High-Net-Worth Clients, High-Profile Divorces, and Confidential Matters.
Divorce can be an emotionally and financially challenging process for anyone, but when you are a professional athlete, public figure, or business executive, the stakes are even higher. High-profile divorces often involve more complex financial issues, public and/or media attention, and privacy concerns.
At Ward and Smith, we provide discreet, professional, and tailored legal services for high-profile individuals navigating a divorce in North Carolina.
These individuals include:
- celebrities and influencers
- business owners
- corporate executives
- commercial real estate investors
- public servants
- community leaders or those influential in their community
- elected officials
- athletes
These clients are faced with unique challenges and issues surrounding a need for privacy, media control, and family protection.
What Makes High-Profile Divorces Different?
High-profile divorces come with a unique set of challenges. These can include:
Significant Assets and Complex Finances
High-net-worth individuals often have complex financial portfolios, including businesses, investments, stock options and Restricted Stock Units, and large real estate portfolios. Dividing these assets equitably requires an understanding of the tax consequences and possible restrictions associated with the sale and distribution of each asset.
Privacy and Reputation Management
With media coverage and public scrutiny, or just the curious community, it’s crucial to protect your privacy. We understand the importance of confidentiality and work to keep sensitive information out of the public eye.
Custody and Parenting Plans
In high-profile divorces, custodial arrangements can sometimes become a contentious issue, especially with public facing clients. Our firm is committed to crafting parenting agreements that prioritize the best interests of the children while protecting your family’s privacy.
High-net-worth clients often face challenging employment demands, which may include extensive travel, requiring custom and unique parenting schedules. If your family lives across multiple states or countries, we can help navigate the complexities of international custody issues and ensure that your parenting rights and time with your child are protected.
Spousal Support and Alimony
Determining appropriate spousal support is often more complicated when one or both spouses have substantial income, business holdings, or other assets that may be acquired in exchange for compensation. We understand that high-net-worth individuals have a certain standard of living, and we work to ensure that alimony arrangements are fair, considering both parties’ needs and the lifestyle that was maintained during the marriage. We also assess and take into account future income potential, including the value of businesses, investments, and other financial interests.
Our Services Extend to Non-Married Individuals
Our services for public facing individuals extend beyond traditional family law services for married individuals. We assist our clients with the preparation of settlement agreements, confidentiality agreements, and non-disclosure agreements (NDAs), involving non-married couples finding themselves in various disputes with a romantic partner. Navigating these unique issues requires a strategic approach tailored to safeguard reputations, assets, and businesses.
How can I protect my business through the divorce process?
If a privately held company finds itself at the center of divorce, the company will likely be required to produce voluminous financial records, including (but not limited to) financial statements, banks statements, and tax returns. Additionally, the business will likely be valued by an expert witness, and that valuation could become public information if the case proceeds to trial. This could have disastrous consequences for the company and its business partners.
To learn more about how a non-owning spouse could acquire an interest in a privately held company and how to protect the business, view our article: Marriage, Divorce & the Family Business: Protecting the Family Business from Divorce.
How can I keep my personal and professional matters private throughout the divorce process?
First and foremost, you should know that court filings, as well as facts entered into the court record, become publicly available. In family law cases, this information could include:
- personal and business tax returns
- personal and business bank statements
- asset portfolios
- financial affidavits detailing your income and expenses
- inventory affidavits listing your assets (including business interests, your personal residence, and vacation homes) and the value of each asset.
With North Carolina Courts implementing online e-filing, it is easier than ever for the public to access your personal information, without leaving the house.
There are a few tools we can use to not only protect our clients' assets but also ensure their matters remain confidential and out of the public eye.
Premarital Agreements
Premarital Agreements not only protect your assets and control for the distribution of your property upon separation and divorce, but our premarital agreements often include confidentiality provisions prohibiting the disclosure of the financial assets and net worth of the parties. For these particular clients, your premarital agreement should include a requirement that all disputes arising from the relationship be submitted to arbitration, rather than the Court. Arbitration proceedings are discussed in more detail below.
Postnuptial Agreement
If you are already married, these issues can be resolved in a post-nuptial agreement. Although it is always advisable to deal with these issues before entering into a marriage, when possible, because you cannot force a spouse to enter into a post-nuptial agreement. Any threats or undue influence exerted over your spouse in an attempt to get them to sign a post-nuptial agreement will almost certainly lead to the agreement being invalid.
Settlement Agreements, Confidentiality Agreements, and NDAs
For both married and non-married individuals, disputes revolving around the relationship of parties may be settled by a settlement agreement which includes a provision that personal and financial matters remain private between the parties.
Cohabitation Agreements
Many of our clients live with a partner but choose not to get married and are therefore ineligible for a premarital agreement (which requires the parties to be contemplating marriage and becomes effective only upon marriage). A cohabitation agreement can be an effective tool to set out the terms for joint and separate financial responsibilities and obligations, acquisition, contributions to and division of jointly accumulated property, and move out provisions in the event the relationship ends, etc.
Parenting and Child Support Agreements
For married and non-married individuals, parenting and child support agreements can also be formalized in a private contract. These agreements are appealing for the privacy that is offered not only for the parents, but also for the children at issue in the agreement.
Again, remember that court documents are public records and can be accessed by anyone, including the public, employers, teachers, and your child's classmates. A court order for child custody could contain findings that one parent acted inappropriately, as well as other embarrassing and detailed facts pertaining to the relationship and/or care of the child. This could include any mental health diagnosis, as well as allegations of drug and alcohol abuse.
It is important to note that you can never fully deprive the courts of the ability to hear child custody and child support matters if it is alleged, and the Court determines, that the agreement is not in the best interest of the child or does not adequately provide for the financial needs of the child. Therefore, to truly keep these matters private, parties should consider arbitration to resolve disputes involving the child.
Notably, parents cannot include an arbitration requirement for child custody and child support matters by a premarital agreement. They can, however, agree to arbitration during or after the marriage. We discuss arbitration in more detail below.
All agreements should contain a provision for alternative dispute resolution methods should a dispute arise relating to the terms of the contract or a violation of the contract. As stated above, in certain situations, especially for high profile individuals, the best option is to agree to include an arbitration requirement, rather than proceeding with litigation through our court system.
While your attorney can request that court documents be sealed, this approach is difficult, strongly disfavored by the courts, and is never guaranteed—even for high-profile clients.
Concerns Regarding Media Coverage
Bad media press can have disastrous consequences for clients, their family, and business relationships. Many of our clients are faced with the fear that a spouse or partner will turn to the press with their private matters. This is where a confidentiality provision will come into play.
A confidentiality provision can detail what can and cannot be said to the press. Should an issue arise in the press, the attorneys at Ward and Smith have a network of PR firms to assist in these matters, as well as an experienced litigation team ready to aggressively defend your rights should a breach of the contract occur.
What is arbitration? Why do I want it?
Arbitration is the process of resolving disputes between parties and is conducted before a single arbitrator or a panel of arbitrators who act like a judge. Unless otherwise agreed by the parties, the parties are entitled to present evidence, call witnesses to testify at the hearing, and to cross-examine those witnesses—similar to a court proceeding.
Most importantly for our clients, arbitration is private. The proceeding, documents and evidence, and the fact that a dispute arose at all remains a private matter. The one exception being the divorce filing itself—the legal proceeding to actually become divorced from your spouse will be filed with the court and become public record.
However, North Carolina is a "no fault" state, so the divorce pleadings and decree granting the divorce contain very minimal information and should not allege fault on either party nor cite to the reason for the divorce.
In almost all cases, arbitration results in a faster resolution of the dispute, when compared to the years it could take to resolve a complex matter in court. Arbitrators are privately hired and are usually paid on an hourly basis.
Therefore, arbitration does come with an added cost, but with the time saved and the need for less formalities than a court proceeding, arbitration is usually more economically efficient.
Finally, if your case involves a specialized business or requires specialized expertise, the parties may choose to select an arbitrator with specialized knowledge needed to value and distribute the assets.
Importantly, without a written agreement, you cannot force your spouse or partner to attend arbitration once a dispute arises. This requires some forethought and planning, and a formalized written agreement, before disputes arise.
For typical family law matters, arbitration is governed by the North Carolina Family Law Arbitration Act. If the agreement falls outside the North Carolina Family Law Arbitration Act, then arbitration will be governed by the Revised Uniform Arbitration Act. It should be noted that the parties are free to revise or alter the standard arbitration provision found in the North Carolina statutes.
What is the difference between mediation and arbitration?
Mediation is another private mechanism that may be used as a tool to resolve disputes in an informal and efficient manner.
The important distinction is that mediation is non-binding, so neither party is required to come to an agreement in mediation, and there is no final decision maker. The mediator is not able to make final decisions for the parties, they are just there to facilitate and encourage negotiations. Many of our clients want to attend mediation prior to incurring the expense and time required of arbitration.
Why choose Ward and Smith for high-profile divorce cases?
Every high-profile divorce is unique, and we are here to craft a strategy that works for you. Whether it's protecting your assets, securing a fair custody arrangement around complicated work schedules, or keeping your personal life private, we handle it all with expertise and discretion.
In our representation of high-profile and high-net-worth clients, Ward and Smith family law attorneys are seasoned in both discreet negotiations and aggressive litigation when necessary.
We also work with a network of other professionals, including PR and financial management firms, to complement the services we offer to our clients.
