For Good Divorce Week, we are highlighting all the ways separating or divorcing couples can resolve disputes away from court, also known as alternative dispute resolution (ADR).
ADR has grown in popularity over recent years, and particularly during the pandemic, as Family Court delays have increased.
Private Financial Dispute Resolution (FDR) can help couples reach an agreement about how to divide finances while avoiding traditional court proceedings, where as a standard FDR forms part of the court process.
How a court-led FDR works
A court-led FDR has three hearings:
The First Directions Appointment, where the judge will decide what information is needed in a particular case. For example, they may order a pension sharing report, or for a property or business to be valued.
The Financial Dispute Resolution hearing. This is a chance for parties to negotiate freely (as nothing can be referred to later), assisted by a judge. The judge will review all the financial information and expert reports, and give an indication of what they would order if they were the judge at the final hearing. It’s worth noting that the judge at this hearing cannot be the judge for the final hearing.
If no agreement is reached at the FDR hearing, the case will be listed for a final hearing, where the judge will make a decision as to how the finances should be divided.
Due to increasing pressure on the court system, that process can take up to 2 years. I was recently at a first hearing, where the judge said the FDR hearing was unlikely to be until May 2023, 6 months later.
Judges often have several cases to deal with each day, and have very little time to prepare for each hearing, and therefore there is a chance that they won’t have considered every detail before giving their indication at the FDR. The indication, if not accurate, can have a negative impact on proceedings, if the party to which it favours relies on it for settlement discussions.
Judicial availability has also been an issue with court proceedings, especially over the pandemic. I’m sure every family solicitor will have at least one story of a case being removed from the court listing the day before, or sometimes the day of, the hearing. If either party has a barrister, they will still be liable to pay for their barrister, even if the hearing doesn’t go ahead, as you become liable for counsel’s fees a week (sometimes more) before the hearing. Removing hearings at such short notice can result in thousands of pounds of wasted legal costs.
How a Private FDR works
Private FDRs have become increasingly popular. They work in the same way as a court-led FDR, but you pay for your judge, who is often an experienced barrister. By paying privately for your judge, you have their attention all day (they won’t have any other hearings that day) and they will have had the time to read all of the papers. Therefore, their indication is likely to be far more reliable. You also get to select the judge and your solicitor can select someone they have experience of and consider to be good.
There are potential cost savings if you choose to have a private FDR, even though you have to pay privately for your judge. If your court FDR is taken out of the list shortly before the hearing, that could result in thousands of wasted legal costs that will need to be replicated when preparing for your relisted date. A private FDR will remove the risk of wasted costs. It can also increase the chance of an agreement being reached, which would then avoid a lot of future legal costs.
Private FDRs are usually held at the barristers chambers of your chosen judge, and therefore you are guaranteed a private room all day, and usually have access to refreshments. Court buildings are usually extremely busy, a private room cannot be guaranteed, and refreshments are sometimes limited. Being in a nicer environment can also be less daunting than attending court, and make you feel more relaxed throughout the day.
Finally, to have a private FDR there doesn’t have to be Court proceedings first. If both people want to reach an agreement and have provided sufficient financial information a private FDR can be arranged without starting Court proceedings at all.
Need some advice? The family team at Hedges Law are offering a limited number of free appointments, as part of Good Divorce Week 2022, both online and at our Wallingford Office. We will provide guidance and information on the splitting of matrimonial assets, including money, businesses, property, pensions and income. If you are interested in one of these appointments call us on 01865 594265 and mention “Good Divorce Week”.