Save articles for later
Add articles to your saved list and come back to them any time.
After one free session with a family lawyer, Zoe Cooper knew she did not want – and could not afford – legal advice as she and her husband separated.
“When they told me the cost, $4500 to sign off on the agreements we’d made ourselves … it was just too much,” says Cooper, a teacher and mother of two.
Zoe Cooper and her husband decided to do their own financial settlement negotiation to save on the cost of lawyers.Credit: Chris Hopkins
“We didn’t have a lot to fight over, and we don’t have an enormous amount of assets. It didn’t feel like it was worth putting money we didn’t have into fighting over a small pool of assets.”
The pair, who had been married 13 years, negotiated a deal that means Zoe and the children will keep living in the first home the couple bought recently, with a small amount of equity, and she will pay the mortgage.
As her relationship with her ex-husband is amicable, she believes the agreement will be honoured, with or without legal formalisation, and that putting her faith in the arrangement is better than risking large legal fees.
“People tell you their horror stories, ‘We got a lawyer, and then I got nothing’. That sort of scared me off,” she said.
Cooper, who feels she fully understands the legal issues, is among the increasing number of Australians choosing self-managed settlements over legal and financial advice as cost-of-living pressures rise.
They are the “missing middle” who do not qualify for legal aid, but don’t have the savings to cover commercial legal costs, as the level at which people qualify for government-funded legal help fails to keep pace with the cost of living.
Divorce platform The Separation Guide, which connects separating couples with legal and financial advice designed to keep them out of court, has found a big shift away from paid legal advice in an analysis of its client data. This could leave women, in particular, at risk of financial insecurity.
“The family justice system in Australia has faced concerns regarding its high cost, lengthy procedures, and adversarial behaviour,” the social enterprise group states in its 2023 State of Separation report.
“Certain behaviours by some within the legal profession have affected its reputation, leading some individuals to avoid legal services due to concerns about fee exploitation and conflicts initiated by lawyers against their clients’ wishes.”
The data – collected from the guide’s 228,000 website users; 16,319 separation Q&As from prospective clients in 2021-22; and a 2023 survey of 568 – found a large percentage of couples (46.6 per cent) tried a do-it-yourself approach first, rather than paid legal advice.
It showed a jump in separated couples staying under the same roof due to cost-of-living pressures and a rise in acrimonious divorces. Separation inquiries had risen in tandem with interest rate rises.
More people – the majority of whom are women – are borrowing to fund divorce-related legal advice, and one-third of respondents (33.2 per cent) said they had settled without any paid advice.
Psychologist Leanne Kanzler says she regrets not getting advice when she divorced, as it has left her worse off financially.Credit: James Brickwood
This was alarming, said The Separation Guide co-founder Angela Harbinson, because only 7 per cent of those clients were suitable for an entire DIY approach, even though women reported being far less comfortable with the financial side of settlement, and Australian research has shown they are worse off than men in the early years after separation.
Suitable couples had “a good idea of fairness under family law, a level of amicability that allows them to have difficult conversations without the help of professionals, and a full view of all the assets and liabilities that should be included in their marital asset pool”.
Claudia Fatone, chief executive of Women’s Legal Service Victoria, said the service had also noted an increase in demand for support from the “missing middle”.
It defines this as “women who need legal help but do not meet the eligibility requirements for our service or Victoria Legal Aid and are unable to afford a private lawyer”.
They don’t have the cash to pay private firms … we’re trying to catch some of that cohort but lots of them are falling through the cracks.
Jack O’Donnell, co-founder of the family law finance provider JustFund, said women are currently three times more likely to borrow money to fund their divorce process than men, and many do not know their legal rights.
Sydney psychologist Leanne Kanzler said she had no idea of her legal rights when she divorced, and rather than risk conflict she opted for a fast settlement using the same solicitor as her former husband, risking a conflict of interest.
“I really had no idea what my rights were … I didn’t understand the importance of getting a financial audit done of everything we had,” says Kanzler, who feels she could have been far more financially secure had she done so.
“It all seemed way too expensive and scary … I admit now, it was the biggest mistake. He thrived in those first couple of years and I struggled.
“It had a massive impact; I was constantly thinking I’d ripped myself off, I was constantly crying because the rates would come in or the electricity, or I could see that I couldn’t afford to take the kids on a little holiday.”
Women’s Legal Service acting legal director Lisa Fowler said women with earnings of more than roughly $1200 a week, equity in the family home worth $500,000 or more, and who have been in a relationship for seven-plus years did not qualify for legal aid, and were among those who regularly asked for, but could not get support.
“We see it all the time,” she said. “Eligibility is so tight, it catches people at poverty [level]; we’ve tried to increase the bucket a bit as often these women are primary caregivers and not working a lot, have rent to pay but don’t meet the asset requirement.”
“They don’t have the cash to put in trust up front to pay private firms … we’re trying to catch some of that cohort but lots of them are falling through the cracks.”
A government-funded Small Property Pilot allowing women with small claims to receive legal help demonstrated how women are better off when they get advice, but funding had been capped at 20 cases per month, which did not meet the high demand.
The Morning Edition newsletter is our guide to the day’s most important and interesting stories, analysis and insights. Sign up here.
Most Viewed in National
From our partners
Source: Read Full Article
