Divorce settlements are the result of a marital dissolution when a couple is able to come to an agreement on important matters without the case having to go to trial. The vast majority of divorces end up being settled before trial. Trial can be stressful, time consuming, and expensive. The legal fees that come along with trial alone are enough for most couples to have an incentive to settle rather than go to trial. However, in some cases it may be impossible for the parties to settle.
Since the divorce settlement is an agreement between the parties, once it is finalized there is no appeal. This may be an incentive for parties to try to reach a settlement because if there is a trial, the “losing” party may appeal. If appeals are ongoing it will take much longer for the divorce to be finalized, and the former couple may be living with a lot of uncertainty in the meantime. While appeals are not permitted after a settlement, if there is a significant change in circumstances you may be able to modify your agreement. For example, if one party is paying the other $100 a month in child support, but then gets a high paying job soon after the divorce is finalized, the ex-spouse may be able to ask for the judge to increase the amount of child support that they pay.
There are typically a few areas in which the parties must reach an agreement before a divorce case can settle. One of the major areas is the division of assets and debt. If the parties cannot come to an agreement about how to divide the assets, the court will step in. Most states are equitable division states, but some states are community property states. In community property states, any property acquired during the marriage (with some exceptions), will be split 50/50 in the divorce. In an equitable property state, assets will be divided “equitably.” Equitable does not necessarily mean equal, though in many cases it will likely end up coming close to being an even split. In an equitable division state, the court may consider each spouse’s debts, income, income potential, any misuse of marital property, and potentially fault. However, as noted above, there are several important exceptions, and a skilled divorce lawyer can help you to understand what a reasonable settlement may be in your position.
In order to completely settle the divorce, the parties must also come to an agreement about any ongoing spousal maintenance, also called alimony. Since women have become part of the workforce in higher proportions than in the past, the court is less likely to order indefinite alimony. That means that a reasonable settlement may be less likely to include perpetual spousal maintenance. However, part of the appeal of reaching a settlement is that the soon-to-be ex-spouses can come to whatever decisions they both agree to in almost all cases.
If there are children of the marriage, in order to settle, the parties need to come to an agreement about child support and custody, sometimes called parenting time. Every state has some sort of guidelines that help to determine how much child support is owed. However, sometimes high earning couples and families in other situations may be outside of the guidelines’ provisions. Nonetheless, the guidelines can help the parties to understand the amount of child support a judge is likely to order if the case does not settle.
Parents also need to come up with a parenting plan as part of the divorce settlement. A parenting plan will lay out when the children are with each parent. It can also allocate decision making power between the parents about important matters such as the children’s school, religion, and healthcare. Typically a court will approve any settlement arrangement that the parties agree to, but they may deny a proposed parenting plan if they find it is not in the best interests of the child.
