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AI and tech hold the key to reforming divorce costs

Lawyer-led process faces increasing competition from innovators

19 April 2017

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‘The reason divorces are so expensive is they’re worth it,’ legendary country musician Willie Nelson said in 2012. Currently on his fourth wife, the 83-year-old 12-time Grammy award winner is no stranger to divorce proceedings, nor the costs involved. However, costs are a significant barrier to divorce for most couples. Technology is increasingly seen as a gamechanger but how far can it upset the traditional apple-cart of lawyer-led advice?

Although three-quarters of law firms now provide fixed fees for uncontested divorces, hourly rates largely still apply for complex asset disputes. Reaching a financial settlement can cost couples £70,000 on average. The Ministry of Justice’s 34 per cent hike in the cost of divorce petitions – up from £410 to £550 – has only added to clients’ woes. Little wonder that increasing numbers face debt to divorce.

Disillusioned with the status quo, Martin Holdsworth, a partner at Yorkshire-based Jones Myers, has founded Resolve Divorce, an online system that he says guarantees a solution to financial disputes without providing legal advice, and without the cost of solicitors’ fees or court proceedings.

The divorcing parties must first enter a binding arbitration agreement and disclose all their financial assets. Once disclosure has occurred, artificial intelligence program NOCTUA provides a predicted settlement award. Each party is then given access to a barrister, who provides independent advice on whether NOCTUA’s prediction is appropriate within ten days. If both agree on a settlement, the matter is concluded and the parties are referred to a third barrister who converts the agreement into a court order. If there is no agreement, a fast track arbitration, mediation, or full arbitration hearing follows.

Resolve Divorce is priced at £2,950 plus VAT per person up to and including the court order. The mediation and arbitration options cost £500 plus VAT. A divorce pack that helps parties draft the petition is supplied at no cost. The petition fee is paid separately. Parties have a 0 per cent finance option over three years for both the service and petition fee.

‘My aim was to get people through for a guaranteed fixed price at their own speed but with a guaranteed conclusion,’ Holdsworth told Solicitors Journal. ‘Costs may come down further in the future but at the moment most lawyers will quote £18,000 for what we can provide for less than £4,000. The model is not aimed at the top end where complex asset structures are involved; it’s aimed at normal people who both work, have a house, some savings, and maybe a bit of debt.’

Holdsworth has received positive feedback from fellow lawyers. Since the soft launch 12 months ago, several mock couples have trialled the process and almost 40 lawyers have signed up to the mediation panel. Beta testing is almost complete. After initial private equity funding, Holdsworth is now looking to crowdfund £400,000 in exchange for a 10 per cent share so Resolve Divorce can be rolled out nationally. He expects the launch will cause some disruption to the legal market.

‘The solution for this significant part of the divorce market is unlikely to come from lawyers alone,’ he says. ‘The answer will be more akin to the Resolve Divorce model, an amalgamation of artificial intelligence, online-based dispute management software, non-lawyer family support services, and, ultimately, the discreet use of expert family lawyers as and when they are needed.’

Holdsworth is not alone. Alan Larkin, a director at Brighton firm Family Law Partners, recently told the journal about Siaro, an online portal that gathers basic client information prior to initial consultation in divorce and separation cases. Larkin hopes to introduce tools that would be able to predict ‘more accurately how long a case is likely to take and how much it’s likely to cost’.

Other lawyers with an eye for tech-infused dispute resolution are Chrissie Lightfoot and Adam Duthie, managing partner at Duthie & Co. Their brainchild, Robot Lawyer LISA (Legal Intelligence Support Assistant), is currently using AI to help two parties collaborate on commercial matters. The new system only offers non-disclosure agreements (NDAs) but Lightfoot and Duthie plan to roll out other tools, including for divorce-related matters, in the future.

‘With a basic level of legal guidance and support an AI tool can help negate two sets of costs and time, particularly in the early stages of an issue,’ Lightfoot told Solicitors Journal. ‘As proven by LISA and the NDA tool, such AI platforms, tools, and services may help to reduce the overall fees in legal matters, particularly when they are offered for free, saving two sets of costs and two sets of time involved.’

Elsewhere, Kate Daly, a family consultant, and tech entrepreneur Pip Wilson are proving that non-lawyers can disrupt the family law market with the creation of amicable, a free app that helps couples collect and share essential divorce information. The app enables couples to complete their financial disclosure and parenting plan for free before paying a fixed fee to finalise the divorce. It also partners with a law firm to write consent orders and process the paperwork.

New technologies are reshaping the way the legal sector works. While some tech advancements still seem more science fiction or dystopian future than modern practice, the failure of traditional firms to recognise innovation from their legal and non-legal competitors alike could see them divorced from what is fast becoming a marketplace reality.

Matthew Rogers is a reporter at Solicitors Journal

matthew.rogers@solicitorsjournal.co.uk | @lex_progress

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Technology Divorce