Jun 21

Is it worth paying for a private Financial Dispute Resolution?

Written by Claire Hunter
Associate

DDI: 01423 726620
E: claire.hunter@raworths.co.uk

For most people, (particularly those without children), one of the most important stages of a separation is the financial settlement. When managed badly it can fuel acrimony and dispute, cause bitter fall outs and long, unhappy divorce processes.

To help there is the Financial Dispute Resolution (FDR) appointment, an opportunity for parties to seek the advice of a judge regarding the likely outcome of the case, helping them to try and negotiate an agreement.  This process happens fairly early on in the financial remedies process, once both parties have provided full and frank financial disclosure of their financial position.

The primary purpose of the FDR is to encourage parties to negotiate a settlement that they are satisfied to be fair, rather than having it imposed upon them by a Judge at a final hearing. It is also designed to limit delays, reducing both the emotional and financial strain imposed upon the individuals. However, in recent times the role of the FDR has become less efficient. The courts are overstretched and under resourced with long delays and the time allocated may not be enough to look in detail at the case. It’s also possible the judge might not have the right expertise. As a result there has been a marked increase in people seeking private FDRs.

The concept of the private FDR is the same as a regular FDR and involves asking an experienced Judge (or barrister, solicitor or retired judge) to give you their view on a settlement to help settle the case.

There are many advantages to the private FDR: you can choose an appropriate Judge for the case, you can also control when the FDR happens and how long it takes. Likewise, the location is normally in a solicitor’s office – a much more discreet and comfortable environment than a public waiting room in the Court!

Obviously the negative is that there is a cost to a private FDR, meaning it will be out of bounds to some –  but those who do pursue this option find that by investing in the process they are more motivated to reach a settlement. One could also argue that a private FDR pays for itself – there’s a higher probability of achieving a settlement in a relatively short period of time, which in turn avoids exorbitant legal fees and the chance of the case running to a final hearing.

If you are considering a private FDR but have some questions we can help to guide you confidentially and sensitively. Please feel free to contact us on 01423 566666 or email claire.hunter@raworths.co.uk in our Family, Children and Divorce team.

The benefits of the private FDR

• The choice of Judge – parties can agree on the appropriate Judge for their case.
• Time – the parties choose a day and time for the FDR and it can go on all day if they want.
• The parties are voluntary participants.
• Investment in the process – a private FDR does require the parties to have invested financially in the process but this often means taking it more seriously.
• Location – the day will usually be spent in the comfort of a solicitor’s office where everyone has their own room, documents can easily be typed up and printed off. This is often very different to a public waiting room in the Court.
• Where the parties have reached an agreement in some areas but not others they can direct the Judge to the key areas that are left in dispute.
• Flexibility – in the unfortunate event that a settlement appears to be unlikely the parties may want to ask the Judge to take on the role of a mediator, they will then become more actively involved in trying to broker the deal.
• A big advantage to the Private FDR is that it can replace the Court based FDR so there is no longer a need for clients to attend both.  This of course frees up the Court resources and Court time for those cases which need it.  Private FDRs do have a high settlement rate bearing in mind everyone is invested in the process and want to come out with a resolution.
• A private FDR can offer an ideal balance between having a high probability of achieving settlement in a relatively short period of time and not incurring exorbitant legal fees.
• Sir James Mumby described the private FDR as “A private FDR is a simple concept.  The parties pay for a financial remedy specialist to act as a private FDR Judge.  That person may be a solicitor, barrister or retired judge.  No additional qualification is required.  The private FDR takes place at a time convenient to the parties, usually a solicitor’s office or barrister’s chambers and a full day is normally set aside to maximise the prospects of settlement.  It takes the place of the court FDR”.  Parties who are already in the Court process can opt for a private FDR instead of a Court FDR.  Those who have not started Court proceedings can also agree to attend a private FDR once they have exchanged disclosure on a voluntary basis.

Published on 3 June 2021