. But divorces often linger on for years. The cost of time for both the husband and the wife can be quite big. That is why many couples enter into a mutual divorce and opt for an out-of-court settlement.

In a mutual divorce the court will not dictate or decide the terms but will only look at whether the settlement has been arrived at by the free will of both parties. This settlement is a result of negotiation. During negotiations the parties can arrive at a decision regarding their assets and wealth. This includes real estate, financial assets, gold, etc.

"Good lawyers will negotiate in presence of both parties. These things should be discussed sitting across the table things and with an open mind," says Sathe Pathak. She also adds that lawyers are always under instruction from the client side. "Lawyers do what the client wants them to. They are not driven by any other motivation," she added.

Often the fear of a divorce stretching for years can force either party to hurry. This is also when mistakes happen. It could happen that either the husband or wife is committed to somebody outside the marriage and is waiting to get the divorce to marry the new partner. In such situations spouses set the stage for manipulation and exploitation. Settlement pacts in this kind of scenarios can be one-sided if both parties have knowledge of what the other partner is up to. That being said, succumbing to frustration and simply the desire to get out of a failed marriage as quickly as possible often drives people to make rash decisions that can also cost a fortune.

GOING SEPARATE WAYS:

• While awarding maintenance the court considers factors such as wants of the claimant, independent income and property of the claimant, the number of persons who are dependant on the non-applicant, etc 
   
• Both husband and wife must give a true account of their income and expenses. If either represents a wrong picture of expenses or income, the decision can be unfavourable 
   
• Husband and wife cannot obtain each other's documents directly. Hence, one is expected to give a list of documents to be produced to the court