What is a MOU aka Memorandum of Understanding
There are several distinctions between a separation agreement and an MOU.
A memorandum of understanding (MOU) is a kind of like a no-frills, bare-bones promise, a letter of intent at best, while a separation agreement is a binding contract.
An MOU is created to chronicle the agreements arrived at by both partners during the mediation process.
MOUs are most useful in several American states, where the family law system has been reformed.
You may ask what is meant by MOU aka Memorandum of Understanding and what role does it play in a settlement. So what is a memorandum?
A memorandum of understanding is a non-binding term sheet arrangement between the two parties that speaks to the parties’ intent, aka terms and conditions of an understanding, a starting point of mutually accepted expectations.
Is a Memorandum of Understanding legally binding – Not Always.
Why Have a Memorandum of Understanding?
By tradition, an MOU is the work product created by the mediator to chronicle the agreements arrived at by both partners during the mediation process. However, an MOU by itself is mostly not enforceable or binding. It keeps the lawyers in the loop to bill a few thousand dollars to create the formal contract aka Separation Agreement. Unfortunately, too many lawyers use this as an opportunity to insert a wedge of conflict. This is their way of dialling up the billing. The lawyers use words like “unlawful practice of law” to keep the mediators in their place and put fear into the clients’ minds. Fear is the fuel of the divorce industry. Real Estate Agents write legal agreements all the time when they draft agreements of purchase and sale.
What is MOU - May Not Be Worthwhile
There are several distinctions between a separation agreement and an MOU. An MOU is kind of like a no-frills, bare-bones promise, a letter of intent at best, while a separation agreement is a binding contract.
People often believe these two documents are one and the same, but they are in fact different, and mistaking them could be disastrous. Read the remainder of this article to learn the distinction between an MOU and a separation agreement.
What is MOU – What’s the Difference?
This table addresses the distinctions between memorandum of agreement (MOU) vs contract aka a separation agreement:
Compare | Separation Agreement | Non-binding MoU |
---|---|---|
Definition | An agreement is a document by which parties commit to working together to reach a common goal. | An MOU describes the terms of an agreement without being legally binding or involving the transfer of finances. |
Traits | It grants substantial rights to the parties. | There should be a clear mention of another agreement that will be drawn, up at a later stage |
Enforceable in a court of law? | You can legally enforce this document in a court of law. | This document cannot be legally enforced in a court of law. |
Binding? | Yes, always. | Only if the MOU is signed with the intention of exchanging monies. |
The devil is always in the details aka the final written agreement.
Get to the separation agreement aka formal contract to address the details.
Comprehensive Settlement
A comprehensive settlement usually covers the terms of a parenting plan, child support and a marital financial settlement, and this process demands the parties involved put in many hours of good faith negotiations. Terms include the equalization of a couple’s financial obligations, debts and assets, and addressing travel necessities, job schedules, and housing arrangements for kids. This can be an overwhelming period for both parties. It is the divorce mediator’s duty to instill a fair process for both parties during mediation. Mediations can take weeks or months to finalize based on how complicated the case is. So after all this effort, why not just draft a mutually beneficial separation agreement and skip the whole MOU minutia?
Here Is the Rub – Traditional Mediation in Ontario
After reaching an agreement, the mediator drafts the couple’s agreement terms into an MOU. The MOU is then sent off to lawyers to be re-drafted into a separation agreement. I could be the Stephen King of memorandum writing, only to have a lawyer who was not present in the mediation—who has no feel or understanding of the context of the entire settlement—take your MOU in a different direction for their self-serving motivations, injecting conflict where there was none.
Converting an MOU into a Separation Agreement
A separation agreement accompanied by a Certificate of Independent Legal Advice (CILA) is set in stone legally when each party signs it. A CILA is like a lawyer’s affidavit that indicates he or she has checked in with you. It confirms that you clearly understand what your separation agreement means for your future.
Where a Memorandum of Understanding MOU has value
MOUs are most useful in several American states, where the family law system has been reformed. For example, in Colorado an MOU is typically authored by a non-lawyer mediator. The MOU becomes binding when the couple files the MOU with the family court as a mutual consent divorce.
Sadly, this is not the practice in Canada, as our family law procedures are 25 years behind the times and are in desperate need of reform.
For every dilemma there are many possible solutions, and there is a growing number of mediators drafting some fantastic future-forced separation agreements.
Knowing what your mediator produces for work product is important to know when choosing a divorce mediator. You need to know what you are getting for your money.
Here Is the Rub – Traditional Mediation in Ontario
After reaching an agreement, the mediator drafts the couple’s agreement terms into an MOU. The MOU is then sent off to lawyers to be re-drafted into a separation agreement. I could be the Stephen King of memorandum writing, only to have a lawyer who was not present in the mediation—who has no feel or understanding of the context of the entire settlement—take your MOU in a different direction for their self-serving motivations, injecting conflict where there was none.
Converting an MOU into a Separation Agreement
A separation agreement accompanied by a Certificate of Independent Legal Advice (CILA) is set in stone legally when each party signs it. A CILA is like a lawyer’s affidavit that indicates he or she has checked in with you. It confirms that you clearly understand what your separation agreement means for your future.
Where a Memorandum of Understanding MOU has value
MOUs are most useful in several American states, where the family law system has been reformed. For example, in Colorado an MOU is typically authored by a non-lawyer mediator. The MOU becomes binding when the couple files the MOU with the family court as a mutual consent divorce.
Sadly, this is not the practice in Canada, as our family law procedures are 25 years behind the times and are in desperate need of reform.
For every dilemma there are many possible solutions, and there is a growing number of mediators drafting some fantastic future-forced separation agreements.
Knowing what your mediator produces for work product is important to know when choosing a divorce mediator. You need to know what you are getting for your money.
Divorce Memorandum of Understanding Template
The Master Agreement for Separation & Divorce, Second Edition is a drafting guide that will save you days of drafting and improve your work product. The Master Agreement is not state/province law specific, but issue-driven and applicable to all jurisdictions. The Master Agreement is designed to be used both by lawyers for your formal agreements as well as by non-lawyer mediators for your memoranda of understanding – aka an MOU template in MS Word.
Link to mediate.com The Master Agreement
Final Thoughts
Navigating the divorce process can be a daunting task, filled with legal jargon and emotionally charged decisions. However, with the help of a skilled family mediator, spouses can reach a mutual divorce agreement that respects the family dynamic and the needs of any children involved.
A comprehensive separation agreement, which is a legally binding document, can cover important aspects such as child custody, visitation rights, property division, and spousal support. It’s crucial to remember that this agreement should withstand judicial scrutiny and be enforceable under the Family Law Act.
To ensure the validity of the separation agreement, both parties should receive independent legal advice. This step ensures that each spouse understands the same terms of the agreement and its implications. It’s also a safeguard to ensure that the agreement can withstand judicial scrutiny should disputes arise in the future.
Financial disclosure is a critical part of the divorce process. Both parties must fully disclose their assets and liabilities to ensure a fair division of property. This transparency helps set clear expectations and can prevent future disputes.
In cases of domestic violence or other circumstances that may affect the safety or wellbeing of a person, the mediation session may not be the best route. In such cases, legal intervention may be necessary.
The divorce decree, which is the final settlement in a divorce case, is issued by a judge. It’s important to note that the person responsible for complying with the terms of the agreement is the party who signed it. Failure to comply can lead to legal consequences.
Divorce mediation can save the parties time and money compared to traditional litigation. It’s a process where the parties agree on the terms of their divorce, with the help of a mediator. The mediator helps the parties communicate and negotiate to reach a mutually agreed upon settlement.
In conclusion, divorce is more than just the end of a marriage. It’s a complex legal process that involves numerous important aspects. With the right guidance and a valid separation agreement, it’s possible to navigate this process with dignity and respect for all parties involved. Remember, the goal is not just to get a divorce, but to do so in a way that respects the needs and rights of all parties, especially children.
At DTSW:
We understand that you didn’t arrive at this page by accident. You’re likely facing one of the most challenging periods of your life, navigating the complexities of a divorce. It’s a journey filled with questions, uncertainties, and concerns about the future. We want you to know that you’re not alone.
At Divorce The Smart Way (DTSW), we’re more than just a team of Family Mediators and Certified Divorce Financial Analysts. We’re a group of compassionate professionals who understand the emotional and financial toll that divorce can take. We’ve dedicated our careers to helping individuals like you navigate this difficult process with dignity, respect, and a clear vision for the future.
Our Soft Landing Divorce Settlement Method is designed to help you transition smoothly into your new life. This approach focuses on crafting clear and straightforward separation agreements, sidestepping the excessive conflicts, confusion, and costs often associated with traditional divorce proceedings. We believe in empowering you to make informed decisions that protect your interests and those of your family.
We’re here to guide you every step of the way, from understanding the important aspects of separation agreements to ensuring your financial security post-divorce. Our goal is to help you turn this challenging period into an opportunity for growth and new beginnings.
We invite you to take the first step towards a softer landing. Reach out to us and let’s discuss how we can assist you in navigating your divorce the smart way. Schedule a Get Acquainted Call with us today. We’re here to help, and we’re ready to listen.
Articles that may interest You!
Skip the MOU and get to the Separation Agreement!
I help outcome-focused separating couples create separation agreements with clarity and soft landings for secure futures in 6 steps or less without lawyer created overwhelming conflicts, confusion and costs.
Ken Maynard CDFA, Acc.FM
I assist intelligent and successful couples in crafting rapid, custom separation agreements that pave the way for a smooth transition towards a secure future. This efficient process is achieved in about four meetings, effectively sidestepping the excessive conflicts, confusion, and costs commonly linked to legal proceedings. Clients have the flexibility to collaborate with me either via video conference or in-person through a DTSW associate at any of our six Greater Toronto mediation centers, located in Aurora, Barrie, North York, Vaughan, Mississauga, and Scarborough.
Have a few questions - Tap here to Schedule a Get Acquainted Call
-
Ken Maynard CDFA, Acc.FMhttps://divorcethesmartway.ca/author/wardman/May 23, 2023
-
Ken Maynard CDFA, Acc.FMhttps://divorcethesmartway.ca/author/wardman/June 2, 2022
-
Ken Maynard CDFA, Acc.FMhttps://divorcethesmartway.ca/author/wardman/May 20, 2022