Divorce is challenging for any couple, but the complexities multiply exponentially when significant wealth is involved. High-net-worth divorces present unique challenges that extend far beyond the complexities of traditional divorce proceedings. Involving substantial assets, complex financial structures, and often high-profile individuals, these cases demand specialized legal expertise and a comprehensive approach.

This blog delves into the intricacies of high-net-worth divorce in Alberta, offering insights into the legal landscape of such cases, potential challenges posed by high-net-worth divorces, and strategies for achieving a favourable outcome.

Unique Challenges of High-Net-Worth Divorces

Divorces with large amounts of money, investments and property at stake require careful handling to ensure an optimal outcome. High net worth divorces are characterized by several distinct complexities, such as:

• Complex Asset Division: The process of identifying, valuing, and dividing a vast array of assets, including businesses, real estate (local and international), investments, and intellectual property, often requires specialized knowledge to understand such intricate financial arrangements. Uncovering hidden assets in such cases can be complex and may require diligent investigation.
• Business Valuations: Determining the value of businesses and other income-generating assets often involves complex financial analysis and expert evidence. However, disputes over asset valuation may result in extensive litigation.
• Tax Implications: Large financial transactions during a divorce can have profound tax consequences, so careful planning is essential to minimize tax burdens.
• Child and Spousal Support: Complex financial arrangements can impact a party’s child support and/or spousal support obligations. Calculating the appropriate amount of spousal support to award in high-net-worth cases requires a nuanced understanding of income, assets, and living standards during the marriage. Moreover, issues about children can become particularly contentious in high-net-worth divorces.
• Privacy Concerns: High-net-worth individuals often want to protect their privacy, which can be tricky to balance with the transparency required in divorce proceedings.
• Domestic Agreement Disputes: While parties in high-net-worth marriages commonly enter into cohabitation agreements and marriage contracts, disputes may arise during the divorce process over the validity and interpretation of such agreements.
• Legal Expenses and Other Costs: High net-worth divorces often result in high legal costs incurred by the parties due to the need for specialized assistance and the potential for prolonged litigation. As such, parties may consider participating in alternative dispute resolution methods such as mediation.

The Importance of Financial Disclosure in High Net Worth Divorces

When the parties to a divorce possess substantial wealth, the process can become more complex. In these cases, the parties must cooperate with the legal process and provide full and frank financial disclosure to the other party. This requirement ensures that each party is transparent about their financial situation and allows the parties to make informed decisions on the path to resolution. While the exact financial disclosure that must be provided can vary depending on the circumstances of each case, generally, there are key documents and information that must be exchanged, including:

• Income tax returns and Notices of Assessment;
• Income statements and pay stubs;
• Investment portfolios;
• Bank account and credit card statements;
• Business interests; and
• Real estate holdings.

The requirement to provide full financial disclosure extends beyond an initial exchange of information, as ongoing and updated financial disclosure is typically exchanged between the parties throughout the litigation process. In cases where child support is payable, financial disclosure will generally be required until the child is no longer considered a child of the marriage.

If a party fails to provide such disclosure, this can impact settlement negotiations between the parties and they may be subject to serious consequences by the court, such as unequal division of family property, increased support payments, and increased legal fees.

Legal Strategies for Managing High Net Worth Divorces

Navigating a high-net-worth divorce requires careful planning, skilled legal counsel, and a comprehensive understanding of the complex financial and legal landscape. By working with experienced professionals and adopting a proactive approach, individuals can increase their chances of achieving a fair and equitable settlement while protecting their financial future.

Family lawyers dealing with high-net-worth divorce cases work with their clients to understand their needs and develop tailored strategies to address complex financial and legal issues.

Lawyers often work with a team of qualified professionals and experts, such as appraisers and forensic accountants, to ensure that all assets and liabilities are fairly identified. They will also help their clients maintain privacy by providing guidance on alternative dispute resolution methods and engaging in the process. Family lawyers managing high-net-worth divorces will strongly advocate for their clients’ financial security while negotiating settlements outside of court that preserve their client’s lifestyles and safeguard their assets.

Contact Getz Collins and Associates for Skilled Representation in Divorce Proceedings in Calgary and Strathmore

The experienced separation and divorce lawyers at Getz Collins and Associates regularly work with clients to resolve various issues resulting from the marriage breakdown. When a case involves high-net-worth individuals, issues such as child support matters, property division and spousal support claims can become highly contentious. As such, our family law team guides clients through each stage of the divorce process and ensures that all assets and liabilities are located, valued, and divided accordingly. We will explain your options and will provide comprehensive legal advice to ensure that you make the best decisions for you and your family moving forward.

From our offices in Calgary and Strathmore, Getz Collins and Associates works with clients in local communities and across Alberta. To schedule a confidential consultation with one of our family lawyers to discuss your divorce case, contact us by phone at (587) 391-5600 or reach out to us online.