Don’t spend too much time beating on a wall, hoping it will transform into a door”
Dr. Laura Schlessinger
We are delighted to present our Issue 14 of HNW Divorce Magazine, with articles diving into Alternative Dispute Resolution in the divorce process. Our experts in mediation and arbitration will explore the options when faced with a difficult separation and will provide you with their legal advice in achieving the best possible outcome.
We would like to thank our community partners and contributors for sharing their perspective on settling differences and reaching an agreement in divorce proceedings.
Chris Leese Founder/Chief Commercial Officer 020 3398 8554
email Chris
Maddi Briggs Strategic Partnership Senior Manager 020 3398 8545
email Maddi
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Bosley, Schneider
60-SECONDS WITH:
FIONA NEWBOROUGH INVESTMENT MANAGER
RBC BREWIN DOLPHIN
Imagine you no longer have to work. How would you spend your weekdays?
I’ve always loved taking photographs from an early age (red camera - tenth birthday!) so I’d like to do a photography course. I would also do a masters in psychology and then spend plenty more time outdoors - when the weather is being kind, I really enjoy paddleboarding or anything to do with lakes and the sea.
What do you see as the most important thing about your job?
Helping people and building trust. The financial world is a complex one and can feel daunting at the best of times; we are often talking to people at junctures in their lives where they might feel vulnerable, so it’s really important that we are here to guide them in the calmest way possible.
What motivates you most about your work?
Lots of things motivate me really but, linked to the above, I enjoy working with my clients to help them to achieve their goals. Seeing the relationship build over the years and becoming their trusted adviser also gives me great pleasure, and I get immense satisfaction from lifting a weight off clients’ shoulders.
What has been the best piece of advice you have been given in your career?
When I first started out in my career, my father, a private client solicitor, told me to stick to the basics of making my clients feel valued and looked after, and that the rest would follow. He was right. He also told me that no good will ever come from cutting corners.
What is the most significant trend in your practice today?
I would say that there are a combination of trends affecting our business at the moment. A key trend is that clients now expect digital convenience as a minimum. There is also an increase in demand for advice across different platforms. As a business, we are responding to this through broadening our advice and services, as well as implementing a digitally enabled client journey. The other exciting area in which we have seen huge growth is the ESG arena (Environmental, Social and Governance) - sustainable investing in essence.
Who has been your biggest role model in the industry?
I’ve had the good fortune to work with many inspirational people over the years, so I wouldn’t say there is one standout individual. My first ever manager at Close Brothers had a big influence on me and the many brilliant people I work with daily at RBC Brewin Dolphin continue to inspire me.
What is one important skill that you think everyone should have?
I recognise that it’s not always going to be possible for everyone to have all skills; fortunately, we’re all wired differently, but on some level, I think communication skills rank highly on the list. Whether they are verbal, non-verbal, written or otherwise, I think communication is always key.
What cause are you passionate about?
On a professional level, I’m passionate about breaking down the barriers when it comes to accessing financial advice and financial education. I think it’s so important that young adults are equipped to cope with the financial world from the outset. When it comes to charitable causes, I’m hugely supportive of the work that the charity Mind does to support those struggling with their mental health.
Where has been your favorite holiday destination and why?
Almost impossible to pick one; I’ve been fortunate to visit a few countries over the years but, as a family, the place we have tended to revisit is Kefalonia in the Ionian Islands. It’s stunningly beautiful with amazing food and very much ticks the box in terms of getting out on water as it’s a small island.
What book do you recommend for everyone to read and why?
Bonfire of the Vanities - it contains so much but essentially, it’s a fascinating glimpse into 1980s New York.
Dead or alive, which famous person would you most like to have dinner with, and why?
Michelle Obama - I’ve read her books and think she’s a complete inspiration.
BREAKING THE MOULD
ADR IN DIVORCE PROCEEDINGS
Authored by: Cady
The Harvard Study of Adult Development began in 1938 and set out to understand human health by investigating something radical for the time: not what made people sick, but what made them thrive. The study, the longest of its kind ever done, has followed two generations of individuals from the same families for more than eighty years. The participants have been asked questions about their experiences and also taken part in various tests. The findings are set out in detail in the excellent book The Good Life (written by the current co-directors of the study) but the headline is this: Good relationships – of all kinds – keep us healthier and happier.
and
This insight is at the heart of ADR in family law. A marriage or partnership might be coming to an end but that doesn’t mean that the couple will no longer have any sort of relationship and it certainly does not mean that relationships with children need to suffer. Even in less amicable separations, adopting an out-of-court approach can allow people to rely on the expertise of those who can offer them support through a difficult time and manage the financial and practical arrangements arising out of their separation in a respectful way.
A value-driven approach
Mediation and collaborative practice both involve clients setting out an anchor statement of what is important to them at the start of the process. These statements usually evidence a desire for children to feel safe and loved; to achieve the greatest possible financial security for all; and to ensure a fair outcome is achieved in a respectful way.
Bringing the parties back to these statements throughout the process
ensures that both mediation and collaborative practice are centred around relationships. If there are children, there is a strong focus on the relationships of parents with their children and their co-parenting relationships with one another. If they do not have children, these approaches try to promote their ability to communicate effectively with one another and their lawyers. This improves their chances of achieving a settlement outside of a costly court process and also of future civility with one another.
If relationships are at the core of a person’s health and happiness then it may be more beneficial than we think if clients don’t have to dread, for example, the separation process or future interactions with people from their shared past.
Pearce (Senior Associate)
Connie Atkinson (Partner) - Kingsley Napley
A shape of your own
A colleague of ours recently flagged that we frequently talk about “squaring the circle”: trying to find a solution, when the parts do not easily fit together, is fundamental to what we do and finding the right process and timetable for clients is part of this. Everyone is different and the kind of value-driven approach outlined above is simply not realistic for some people, something we need to be open and honest about. That does not mean that court is the only option. It should be possible in most cases to reach some agreement on timing and process and only default to a traditional court process if that is not possible.
Court hearings cannot easily be scheduled around children’s exams, flights, business cycles or personal events and this inflexibility can be particularly difficult for international families or couples where one or both parties have high-profile, demanding jobs. Agreeing a timetable and forum that works for both parties, and any children, means that they are more likely to be able to approach any settlement meeting, private FDR or arbitration hearing in the best possible frame of mind.
Using the right process for a particular client is also fundamental when setting the scene for a successful resolution.
If a client feels they need a third-party view before they can negotiate beyond a written proposal, insisting upon mediation is unlikely to be as effective as a private FDR. By contrast, if a client is terrified of attending any form of hearing, a round table meeting may be preferable.
Privacy also needs to be considered, particularly for high profile, HNW and UHNW families. There are benefits for all families in resolving matters without attending a final hearing where the judgment is published but this is particularly so for individuals who already attract press attention. Some out-of-court ADR may mirror court proceedings closely but the advantages, in privacy terms, of an arbitration over a final hearing can be considerable.
Communication
Sometimes what people need to move forward is to be able to look back first: to feel heard and acknowledged. All
ADR approaches allow more scope for this kind of non-legal priority to be addressed than a traditional court approach does.
It is also possible for clients, particularly in mediation or a collaborative process, to ease their communication with one another by applying some of the tools used by the mediator or collaborative lawyer. It is always a little surprising to see how much difference it can make to a conversation just to start a sentence with “I heard…” or to have discussions reframed. One client, or a lawyer, confirming that they are listening and giving an immediate opportunity for any miscommunication to be corrected can be the difference between a discussion continuing or closing down.
Conclusion: relationships
are the beginning, middle and end
Family lawyers are not responsible for the happiness of their clients but the good ones care about it a lot.
ADR offers an opportunity to place relationships at the centre of a separation. It can give clients the best possible chance of not just surviving but (eventually) thriving following a separation. It shouldn’t be presented as a silver bullet: it is hard and often requires constant work from all involved to keep things on an even footing. But the results can be worth it in terms of client happiness, now and in the future, and this can be particularly true for HNW and UHNW clients who need a bespoke process and who may have particular scheduling difficulties and privacy concerns.
TO RISK THE CONGENIAL COST OR
GO IT A LOAN?
Authored by: Courtney Bosley (Senior Associate) - Schneider Financial Solutions
Alternative Dispute Resolution (‘ADR’) is, rightfully, touted for the flexibility it offers to divorcing couples. Why hand over control of your financial future to a judge in a courtroom when you are, perhaps, close to negotiating a settlement between yourselves, or only need a third-party decision on one or two esoteric issues?
Unfortunately, however, flexibility can bear a cost, particularly the uncertainty of that final outcome. For so long as couples hold the keys to their financial autonomy, they also exclude the enforceability of any agreement reached. While this risk may not seem to have too great a bearing where relations are amicable, and a couple wish to take their time to reach the right result for everyone, it does, crucially, leave an emergency exit door open for either party to abandon the selected
ADR route at any time. The parties may be willing to bear this risk, knowing that they can subsequently make an application to the Court if needs be, but what impact will this have on their ability to find the necessary funding? Like a game of snakes and ladders, they would be back at square one, facing a long, onerous Court system, but with assets already depleted by legal fees.
It has been queried as to whether this situation is not only a legal, but also an ethical one. Could it be said that the very process of obtaining a litigation loan places an undue compulsion on an individual to consider litigation, perhaps even over ADR (as they may initially have wished), in order to obtain the funds necessary to conclude their proceedings? Is there an unconscious manipulation at play?
Do the constraints imposed by regulations and macroeconomics help or hinder the provision of the right loans to meet needs?
It is, perhaps, inevitable, that introducing a third-party, such as a litigation lender, into a case is going to have a bearing on its dynamics. Where the borrowing party’s lawyers may previously have considered only their case strategy, they will now have to consider their loan strategy too.
There are two key situations in which this conflict may arise:
(1) At the outset of a case that could be negotiated, but there are a few sticking points. Do you take the risk and go to ADR, or do you bite the bullet on the Court process in order to line up the fullest possible funding?; and
(2) Mid-case, you discover that the parties are willing to settle outside Court, but there aren’t sufficient funds available under the loan to pursue this properly, and further lending is not possible. Do you find an additional sum to fund the ADR foray, or plough on with the Court?
In the first scenario, both the client and their lawyer have to take the time to consider the financial reality of a case, and the lawyer in particular will have to think beyond their timesheets: if the loan is taken out, when and how will it be repaid? Will the other party agree to sharing this burden, or will this contribution require a Court Order? What will the financial outcome be if the client is left to repay the loan from their settlement? Will engaging with ADR shorten the route to reaching an agreement, and therefore also the total legal fees payable, or simply use up any existing cash reserves before the parties inevitably attend Court, and limiting the sum against which any litigation loan could be leveraged?
to attempt ADR first. They should review their client’s cashflow position now, and how that will change. They should consider whether a financial advisor could suggest alternative options that would work alongside their loan, or as a precursor to it. If their client is the financially weaker of the two parties, perhaps the other party would agree to covering the fees for the ADR process alone, so this can be attempted without interfering with their ability to fund Court proceedings down the line. A litigation loan is a serious financial undertaking, and it should only be entered into with a full appreciation of its impact in real terms.
In the second scenario, the client and their lawyer will have to review each of the aspects raised above, but also consider the middle path: if they are attending arbitration, can they take advantage of the cost regimes? If other assets have been disclosed, can they use these to leverage alternate funding, or perhaps agree to an interim order for sale?
The
existence of a litigation loan does
not preclude a client from engaging in alternative means of raising funds, they simply have to remember the obligations into which they have already
entered.
In practical terms, the onus falls on the lawyer to provide their client with realistic fee estimate for each of the above scenarios, but particularly for if they begin Court proceedings off the bat, and if they allow time, and funds,
Therefore, while they are not necessarily confluent, ADR and lending can work together. It comes down to assessing whether there is space in the case strategy for the loan strategy to operate, what size loan is actually affordable, and, most importantly, which direction is in the client’s best interests. It is one thing to gauge the likely outcome of a case, it is entirely another, however, to step back and review what it will cost, emotionally and monetarily, to get the client to that point, and how this fits into the context of their client’s risk appetite, and willingness to compromise. Will ADR expedite that process, or will it actually make it more complicated?
It is not the purpose of this article to advocate whether clients should roll the dice on ADR or commit to the Court trudge, but, when considering this decision in the scope of legal lending, we would caution them to do their research, and make informed decisions. Cost estimates should be clear, accurate and affordable, and risks should be communicated up-front, and fully understood. At the end of the day, a loan is a financial product, it is up to the client how they wield it.
A FRESH START: WEALTH MANAGEMENT POST-DIVORCE
For someone who has gone through a divorce and finds themselves managing their finances independently, the risks associated with financial decision-making can be a real concern.
We provide guidance on how to manage and sustain a settlement in the longer term, making it work for a lifetime. Our role is to guide our clients during this pivotal time, unravelling the complexities to ensure that their financial position can be understood, and the right decisions are made.
To arrange an introduction, please call 020 7396 3388 or, email us: invest@londonandcapital.com
JENNY JUDD Director JESSICA CRANE Executive Director
WHAT SHOULD AMERICANS DIVORCING IN THE UK ASK A WEALTH MANAGER?
Authored by: Jenny Judd (Executive Director) - London & Capital
Divorces are always a challenging time for everyone involved. The emotional strain is felt not just by those individuals separating, but by children and the wider family. The decision to divorce is inevitably followed by a focus on financial issues and how family assets will be divided. This often fraught debate can become even more complicated when a family is international or the divorcing parties are citizens of different countries.
Q.1 – What is the biggest concern that American citizens getting divorced in the UK come to you with?
The tax implications of divorce are always a big concern. If it’s earlier in the divorce, there is often a conversation around which assets should be allocated to which individual. The outcome of that debate often depends on the differing tax positions and U.S. links and we would typically work alongside a UK/US tax specialist. There’s often a question mark over whether someone will go back to the U.S. or not and where their family, children and life in general will take them.
This can then lead to conversations around the importance of financial planning and getting clarity on future intentions. Divorce is likely to create the need for one partner to find a new property. This will often highlight the tension between using assets to pay for a new property and maintaining enough of an income from those assets to fund a certain lifestyle.
Q.2 - What should American citizens getting divorced in the UK consider when it comes to tax?
If the marriage is a mixed US-UK partnership, then care needs to be taken around which assets are held by which individual. Assets may need to be sold to generate capital and if these are funds in an investment wrapper, the tax implications on liquidation need to be considered carefully. For example, if whilst resident in the UK, a U.S. person sells U.S. funds (mutual funds) held in a US brokerage account, these funds
will be taxable at UK income tax rates rather than capital gains tax if they are not on the UK reporting list. A full review of the existing assets, looking under the hood at the underlying investments is important in this situation before decisions are finalised.
From 6th April 2023, all separating spouses are given up to three tax years after the year of separation in which to make ‘no gain no loss’ transfers for UK tax purposes.
In the US, there are similar ‘no gain no loss’ provisions which apply to US spouses. In the case of US-UK spouses, it may be possible to make an election for the non-US spouse to be treated as a US person in the year of transfer and thus potentially benefit from these provisions. However, there is a strict criteria that needs to be met in this scenario and thus it is important to consult with UK/US tax specialist who would be able to advise further.
Q.3 - Does owning UK property add complications to a divorce for expatriate Americans?
Potentially, it could. In the UK, we have something known as Principal Private Residence Relief where there is no capital gains tax when selling a property if that property is the main home. However, if someone is a U.S. citizen and the gain is over $250,000 on their share, they could have a U.S. capital gains tax liability. Additionally, if there is a mortgage on the foreign property and there is a plan to repay the mortgage as part of the financial arrangement, care needs to be taken that there won’t be a phantom mortgage gain which can become subject to tax in the US.
Their longer term intention for the funds or the time horizon might have changed and their tolerance for taking risk may no longer match the strategy.
It usually goes back to the fundamentals of investing and going back to a client’s future needs and objectives. As with all American clients, it’s really important they’re working with a wealth manager who takes a dual US-UK thought process when providing advice. This ensures that the investment will be appropriate regardless of whether the client remains in the UK or moves back to the U.S.
Q.6 - How can a U.S. client living in the UK map out their financial future after a divorce?
We use cash flow modelling to help our clients project their financial future. Cash flow models examine your assets and debts along with income and expenditure. Projections can then be created on future finances. Most cash flow modelling tools only take into account UK tax, but ours takes into account both U.S. and UK tax rates. This makes the model a lot more accurate.
Q.4 - How do American couples divorcing in the UK typically handle combined finances like joint investments?
Complications come if it’s a mixed UK-US marriage as the tax position will be different for each individual. We would often have a conversation around whether the existing investment strategy is still appropriate for the individual we are advising.
Q.5 - What challenges do Americans divorcing in the UK face when thinking about the future of their children’s education?
Often, we come across clients with 529 plans set up whilst still in the U.S. for their children’s education. Depending on whether the children decide to go to a U.S. or UK university, the costs are going to be significantly different. It will be a lot higher in the US. In addition, there may be UK tax considerations with respect to 529 plans and if the child decides to go to university in the UK, they may not be able to use funds without tax implications, therefore advice should be taken on 529 plans generally and how best to fund their education from their income/assets.
Q.7 - It can be hard to know what to ask a wealth manager when it comes to divorce. What questions should people ask and what should someone consider when choosing a wealth manager?
Quite often wealth managers can slip into using jargon with clients. I would recommend that clients don’t refrain from asking for a simpler explanation when they don’t understand something. It is also important to understand the fees being charged and what you are getting in return.
Take your time and never feel rushed into making a decision.
Divorce is an emotional time and clients are more vulnerable during this period so always take time to think things through properly.
A final thing to consider is that if a client is an international American, it’s very important that they work with a wealth manager that has an appreciation of both sides of the Atlantic.
EMBRACE ADR
OR GET LEFT BEHIND
Authored by: Alexandra Lukanova (Associate) - Russell Cooke
This is my first published article. I only qualified a few months ago. When I was asked if writing an article on ADR was of interest, I got very excited. But that excitement quickly turned into hours of “non-chargeable” consideration of what this piece should actually be about. I settled on writing something short and something junior (and hopefully all) lawyers might actually read: lessons learnt on ADR from a junior family lawyer.
Before I go on and try to convince anyone reading this that ADR should be the default option, I want to stress something. Although we refer to ADR as any forum outside the courts, it should really be called DR as there should not be an alternative to the court system. Involving the court should be the absolute last resort.
I only joined Russell-Cooke this May. For starters, I did not realise that the world of ADR actually exists. Of course we all learn about different forums of settling the finances during the LPC, but genuinely offering these options to my clients, that was something new to me. So I had to quickly become proficient at summarising the methods one can turn to where people can discuss the issues they face and seek to reach a compromise whatever those issues may be. Added to this – it wasn’t just what the options were but which may be most likely to be most successful in the right time frame, included thinking about costs and whether or not the process was right for the client (and vice versa!).
The next difficulty is actually educating some clients that going to court should not be the default answer to their problems. The truth is clients look to their solicitors when making decisions
during this vulnerable time in their lives. So the forum clients ultimately choose is mirrored in the practitioner’s attitude and enthusiasm towards that forum. As such, it rests on us to promote a nonadversarial practice. One way of doing this is by being mindful of the language we use.
As Sir Andrew McFarlane says, “bit by bit the penny is dropping: the language is important.” Terms like “parties”, “opponents” and “winning” are becoming outdated.
At Russell-Cooke for instance, we refer to clients and their partners by their first names to promote a more collaborative culture. This culture should include everyone involved in the matter whether they work within or outside of our firm and whether or not they are the professionals or the people involved.
as a precautionary measure. This undoubtedly changes the ‘vibe’ of the case and settling can be more difficult. Of course in some cases court is both inevitable and necessary. But these cases are becoming increasingly rare. And thank goodness for that!
I must say that I probably got a little carried away with my ADR discovery when I started asking my colleagues how I can qualify as a mediator just one week of being qualified as a solicitor. But the truth is, most of the best family teams have multiple mediators (as well as arbitrators, collaborative family lawyers, and even private FDR judges) that clients could choose from and that broad offering is absolutely necessary to stay competitive.
Not only to stay competitive, but also to stay relevant (it isn’t just about being nice,
but having a good business model in a modern age).
Most aspiring solicitors had at one point in their early careers dreams of going to the high court to lead a law-reforming case. This has now likely changed. Or if it hasn’t, it should. I now see lawyers trying to impress each other by the speed they are able to settle cases – that should be the new dream (or perhaps doing things at the right pace in the right way).
the Solicitors Family Law Association as it was then called, and is only becoming more prominent every year. As such, it is not surprising that given the huge encouragement for people to make their own decisions and avoid the Courts, the Law Commission is asking if mediation should be obligatory. Likewise, the rise of the one-lawyer/two client model is exciting – if a little scary.
Believe it or not, there are practitioners that rule out all ADR options as being inappropriate for the case and do not even tell the client that there are other ways their separation can be settled apart from going to court. At the summer Yres party last month, one junior family associate said that her firm always immediately commences divorce and financial proceedings
It seems to me that all current family law trends in some ways signal to family law practitioners that, where possible, the courts need to be avoided at all costs: all the way from the introduction of no-fault divorce to the increased transparency in the family courts. The word trend does rather assume that this movement is somewhat new or en vogue – it isn’t. The shift began in the 1980s with the founding of Resolution or
So if there is one message I want to leave the new generation of family lawyers with, it is that ADR is the future of family law. If firms want to stay competitive, they cannot afford to ignore ADR. It is now more important than ever to remind our clients that their feelings towards the breakdown of their marriage should not dictate the method they choose to settle their finances.
As James Carroll often tells
our new clients: “there
is no shame in relationship breakdown – there is only shame in bad relationship breakdown.”
So will ADR add to your list of reported cases? No. Will it get you on the front cover of the papers? Likely not. But will you be proud to tell clients how you are able to settle cases quickly and amicably? Will your client be grateful that you provided a forum for them to separate with their partners in a dignified and cooperative manner? And will you end up at the forefront of current family law trend? Absolutely! If you are a junior family lawyer, or any family lawyer for that matter, it is time to fully embrace ADR or you risk being left behind. Ultimately, as Sir Andrew McFarlane says, “the real change will come by each one of us thinking about it, and then changing practice.”
“They are as strong on money as they are on children and they’ve got strength and depth in both silks and juniors.”
- Chambers & Partners, 2020
1KBW has a pre-eminent reputation in family law, both nationally and internationally. We are consistently ranked by the legal directories in the top tiers of leading sets for family law, and are unique in our strength in depth for both finance and children cases.
One Choice
One King’s Bench Walk
PRIVATE HEARING
by:
You might have heard lots of whisperings of “transparency” in the Family Court over the last year or so. What does it mean? Why is it important and how could it affect my clients?
In October 2021 the then president of the Family Division, Sir Andrew Macfarlane, acknowledged that “justice taking place in private…is bound to lead to a loss of public confidence”. He called for the Family Court’s rules on who can attend hearings, the reporting of its cases, and how parties’ names should appear on listings and judgments to be reviewed.
Mr Justice Mostyn, a High Court judge, is of the view that “if very rich businessmen are in court fighting at vast expense with their ex-spouses over millions, then the public has the right to know who they are and what they are fighting about. The judgment should therefore name names.
COURT DELAYS AND THE RISE OF TRANSPARENCY: WHY COURT IS BECOMING LESS AND LESS ATTRACTIVE FOR HNW CLIENTS
WILL I BE NAMED IN A PUBLIC JUDGMENT IF I CHOOSE COURT RATHER THAN ADR? / “TRANSPARENCY AND ANONYMITY”
Redactions can be made of commercially sensitive information, but…the redactions should never obscure the way the court has decided the case” (Gallagher v Gallagher (No. 1) (Reporting Restrictions) [2022]). The vast majority of financial remedy judgments anonymise the party names, but Mostyn J does not agree with this approach and has not anonymised his judgments since late 2021. Since parties have no control over which judge hears their case, they might be very concerned at the prospect of being named in a published High Court judgment which will be available on Bailii and other public databases.
They recommended that:
1. If a reporter attends a hearing, a standard Reporting Order should be made by the judge which:
a entitles the reporter to see the parties’ position statements, together with the ‘ES1’, which is a brief case summary document; and
b. permits reporting of what the reporter witnesses, subject to anonymisation and protection against intrusive and personal identification.
In May 2023, the Financial Remedy Court “Transparency Implementation Group” published its recommendations on each of the key transparency issues.
2. “The default position [for published judgments] should be one of anonymity” for the parties, but “there will be cases in which the presumption of anonymity will not be upheld”, which is a matter for the judge to decide on a case-bycase basis. Examples might include “situations of poor behaviour, either within the proceedings (by way of litigation conduct) or outside the proceedings in appropriate cases”, or where the public interest in identification outweighs the privacy justifications. The report also strongly encourages judges at all levels, not just High Court, to publish their judgments, to reset the imbalanced focus on “big money” cases heard by the High Court.
Authored
Kate Pooler (Associate) - Edwards Family Law
The Report has therefore, at least in theory, paved the way for judges of all levels to exercise their discretion in determining which cases are appropriate to be anonymised. This might be a scary thought for potential litigants.
Will I face significant delays if I go down the court route? / “Delays and vacations”
Following the Covid lockdowns and the temporary shift of all hearings to being remote, the courts that make up the Family Justice System are still dealing with significant backlogs. This can be in the processing of applications: at the time of writing, a number of the greater London courts are taking on average 18 weeks to issue new Children Act applications. Or it can be in the listing of hearings: even urgent Children Act applications are being listed for their first hearing up to six months from the date of the application.
In response to the delays, the justice system has implemented policies such as allowing courts to run at full capacity, lifting the cap on the number of days courts can sit, and recruiting more judges. Judges are seeing more cases per day, meaning their reading time is being curtailed.
In February 2023 it was confirmed that seven temporary “Nightingale” Family courtrooms would remain open in 2023 since they were still required, showing the strain the courts remain under today.
The most problematic effect of this strain that we have experienced is that it has led to numerous vacations of hearings due to a lack of judge or lack of courtroom, often at very short notice and often the day before. By
then, all of the work has been done and the parties’ barristers’ brief fees may have already deemed, meaning those costs are immediately wasted. There is then no guarantee that the re-listing will be within a reasonable time frame, indeed if it is a longer hearing, you might expect the listing to be a number of months away. That passage of time will require a repetition of work, or the creation of new work, such as updating disclosure and often the new dates are not fixed for counsels availability. These realities can be difficult for parties to stomach, particularly since their life can often be “on hold” pending the resolution that they were hoping the upcoming hearing might provide.
a settlement, you can ask the court to issue directions to Final Hearing. Private FDRs are designed to carry all the formality of a court FDR, and the major benefits are that it can be booked as soon as the judge is available, and that you can ensure your case is heard by a Finances specialist judge, something that is not guaranteed with a court FDR.
So what are the alternatives?
If your client is severely put-off by the idea of any risk of their “dirty laundry being aired in public”, or they have just been the unlucky victim of a courtimposed hearing vacation, what should they do instead to progress their case?
If the parties are at the stage of the Financial Dispute Resolution hearing (“FDR”), the second hearing in Financial Remedy proceedings which is focussed on encouraging the parties to reach a settlement, the best option is to organise a private FDR. A private FDR takes place outside the court structure, often hosted in a barristers’ chambers, and the parties choose and pay for the judge (sharing that cost equally). Any agreement reached will be filed at court in a consent order as normal, or if the private FDR does not secure
If your case is a Children case, or your Finances case is beyond the stage of FDR, the best option is to agree to arbitrate. Arbitrations can be arranged within a day or two if necessary, since they are only reliant on the availability of the arbitrator. Both parties will sign an Arbitration Agreement, which confirms that the parties will immediately apply for a court order to be made in the terms of the arbitral award. Arbitrators can often be flexible in deciding what evidence they need to hear and if, for example, there needs to be crossexamination, and they will listen to the parties in this regard. Arbitrations can therefore be more time efficient than court hearings. Much like with a private FDR, going into an arbitration you can be confident that your chosen arbitrator is a specialist who would have had the time to have properly considered all the documents in advance of the arbitration.
Conclusion
Whether reporting is a concern, you are given a court listing many months away or you find your client the victim of a last-minute adjournment, self-funded alternatives to court proceedings look all the more appealing in contrast to the changes and challenges the Family Court is facing and one of which your clients should all be informed.
High net worth divorces and family disputes
Our aim is to work collaboratively and strategically with legal teams to achieve the best possible outcome for clients.
We know that divorces can be messy, emotionally charged and sometimes extremely acrimonious. But we also know that with the right team in place, realisations can be maximised and even well-hidden assets recovered, so enabling your client to make a fresh start on a firm financial footing.
To find out more about how we can assist your client going through a divorce or dealing with a family disputes, please do get in touch.
Visit grantthornton.co.uk to find out more, or contact:
Hannah Davie Partner, Head of contentious estates and family disputes
T +44 (0)20 7865 2849 E hannah.davie@uk.gt.com
We help you resolve disputes through:
• Intelligence and research
• Expert witness services
• Valuations
• Asset tracing and management services
• Formal appointments
• Insolvency appointments
• Debt enforcement and recovery strategies
ADR IN HNW DIVORCE
Authored by: Helen Hatton (Chairman) - Central Associates
Alternate Dispute Resolution can be an intelligent, calm, and far less confrontational way of settling matters between divorcing spouses. It is one much encouraged by family lawyers and indeed is a route preferred by the Courts, which as a general principle wish to see all routes to settlement exhausted before moving to a courtroom battle. Whilst the Divorce, Separation and Dissolution Act of 2020 took great strides in reducing the grounds for disagreement, matters relating to children and financial arrangements remain to be settled by the parties so far as possible.
From a very human level, experience shows that ADR can dissolve into an exhausting and unsatisfactory sparring match, with each party testing the metal, emotional and financial reserves
and the patience of the other, before resorting to the inevitable courtroom bloodletting.
The truth for many is that the divorcing parties are not objective, they are still passionate about one another and trade insults and allegations freely.
As we all know, this kind of an approach is very damaging to the mental and even physical wellbeing of the parties involved and is certainly damaging to children of the marriage.
Cost, as stated, is not only measured in pounds sterling, but in emotional cost, lost opportunity to put these things in the past, all contributing to the creation of a trauma which can take many years to overcome, a state of mind from which trusting another becomes almost impossible. These are damaging injuries to carry.
Divorce is not a matter with which to be trifled. Never more true than for high net worth clients, who tend to have more complex lives, and of course more money to argue over, than the rest of us. Many divorcing high net worth clients have still more pressure placed on, than their more mortal cousins. The public ranking of HNW client personal conduct and the arising implied integrity (or lack of it) can be closely linked to professional and corporate reputation and therefore directly link to earning capacity and share value.
And, of course, many HNW clients are used to getting their way, are skilled in “power play” and can quickly become powerful and aggressive opponents, putting yet more stress on the other party.
Whilst solicitors and barristers construct the cases, carefully pondering grounds, strategy and tactics, constantly seeking to progress the interests of their clients’ in achieving a fair settlement, the contribution of an intelligence and investigations business is different. An important and often overlooked skills set within the professional team.
The role of investigator is to provide, or verify, the evidence which underpins the construction of the case, or indeed to unseat the position stated by the other side.
Whether in ADR or Courtroom proceedings, being able to prove that a financial disclosure is materially incomplete immediately secures significant advantage for the side that was about to be disadvantaged.
Similarly, being able to evidence that a stated position is simply untrue and misleading; or that a disclosed isolated incident is in fact part of a long-standing pattern of inappropriate behavior, are all examples of evidence which can provide solid foundations to the legal arguments being developed.
The role also plays some part in helping clients overcome their anger. It is not uncommon for clients to accuse their soon-to-be former spouse of lying. Much anger and hurt accompanies those statements.
position held was biased and unfounded. Either way up, resolution comes closer and people are more able to accept the truth and move on.
Calling out a false and misleading financial disclosure, for example, is an important step to demanding the relationship returns to honesty and mutual respect. Whilst it may be a useful lever in gaining a better settlement, it is also an enormous step to the client regaining a sense of being in charge of their own destiny and demanding fairness.
good job, no criminal record, a stable friendship circle, no compromising social media and two grown up children of their own who are responsible and nice young adults.
Conversely, of course, those positive statements may well not be true, in which case it is vital to discover inappropriate lifestyle issues before children are exposed to them.
Any ADR or Court situation will require very persuasive evidence before depriving children of reasonable access to a parent –or indeed the parent to the child.
Obtaining evidence to call out the lie, or in fact to establish that it is the truth, helps clients regain some control over their lives, hold the other party accountable – or – admit that in fact the
Where children and custody matters are involved this becomes particularly important. Parents’ divorcing can never be good news for children, but parents who can prioritise their parenting responsibilities over their spousal arguing, who can be fair and objective, be civil under difficult circumstances, do set children an example which is important to the development of their own life skills. Children are allowed to love their parents, even when their parents don’t love each other anymore.
A good investigations firm can provide a great deal of assurance to an anxious, and otherwise arguing parent, as to the current lifestyle and stability of their former spouse who is now seeking shared custody or visitation. This is particularly helpful when the former spouse has a new partner in tow – actually, the new partner has a
Good investigations drive “evidenced based decisions”. Evidence encourages logical progression and calms the fires of speculation, fury, and jealousy. When those emotions can be put to one side, sensible resolution can be found.
Many clients, are still not entirely persuaded by the evidence established and want an ongoing monitoring on the welfare of the children whilst visiting their ex-spouse. This can also be arranged. Much comfort can be taken from knowing that children are being taken to school on time, are well dressed and happy, are being collected on time, are safely supervised at football or gymnastics, are enjoying supper with their parent at a local restaurant. Conversely, if standards slip dangerously, evidence is at hand to return to legal tactics to vary the custody order.
THE COST OF EMOTIONAL DECISIONS
What causes conflict?
Our brain has not evolved much since we were cave people. Back then the brain’s primary function was to keep us out of danger and away from pain, and a million or so years later, it still only cares about our personal survival. So, whether we are facing a sabre-toothed tiger or heartbreak/stress from divorce, the primitive brain reacts in the same way.
It perceives danger, activates our defence mechanism (the fight, flight, or freeze response), and sends our entire nervous system into high alert.
Our nervous system is our control centre, it’s responsible for our thoughts,
actions and feelings. When it is in high alert the logical, wise, solution based part of our brain virtually shuts down and up to 95% of our thinking starts to happen from the emotional part – the part where all our emotional wounds, and emotional triggers are stored. This can mean that majority of our decisions, actions, emotions, and behaviours are coming from beyond our conscious awareness.
In other words, during a stressful/ traumatic situation, such as a divorce, our judgement becomes impaired, and up to 95% of our thinking is done emotionally rather than logically, creating a perfect opportunity for conflict to slip in through the back door and take a firm place at the negotiation table.
How to reduce conflict
The good news is, we can get back in the driver’s seat of our emotional process and regain our control. The great news is that it does not have to be difficult.
Authored by: Sonia Limbada (Divorce Recovery
Coach) - Divorce Consultants
There are many ways we can manage our emotions during divorce, here is my simple 3 step process that I call, ‘Ask, Centre, and Choose’:
• ASK
The first step towards amiability can be as simple as asking, ‘Which part of me is showing up in negotiations? Is it the emotionally triggered/wounded, unconscious part, who wants emotional justice OR is it the logical, grounded, compassionate, conscious adult part, who wants to bring solutions, not problems/wounds, to the discussion?’
This question compels us to step into our consciousness and hold a mirror up to ourselves, so that we can work out which one of our triggers is running the show.
• CENTRE
When we are operating out of our triggered mind, we listen from emotional ears. What someone says, and what we hear becomes poles apart. Therefore, once we bring the unconscious triggers up to our consciousness, the second step is to centre ourselves.
Centring ourselves is about knowing how to regulate our nervous system so that we don’t make life changing decision in this high-alert, survival energy. It is easier to regulate our nervous system through our body than it is through rational/logical words. Our body holds immense healing wisdom and provides us with all the tools we need to get anchored in safety. One of these tools is our breath. Controlled Breathing soothes us and helps the body feel safe. When we help the body feel safe, we automatically help the mind feel safe. This feeling of safety fosters calmness and empowers us to function at a higher adult level.
The beauty of controlled breathing is that we can access this tool anytime, anywhere to regulate ourselves.
Simply breath in deeply for the count of four, hold your breath to the count of 6, and breathe out for the count of eight. Repeat 4 times before resuming the natural breathing rhythm.
• CHOOSE
Divorce is a life event where we are continuously at risk of being pulled back into unconsciousness. Despite how much we self-regulate, there will be those fraught moments, when the ex says or does something and every muscle in our body fights to default to our fight or flight mode.
In our fight or flight triggered mode, we tend to react automatically, without thought. It’s what nature intended. Triggers are followed by unconscious reactions because life-threatening situations don’t require thought they require action.
The thing is, divorce is not a lifethreatening situation and automatic reaction during negotiations is the seat of conflict, rather than a necessary survival skill. When we allow ourselves to react impulsively, we dive into the other person’s emotional chaos with them and create an even bigger mess.
So in this 3rd step we learn to move beyond the automatic ‘trigger and reaction’ cycle. To do this we must recognise that when we are emotionally triggered, we have two paths, not one. The first path is the impulsive reaction which leads to conflict. The second path is a conscious choice that leads
to a thoughtful, response. The trouble is, most of us don’t use our power of conscious choice because our nervous system is so adept at overriding it.
To take back control from our nervous system and step into our conscious choice, all we have to do is pause before we take any reactionary action and remind ourselves that we have the power to choose consciously rather than react impulsively.
Purposefully delaying a reaction and acknowledging our conscious choice gives us an opportunity to think strategically rather than emotionally. It shifts from an automatic, unconscious reaction, to something new, something more solutional.
In conclusion, conflict is expensive, to reduce it, we must become aware of our triggers, self-regulate, and practice the art of conscious choice instead of automatic reaction.
60-SECONDS WITH:
COURTNEY BOSLEY SENIOR ASSOCIATE SCHNEIDER FINANCIAL SOLUTIONS
Imagine you no longer have to work. How would you spend your weekdays?
Can I still choose to do some work?! It sounds slightly sycophantic, but I consider what I do to be incredibly fulfilling, and I can’t bear mental idleness! If I did manage to pry myself away from the office mid-week, however, I would love to spend time volunteering at pro bono legal clinics, actually using my museum memberships, or maybe even tackling the ever-growing pile of books on my ‘must read’ list!
What do you see as the most important thing about your job?
Whatever pejorative labels some might at times apply, the service we provide is an important one, and it exists for good reason. The macroeconomic context in which we all operate is an ever-changing one, and fortunes can be made and lost in a very short space of time. In this space, it’s not just a case of clients being ‘asset rich, cash poor’, but also the extent to which those assets may yield future returns that would benefit all involved. This is the sort of opportunity we want to enable. Our loan offerings allow individuals to leave their cash investments where they can maximise their possible gains, and takes away the strain of their ongoing legal fees at a time when tensions are already, at a natural high. It’s a mutually beneficial solution.
What motivates you most about your work?
A job well done. Whether that’s working to a tight deadline to get the funding in place for a fast-approaching hearing, smithing a creative way to step into a lending gap that others may refuse to fill, or even crafting the right contract. While we are, of course, respectful of our regulatory requirements, we can be as creative as we like within that space, and that challenge is a thrilling one. From the direct client/solicitor negotiations, the due diligence investigations, or the drafting of the contracts, I get to experience each stage of the loan journey, and there’s nothing better then that moment it gets over the line.
What is one work related goal you would like to achieve in the next five years?
While I do, obviously, look forward to moving up the chain at Schneider FS, and taking on more responsibilities in my role, one key thing I do want to achieve as a precursor to that is to improve my business and financial awareness overall, and the network of individuals to put that into practice. The more I understand, the more innovative I can be in the loan offerings we are able to provide. Watch this space!
What has been the best piece of advice you have been given in your career?
That if something crosses your desk, it becomes your responsibility too. It has taught me to be accountable from all perspectives, whether I was preparing a draft, approving someone else’s, or just sending out the final product in an email. Not only does this strengthen the sense of team, where you are all pulling together, but it also ensures you never drop your attention to detail; when it’s everyone’s job to make sure something is right, you can’t delegate that away.
What is the most significant trend in your practice today?
Loan repayments not being made on time! The economic upheaval we have all experienced recently has cut the legs out from under many asset classes, and this, in turn, has had an inescapable ripple effect through people’s abilities to repay their loans. Without a steady stream of repayments, we are limited investing in new loans, and it seems to have brought the market to somewhat of a standstill. We cannot however just sit and hope that the block will pass, and so the team has been working hard on building further lines of credit, which we hope will start to feed through in the next month or so, but it has been a source of some frustration!
Who has been your biggest role model in the industry?
I’ve learned from so many wonderful people that it feels unfair to distinguish between them. I would be remiss, however, if I didn’t mention our COO, Alex Hulbert. I was completely new to the world of litigation lending when I joined Schneider FS, and he has gone above and beyond, in his example and
mentoring, to get me to where I am now. I still have a lot to learn, but I aspire, one day, to achieve the same level of business acumen, legal skill, and social grace. It’s an inspiring combination.
What is one important skill that you think everyone should have?
Active listening and engagement. I’ve seen far too many communications flounder on misunderstandings, wilful or ignorant, and arguments escalate from being carried too far on a Pyrrhic principle. We all owe each other the basic respect of listening to what we are saying, and taking the time to process what is said. Once we do, it’s amazing how much we can resolve, learn, and move forward, all without needing to refer to a third party decision-maker, or damaging our underlying relationships.
What cause are you passionate about?
Helping victims of domestic violence. I used to volunteer while at law school, and the strength that each victim showed was at once humbling and empowering. While I’ve now stepped away from private practice in family law, I’m keen to use the new skills and experience I’ve found to identify other ways to get involved in the future, and to help as many as possible to feel safe in their homes and relationships.
Where has been your favorite holiday destination and why?
I would have to say Cape Town, in South Africa. The richness of the history, culture, and generosity around you is truly awe-inspiring.
Dead or alive, which famous person would you most like to have dinner with, and why?
My answer to this question always changes, but right now it would have to be Jane Austen. Her books have brought me so much joy over the years, it would be beyond words to meet the mind that created them. In addition, I would also finally find out how Sanditon was supposed to end!
PRIVATE FDRS
MAXIMISING SUCCESS
Authored by: Michael Finnegan (Associate) - Burges Salmon
Over the last decade or so, the popularity of Private FDRs has grown exponentially. This growth was accelerated by the Covid-19 pandemic, where the strains on the court and delays in hearing new and existing cases encouraged practitioners and their clients to seek alternative means of reaching settlement.
The various benefits of Private FDRs are well known: flexibility in terms of date, judge and location, and the full focus of a judge who has had time to fully read into the case and understand the issues. The only real disadvantage is the often significant cost when compared to the court FDR. Clients will undoubtedly want to feel that this cost is justified and so it is crucial that lawyers do what they can to maximise the chances of success.
With this in mind, below are some tips for maximising the chances of achieving settlement at a Private FDR (“PFDR”). Although many of the points may seem obvious, they are often overlooked.
Judge
Lawyers will often select potential judges based on who they have worked with before, which makes sense, but should not be the sole consideration. A judge might be perfectly suited to one PFDR but much less suited to the next one that comes up due it containing very diffident legal or factual issues, or different types of client. Past experience is certainly a good starting point, but it is important to consider the major issues in the case and who may therefore be best suited to adjudicate based on the specialist areas of practice.
The parties’ views should also be considered – are they likely to prefer someone who will take a more technical approach and get stuck into the detail or would they prefer a more holistic, broad-
brush approach? Are their personalities such that they need someone who will be firm or are they more likely to reach settlement with someone who takes a more dynamic approach? Similarly, are they likely to benefit from someone who tends to give a more precise indication or from someone who gives a bracket for settlement with room for the parties to work within that. These are nuanced but important considerations.
The Bundle
Timetable
Once a date for the PFDR has been set, a timetable should be agreed so that everything required to have an effective PFDR takes place in advance of the hearing. Even if the PFDR has been agreed to take place on the same day as the court FDR would have, a timetable should be confirmed in writing, which may or may not be based on the court one. This should however include the standard directions included in the court timetable. Where there are no proceedings, it is still important to ensure directions are agreed, and there may be an opportunity to agree additional directions that are not usually included a court First Appointment directions order. As part of this, and as discussed at points 3 and 4 below, it is important to ensure agreed directions are complied with plenty of time before the PFDR so that the parties and their counsel can properly prepare and so that one party does not feel unable to settle on the day due to insufficient preparation time.
Proposals
Settlement proposals should be made as far in advance of the PFDR as possible. This should ideally be one to two weeks before the PFDR, but certainly no later than two or three working days before. This allows both parties to reflect on the proposals of the other party (bearing in mind there may be significant differences) and also allows the lawyers and judge to consider these in plenty of time and consider the net effect of each of these and where the main differences are.
Whilst it is not recommended that the bundle be excessive in size, it should be remembered that in a PFDR there is more flexibility with the bundle. Documents that may not ordinarily be included in a court FDR bundle can be included (by agreement) if they might assist the judge, who will have more time to review the bundle and understand the issues. This should not however give free rein to the parties to become complacent and lodge a large bundle full of irrelevant documents which the judge is not able to read in full and digest. It should still be limited to key documents relevant to the main issues in dispute. The bundle should also be agreed between the parties and circulated in plenty of time (usually a week before the hearing) to ensure the judge and both counsel have plenty of time to become familiar with it.
Counsel should have a separate room so that they too can have frank and open discussions, without having to attempt to negotiate quietly in a corridor.
In terms of the seating arrangements in the hearing itself, ideally the parties should be seated so that they are not facing one another, but so that the judge can see and communicate with them equally.
It is preferable to obtain the judge’s indication before lunchtime if possible, so that the parties can have plenty of time to ruminate and discuss with their advisors. If the indication is too late in the day it will not allow proper time for them to negotiate, nor to go back before the Judge to explain any blocks or impasses in negotiations that the judge may be able to give an opinion on.
The parties should also ensure they have made any childcare arrangements as PFDRs can often go late into the day and sometimes into the evening. The chance to settle can be lost if momentum gained during negotiations is lost if one party has to leave.
Ensuring there are printing facilities available is also something which seems obvious but causes issues far more often than it should. The judge might want to circulate a written indication or heads of agreement may be drawn up to be passed between the parties and signed.
Practical Arrangements
This is a crucial yet sometimes overlooked (in the context of the other aspects of PFDR preparation) element which can be the difference between a successful and unsuccessful PFDR. Careful consideration should be given to the space where the PFDR is taking place. The rooms themselves should be big enough so that the parties do not feel confined and under pressure, and the rooms for the opposing parties and their lawyers should be sufficiently far apart so that everyone feels comfortable having confidential conversations without fear of being overheard, or indeed so that one party does not overhear something out of context which changes their approach.
Conclusions
None of the above points in isolation above should make or break a PFDR and every lawyer will have their own preferences and style. There are of course many other competing considerations to be taken into account, but by ensuring careful consideration has been given to all aspects of the process, practitioners can maximise the chance of avoiding the wasted costs and stress of a failed PFDR, and potentially many more months of litigation. As PFDRs continue to gain popularity, lawyers will need to ensure they have a clear strategy and approach to maximise success.
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The Legal 500 UK 2021
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We assist clients at all stages of their lives, whether at the beginning of a relationship and planning a future (for example before a wedding or when relocating to the UK) or at the end. Many of our clients or their spouses have international connections, are high net worth individuals and city professionals, or individuals with a public profile.
For further information about our practice, please use the contact details below.
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DO IT OUT OF COURT
Authored by: Karin Walker (Solicitor) - KGW Family Law
‘Out of Court’ dispute resolution has been seen as an alternative option for separating couples for over four decades but as the court system falls further into disarray family practitioners are being actively encouraged to keep their clients ‘out of court’. Arbitration and particularly mediation (with the extended government financial contribution) are becoming increasingly prevalent. In the midst of a “cost of living crisis”, funding for additional training may not be readily available. Never has it been more important however for family lawyers to have the skill set to recommend alternative forms of dispute resolution to those requiring their guidance.
It is both natural and inevitable as a practitioner to lean towards the familiar. As a consequence, we are witnessing the rise of the pFDR as the preferred alternative dispute resolution route. Viewed as the most successful element of the financial remedy proceedings process the court version of the FDR can be easily replicated. The process is identical, differences being the ability to select date, venue, and Judge.
In the court context the FDR provides an opportunity for the Judge on a without prejudice basis to hear an
overview of each party’s position and endeavour to “nudge” the couple towards an outcome which meets needs and is apparently fair.
The FDR takes the usual negotiation process which has always occurred in the corridors of the courts to a more structured discussion presided over by a member of the Judiciary.
In the context of the court process whether in financial remedy proceedings or children act proceedings, this presents as an oasis in an otherwise process and procedure driven method of dispute resolution.
But what about all of the other options? Most particularly, if the couple have children, what about helping them to develop the ability to construct their own decisions and create an outcome of which they have ownership. Without doubt there will be times in the future when another crossroads is reached. Will they always need to resort to a quasi-judicial process? Or can they look at other alternatives which you as a family law practitioner have already helped them to consider.
The pFDR is an excellent resource, but it is not the only one.
6th April 2022 saw the implementation of the biggest change to the divorce process in the practicing lives of us all. Finally, “no fault” divorce became a reality. At last, the divorce mechanism had caught up with the more collaborative approach to dispute resolving.
The new process lends itself to being used by the couple alone. The application is made online, and the forms are intended to be completed by a lay person. The cost therefore has reduced to just the court fee.
The stark reality of this change is that separating couples no longer need to seek out a family lawyer before taking the first step to bring their marriage to an end. Never therefore has it been more important for separating couples to have access to clear and concise information about how to best deal with issues which will almost certainly arise.
The new system heralds a dangerous rise in litigants in person. Inevitably this will place an even greater pressure upon a Court system already in crisis.
Ideally family practitioners need to both ensure that they are able to provide clear and concise information about options available but also work together to maximise the availability of such information through the press and social media.
Alongside this, it is important to remember that lawyers work in a commercial environment with a requirement to meet targets if the provision of services is to be sustained. There is an inevitable nervousness that a more expeditious dispute resolution method may result in lower fees. In reality however, a more affordable and compact service is likely to have a greater attraction thereby increasing the number of separating couples prepared to take legal advice. In turn this could
have the effect of reducing the number of litigants in person. A quicker turnover of work for clients with more affordable fees will inevitably improve and increase cash flow.
You may also wish to consider what sort of reputation you wish to create as a practitioner. Historically most of those requiring legal advice on separation have a misconceived belief that “court” is the place to go. If that is correct, then surely they will be looking for someone with a reputation in the court arena. In reality however most referrals are likely to come from previous (satisfied) clients, other family lawyers or professional contacts.
In addition, the wellbeing of family lawyers has become a current hot topic. The court process with its deadlines and time limits is undoubtedly stressful. Add to that a client who has a mixture of unreasonable expectations and soaring legal fees and the difficulties become apparent.
Running a case load where you are able to set the diary, structure the process and create a bespoke environment will inevitably create a healthier and more relaxed working environment.
I have touched on the client expectation that court is an inevitability. It is important to develop a skill set aimed at dissuading your client from this view. You should not be afraid to spell out just how inefficient the court process has become. Constantly we see posts on Linked In, Instagram and other forms of social media depicting horror stories of cases being taken out of the list the afternoon before due to lack of judicial availability, bundles not reaching the Judge and applications taking many months to be listed. We know that nothing is going to be done to improve this situation. The ability to create a change therefore lies in our own hands.
Of course, it is not just about persuading your client to adopt an out of court option. There are of course two people involved in any separation. Out of court dispute resolution remains voluntary. How many times have you heard it said “I would recommend out of court dispute resolution but the ‘other side’ won’t agree”. Perhaps you have been that “other side”?
The two main arguments employed against the use of out of court dispute resolution options are:
• This case is unsuitable
• The “other side” won’t agree
In reality, almost every case is “suitable”. If family lawyers adopt the approach of considering alternatives to court in the first instance, the intransigence of the “other side” must become a thing of the past.
In any case, making an early approach to the “other side” is important. Increasingly, we communicate via the medium of email, which is both avoidant and non-discursive. It is very difficult to openly state that you are not interested in working constructively. If the “other side” is unrepresented, your initial approach to them is more likely to be in writing in order not to be open to misinterpretation but should still be conciliatory and inclusive. In all cases, the first communication is so very important and needs to take place in a manner which will avoid the drawing of “battle lines”.
If you can get this right, you take an enormous step in the right direction and may in fact find that the “other side” is not as awkward as you may have inspected.
However acrimonious a couple might be, they need to achieve an outcome which will enable them to move forward separately. Selecting a process which will diffuse as opposed to escalate hostility will always pay dividends, particularly for the children.
Whether or not you have any form of out of court dispute resolution training, it is so important to familiarise yourself with all of the options available. If you feel that you or your team are ill equipped for this role, perhaps even consider inviting
a local practitioner accredited to provide Information Mediation Information and Assessment Meetings to come and talk to you / your team in the same way they would for a separating spouse at an intake session. Even now, “out of court” options are seen as “alternative”. The word “alternative” means “different to that which is in existence”. The underlying suggestion therefore is that “out of court” is not the “normal” way of doing things. This is a perception which needs to change.
So, what are these “alternatives”?
Mediation and Hybrid Mediation
Although mediation is more clearly in the public domain than other methods of dispute resolution, the process is still not readily or fully understood. The skill structure of a mediator is often undervalued. It is often incorrectly assumed that mediation is only “suitable” for separating couples who have a high degree of agreement. Mediation provides a “safe space” with a neutral facilitator to consider options in a “without prejudice” environment with a view to constructing an outcome with which both of the couple are content. The ability to discuss is maintained and the outcome can be far more imaginative than anything which a court might impose.
For high conflict couples, the hybrid model is an excellent alternative to court. The only difference between “classic” and “hybrid” mediation is the mediator’s ability to hold confidences in order to better facilitate the negotiation.
Confidences might relate to fears, concerns or aspirations. The sharing of this information provides the mediator with a better understanding of the thought process of each of the couple, thereby enabling the mediator to better facilitate the negotiation.
Lawyer assisted mediation can also be enormously beneficial for those couples for whom a court application might appear to be the only alternative. With the maintenance of separate breakout rooms and the ability to take advice within the mediation process, the discussion is focused and informed. Recognising that resolution is the desired result of both of the couple, however acrimonious, the mediator can encourage an outcome safe in the knowledge that each of the couple is receiving legal advice at the same time.
Mediation is one of the central elements for the process known as “The Certainty Project”, which combines mediation with arbitration (see below).
Collaborative Practice
Both parties instruct a collaboratively trained practitioner. Each of the couple prepare a “mission statement” – what is really important to them in this process?
Negotiation does not take place in writing. There is a four-way meeting which will be arranged to work through the concept of “what is there and how should we divide it”. Financial disclosure is provided openly but discussions are “without prejudice”.
Collaborative practice provides a real feeling of the couple working together, each represented, but involved in a group of four with a common objective, rather than two groups of two on opposing sides.
Neutral Evaluation
Inexpensive and quick to arrange, neutral evaluation is a great resource at all kinds of pivotal moments in any negotiation. It can be used as a “stand alone” remedy or be brought into other forms of dispute resolution where impasse has been reached. If at the commencement of the case it is clear that there are issues which are easily arguable either way and unlikely to be resolved by agreement, bringing in a neutral evaluator right at the outset can avoid polarisation over many months. Neither party is obliged to accept the view of the neutral evaluation, but they may be foolish not to do so. Both lawyers will ensure that they select a neutral evaluator whose opinion they hold in regard. With the increase in the “one lawyer two clients” model, neutral evaluation is likely to become even more prevalent.
The Private FDR
Already dealt with above, the pFDR replicates the financial dispute resolution stage of the Court process and has gained enormous momentum in recent years. For many practitioners, this is a first and obvious step towards out of court dispute resolution as it so closely replicates the system in which they have previously been involved.
Arbitration
Arbitration is the private adjudication process. Again, gaining momentum, it is suitable for the high-net-worth cases where privacy is so important alongside those cases where there is very little to divide, which in itself creates a greater level of complexity.
Arbitrators are keen to develop a reputation of being both diligent and fair.
This is the only way in which they are likely to secure repeat work. An arbitrator is likely always therefore to be a reliable option. The process is often assumed, incorrectly, to be expensive. Although the couple must share the cost of the arbitrator, the reduction in overall cost as a consequence of reduction in time and the bespoke nature of the process is likely to mean an arbitration will cost approximately 50% of the costs incurred through going to a Final Hearing in the Court system.
Take up has always been slow in children proceedings. The reason for this is probably the fact that delay will always suit one parent. In no circumstances, however, does delay suit a child. It is incumbent therefore upon family lawyers to encourage their client to focus upon that which is in the best interests of their children as opposed to self-interest. The welfare of the children is, of course, the primary concern for us all.
Obvious benefits are:
• Choice of venue;
• Choice of date;
• Bespoke service;
• Complete privacy;
• Ease of communication with the arbitrator during the process;
• Swift interlocutory decisions where required.
The Certainty Project
The Certainty Project represents the fusion of mediation and arbitration. The title “Certainty Project” derives from the expectation that separating couples will benefit from as much “certainty” as can be achieved. This is with particular reference to timing, location, and cost.
The project can be applied to both financial remedy and children proceedings. It applies both to parties who are represented and litigants in person. The selected arbitrator will have “umbrella” control of the process. Where instructed, lawyers will deal with disclosure, valuation evidence, and the instruction of any expert. The couple will pass first into mediation (classic or hybrid). The mediation element can, however, be replaced with collaborative practice, or simply interparties’ negotiation. If agreement cannot be achieved, notwithstanding best endeavours, the arbitrator identified at the outset will step up to provide an adjudication.
So, overall, what are the key points to remember?
• Your new client may have an expectation that “Court” is the place to go. Think about whether theirs is one of the exceptional cases which requires judicial intervention, or whether really an out of court dispute resolution method would be more beneficial.
• Out of court dispute resolution methods really are “alternatives”. They are tailored and adapted to suit the specific needs of each individual couple.
• Ensure that you cannot be perceived to be the “belligerent” other side, who refuses to consider out of court options.
• Ensure that you and your team have comprehensive knowledge and an ability to communicate the benefits of all forms of out of court dispute resolution.
• Have the confidence to build the practice and reputation which you feel both you and your clients deserve.
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...what we love is that they are so pragmatic and commercial, real team players
