26 October 2018

Financial disputes in divorce: Can a 'private' FDR save the time and expense of a Court battle?


Vanessa Mitchell
Associate | UK

In family law, what is Financial Dispute Resolution (FDR)?

Starting financial proceedings in England and Wales puts in place a court timetable. Parties may resolve their case amicably at any time, but absent agreement, there will be at least 3 court hearings parties have to attend. The second of those hearings is a ‘financial dispute resolution appointment’ *FDR for short).

An FDR is akin to judicial mediation. Parties (and their advisers) attend Court having set out in advance their proposals for settlement. The Judge is then asked what they would order if they were the Judge dealing with the case at trial. The idea is to give parties the opportunity to hear directly from the court what they would do, but the Judge cannot force the parties to agree. Instead, the spouses are given the opportunity to then settle the case, knowing that if they fail to do so, they will most likely have to incur the costs of an expensive trial some months (or possibly years) ahead.

Is this a new approach?

Private FDR’s have been on the rise in the last few years. The concept is the same as in a Court-based FDR – you ask an experienced Judge (or retired Judge, or senior barrister) to give you their ‘sneak preview’ in the hope it helps settle the case – the circumstances in which it takes place are a far cry from what often takes place at the family Court.

The process and its advantages

The most significant advantage is that the parties decide between them which ‘Judge’ should be tasked with their case. Knowing that they have had a direct involvement in the choice of Judge, and that the Judge will be there on the day and will have read all the materials, inspires confidence in what they say. The parties are voluntary participants in a process which they can control. They will also know that their chosen ‘Judge’ will have experience in dealing with the particular issues relevant to their case.

The private FDR does require the parties to have invested financially in the process: the ‘Judge’ will charge a fee, but for that fee he or she will spend, if necessary, a full day with the parties, on a date of their choice, and in a location of their choice. The day will usually be spent in the comfort of solicitors’ offices, where everyone has their own room, documents can easily be typed up and printed off, and where parties can freely discuss proposals for settlement without fear of being overheard (such as in the public waiting rooms in most Courts). The parties can also decide on the agenda for the day, and can decide what aspects of the case require more time and attention.

In the unfortunate event a settlement appears to be far off, the parties may want to ask the ‘Judge’ to take on the role of mediator, and they will then become more actively involved in trying to broker the deal. There is flexibility that the parties cannot otherwise achieve in the Court-based FDR.

A word of warning if you choose not to go the ‘private’ route…

In theory FDRs are a great idea and many cases do settle at or around the FDR stage, but increasingly the experience is disappointing for clients. An overstretched Court system means many Judges are having to juggle a number of FDRs at any one time. It’s unrealistic to expect judges to understand such a variety of different facts from different cases and give clear guidance on each issue. For very unfortunate clients, there may simply be no Judge allocated to the case at all on the day, and they have to come back another time (and further expense).

Many clients come away feeling disappointed and weary. They may feel they have lost their best (and only) opportunity to try to resolve the case, but are not be prepared to follow the Judge’s indication because they felt their concerns were not properly addressed, the Judge was too much in favour of the ‘other side’, and they hope for ‘better luck next time’.

Private FDRs are a real attractive alternative to Court in the appropriate case and are certainly an option to consider to achieve a swift solution or at the very least an indication of a likely outcome at trial. As always, our advice is to think through your options and approach very carefully.

Vanessa Mitchell Associate | London

Category: Article