1. Hiring Inexperienced Counsel
Many doctors have friends who are lawyers or have business counsel for their practice and/or healthcare facility. Often times doctors will hire these lawyers to handle their divorce as they are convenient and may promise to get things done quickly because divorces are “easy” compared to healthcare lawsuits. Divorces, however, are not always easy, and hiring counsel without specific experience in family law can hurt the doctor going through the process. Divorce lawyers in Texas know the ins and outs of what it means to negotiate in a community property state as well as the characterization and valuation of a physician’s practice and/or interest in practice. Doctors should seek the counsel of an experienced divorce lawyer who is Board Certified in Family Law by the Texas Board of Legal Specialization to ensure their assets and family are protected.
2. Not Disclosing All Information
Doctors often fail to disclose all the “bad stuff” upfront with their counsel when starting the divorce process. Just like patients who may try to hide key information that would help with an accurate diagnosis, doctors must disclose everything to their counsel, including any damaging personal or business-related information. This could include the existence of an affair, funds spent on a paramour, financial issues with the practice, as well as addiction or drug and alcohol abuse. When a divorce lawyer is aware of all potentially damaging information, they can form a plan to neutralize it. Doctors must be completely candid with their family law attorneys to achieve the best possible divorce outcome.
3. Forgetting a Confidentiality Agreement
Doctors often forget to include a confidentiality agreement covering the divorce process that would protect their patient list and other proprietary information related to their medical practice. If this information is obtained by an outside party, it may be used to damage the doctor and/or their practice. Confidentiality agreements can limit the disclosure of this confidential information, only allowing their counsel and approved parties to know the details of their business. It is especially important to have a confidentiality agreement in place when having the doctor’s practice valued by an expert hired by the doctor’s future ex-spouse.
4. Having an Inaccurate Valuation of their Medical Practice
The value of a doctor’s medical practice is one of the most highly contested and controversial parts of their divorce. Many doctors have very emotional connections to their practices, especially if they built them from the ground up. Over or understating the value of a medical practice can have serious consequences in divorce court. Doctors must trust the valuation experts their divorce counsel hires to ensure the value of the practice is accurately calculated. Doctors may also not be aware that goodwill is considered when calculating the value of a practice. Doctors must work closely with a valuation expert to distinguish between personal goodwill and commercial goodwill.
5. Assuming Equal Division of Marital Property
Many doctors quickly assume that when the divorce process starts, all assets will be divided right down the middle. In Texas, community property is divided in a way the courts deem just and fair, making sure to take into consideration each party, any children involved, and the expenses related to the family. One spouse may be awarded a disproportionate share of the community property because of a variety of reasons that will be considered by the court. These may include expected inheritances, the estate value each spouse gets, who has custody of the children, attorneys’ fees to be paid, etc. Doctors must be ready to split their marital property according to what the court deems fair.
6. Disregarding Deadlines
Doctors are used to the fast-paced medical environment but may not realize that the divorce process can be hectic too. There are many deadlines that must be met and meetings with divorce counsel that must be attended. During discovery, divorce counsel must respond to requests by certain deadlines, which means that even with a busy schedule, doctors must respond to their counsel in a timely manner. For the divorce process to go smoothly, doctors need to be ready to provide documentation, pertinent information, and more quickly. Doctors should actively be involved in this process even when their work and patients come first.
7. Not Using Experts
Doctors may not know they will need outside experts to advise on their divorce. They may need a valuation expert to appropriately value their practice, a certified public accountant to help with the division of community property, and even therapists that may help all members of the family handle the divorce. Doctors and their divorce counsel should sit down and create a list of potential experts that may be needed throughout the process. Retaining these experts earlier instead of later will help keep the divorce on track.
8. Not Being an Active Parent
Doctors may not always have time to be active caregivers for their children at home because of their busy schedules. Sometimes doctors are on-call and have to leave to go to the hospital in the middle of the night. When a divorce is finalized, the doctor’s ex-spouse may find themselves in a position where they need outside childcare and may need to plan for daycare, babysitters, a nanny, and more. Ignoring the needs of their children is one of the biggest mistakes a doctor can make in a divorce.