Today, the President of the Family Division, Mr Justice Mostyn, has released guidance for family lawyers dealing with the financial cases ancillary to divorce proceedings. This guidance is provided in order to assist regular Court users during this difficult time and to minimise the volume of people gathering at Court buildings.

One suggestion is for Financial Dispute Resolution (FDR) hearings to be held in private at barristers’ chambers or solicitors’ offices.

The traditional FDR is the second Court appointment in Financial Remedy Proceedings ancillary to divorce.

The FDR is a compulsory Court appointment for the parties to seek advice from the Judge, as to what he or she believes a fair and appropriate settlement would be in the circumstances of the case.

The FDR hearing takes place once both parties have provided each other with full and frank financial disclosure, have had the opportunity to raise questions in respect of each other’s disclosure and any appropriate experts have completed their reports. For example, an actuary who was instructed to prepare a report in respect of pension sharing. In theory, by the time the FDR Hearing has been listed, both parties should know what the matrimonial pot consists of and what is available to be divided between them.

The principal of the FDR is an excellent idea. It allows both parties to feel like they have engaged in the settlement process and have obtained a settlement that they each deem to be fair.

This is in contrast to the procedure that would occur should the case not settle at the FDR stage and proceed to a Final Hearing. The Final Hearing is firstly expensive, both parties will have to endure the trauma of cross-examination and ultimately have a settlement imposed on them by a Judge whose background may not be in family law or matrimonial finances.

An alternative to the above is the “Private FDR”. In 2018, Sir James Mumby released further guidance on the Financial Remedy Court. Within this guidance there was a section dedicated to private FDR’s, which stated:

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 in solicitors’ offices or barristers’ chambers, and a full day is normally set aside to maximise the prospects of settlement. It takes the place of the in-court FDR.

If the parties’ financial circumstances allow, there can be many benefits to engaging in a private FDR:

• The parties have the ability to essentially choose their Judge. The particular circumstances of the case may require the instruction of a Judge who has experience of specific niche areas of law such as complex pension arrangements or cases that involve international assets.
• The date, time, location and length of the appointment is decided by the parties.
• The Judge will have had time to read all the essential paperwork which isn’t always the case when, during the regular FDR process, the Judge will have multiple hearings in their list.
• The fact that the parties are directly paying for the private FDR Judge’s time may lead them to take the matter more seriously and fully engage with attempts to reach a settlement on the day.

Whether or not Private FDR’s become as popular in the North as they are in the London courts remains to be seen. There will be critics who will say that the use of Private FDR’s would not be necessary if the Court system was properly funded and Judges not overwhelmed with work, and that the rise of private FDR is a step towards the privatisation of the Justice System.

The current environment which we are experiencing is, however, completely unique, and measures like the use of Private FDR’s may be the only way in which financial hearings take place, the alternative being that the hearings are adjourned which will inevitably lead to an even greater backlog within the Court system.