Family Arbitration: A Flash in the Pan?
It seems clear that Family Arbitration has something to offer in the divorce arena, but will it be adopted by the legal profession as another tool in the divorce tool-box – or be quietly left in a cupboard to be brought into the light only by a small band of hard-core enthusiasts?
It does have some limitations – currently, Arbitration cannot be used to decide children matters.
“Arbitration is certainly …a huge untapped resource at the moment… it can determine financial matters be it a discrete issue such as the level of maintenance or all issues as to financial/property settlement between spouses or unmarried couples…. It is not yet used for matters relating to the welfare of the children.” Olive McCarthy, Breeze & Wyles
Yet – according to Family Arbitrator, Sir Peter Singer – there are some who predict that as a logical development the Family Court judiciary will support this when English private children law principles are applied by experienced and trained family practitioners.
“They point to the fact that child issues are already arbitrated under Scotland’s version of the IFLA Scheme, and anticipate a parallel development south of the border.” Sir Peter Singer, Family Dispute Resolution Facilitator and Arbitrator (MCIArb)
Is Arbitration inherently part of an adversarial process?
From legal minds I have heard the viewpoint that Arbitration is inherently ’adversarial’, because it involves someone else making a decision on behalf of the couple. But personally – as well as in my role as the Alternative Divorce Guide – I see an enormous difference between a couple in mediation mutually agreeing to instruct a highly qualified person to make a decision on a financial issue, which the couple are unable to resolve themselves – and then to continue on with the mediation process – rather than the alternative. That alternative can often be that the couple give up on their mediation process and go to court, where the mediation agreements to date might be disregarded by the judge. High costs, more inconvenience and greater emotional trauma for the whole family will often ensue.
Because Arbitration keeps the couple ‘in control’ of the process, that in itself should encourage a greater level of communication and cooperation, compared to if they are throwing letters at each other via separate solicitors. Christopher Pocock QC sees Arbitration as an empowering process for clients: “If you start the arbitration process and then agree, or agree part, that is fine – the arbitration is your process, so insofar as you agree something, it happens”.
“You can, of course, refer the entire financial application to arbitration. Yes, one of the advantages is that it can deal with just “the parts other ADR cannot reach”, but you can also do the whole thing that way – and you will keep your chosen arbitrator throughout the process.” Christopher Pocock QC, Barrister at 1kbw Chambers
Is Arbitration just for the rich?
But paying for your own ‘private judge’ – is that something that most ordinary people will be able to afford, or to access? Sir Peter Singer believes that Arbitration is accessible to most people navigating divorce:
“I would like to emphasise that arbitration is not just for the rich and famous: it offers many of the same advantages to Mr and Mrs Average as to those whose net worth is high. And amongst the 130 or so MCIArb qualified arbitrators there is a range of talent and experience and a spread of geographical availability which puts them within the range of most any couple otherwise headed for court.” Sir Peter Singer, Family Dispute Resolution Facilitator and Arbitrator (MCIArb)
“Arbitration is the way forward, the benefits are huge for clients particularly the costs. In the last year, some of the most eminent members of the profession agreed to fix the costs of achieving an award for £1,500 plus Vat – that’s £750 per person in straight forward cases. So strong is the belief and commitment to this scheme, Arbitrators were prepared to effectively “put their money where their mouth is” in making this offer.” Olive McCarthy, Breeze & Wyles
So is family arbitration being taken seriously?
Arbitration is being taken seriously by judges – perhaps because it has the potential to release some of the burden of litigants clogging up the courts.
The arbitration process for financial disputes in general and the IFLA Scheme in particular has received important endorsement from the President, who heads the Family Division, in a case he decided earlier this year: S v S.
He made it clear that in normal circumstances a court should be swift to confirm an arbitrator’s award in a court order, and to preserve the confidentiality of the process so that individuals and their financial arrangements will be kept free of press or public comment.
Further impressive support since that decision has come from the Financial Remedies Advisory Group’s report at the end of July which, amongst other things, recommended that the President should issue Guidance specifically directed to arbitration and produced a draft which is currently the subject of consultation.
According to Sir Peter Singer, the ability of parties to conduct an arbitration in relation to their private financial affairs without fear of unwelcome publicity is another important advantage which the IFLA Scheme offers.
What may draw people to Arbitration more than any other factor, indeed, is the privacy aspect, and the perception of fairness when the balance of power within a relationship is heavily skewed – though in reality an experienced mediator will help keep that balance. But for some clients, Arbitration may be of value for psychological reasons.
“It is perfect for resolving discrete issues in a binding way and can assist parties who are frightened that they may be making too many concessions.” Malcolm Martin, Solicitor and Family Law Arbitrator
Your own private court
The way I see it, Arbitration is like your own private court with your own private judge, hired by you, working to your availability and time scales.
Also, the couple can choose their Family Arbitrator, picking one who is specialised in the required legal area, and they are still in control of their case. If they go to court – they do not get to choose the judge and it can take months instead of weeks to get the decision finalised. A significant benefit of arbitration is confidentiality and privacy. These cannot be assured in the court process.
* The parties decide the venue (rather than be stuck in a Court waiting room with hordes of others – only to be stood out!);
* The proceedings are confidential – and so cannot be reported (a great advantage to many), and…
* The parties decide on the level of disclosure (again, this might be a great advantage especially if there are few assets and/or only one issue to be determined).” Richard Nail-Cain
The convenience factor
Perhaps it is the flexibility and convenience of Arbitration that will make it popular with busy professionals who just don’t have the time to battle out their divorce in the court room, let alone the desire for all that additional stress and misery.
“The Arbitration process is flexible in relation to timing. No need to wait for the court to appoint a judge when it suits the court diary. Family Arbitrators are likely to be able to arrange their diaries to suit the parties. So this means late sittings or even weekend sittings. So the couple are not faced with having to come back on an adjourned hearing in 2 or 3 months’ time because the judge is not willing to sit after 4-30.” Martin Loxley, Partner Irwin Mitchell LLP
Who needs to be convinced first – the public – or the legal profession?
Not only do the public need to understand the benefits of Family Arbitration, but so do family lawyers – as it is another tool in the divorce tool-box that can benefit their clients. It’s usefulness is too immense to be disregarded. According to Sir Mathew Thorpe, Arbitration could be one of the most significant developments in the field of dispute resolution…. Ever.
“The creation of the Institute of Family Law Arbitrators in 2012 provides couples with the opportunity to choose arbitration regulated by Arbitration Rules and affiliated to the Chartered Institute of Arbitrators. There has been no more significant development in the history of Family ADR.” Sir Mathew Thorpe
I feel that a process that can add to the empowerment of a couple navigating divorce, by becoming an additional resource to call on during the mediation process if and when required – rather than to take their power away and hand it all over to a judge – has got to be a process worth taking seriously.
Family Arbitration provides a flexible and cost-efficient means of resolving disputes. There is no “one size fits all” approach; the nature and number of hearings is tailored to the particular case. Family Arbitration can deal effectively with all cases, from those where absolutely everything is in dispute to those where only a few minor issues remain. Family Arbitration is ideal for those cases where the parties wish to retain control over the timing and cost of the process but nevertheless need someone to decide the case – or parts of it – for them. The procedure being tailored to each individual case, it is extremely time and cost efficient.” David Walden-Smith MCIArb, Barrister & Family Arbitrator
Family law solicitors – friend or foe?
So are family law solicitors going to support the education of their clients with regard to accessing Arbitration – or are they going to effectively hinder the process?
Arbitrator Olive McCarthy believes that a setback to the scheme is that unfortunately other family solicitors have yet to embrace the revolutionary process and its benefits. “Arbitrators believe this maybe through a fear on the part of solicitors that they will lose out by referring to Arbitration. However, clients need representation and advice in the process. Another fear they may have is that if an award favours one client, the other client may complain about the choice of Arbitrator if their solicitor nominated the Arbitrator. However, The Institute for Family Law Arbitrators (IFLA) can nominate an Arbitrator instead.”
Olive thinks that solicitors may be unsure as to what happens in the process and do not want to look inexperienced in front of their clients. She reassures them: “It’s similar to a First Appointment in financial remedy proceedings but can be adapted so as to suit the circumstances of the case. Nothing to fear!”
David Hodson OBE, Partner at The International Family Law Group LLP, was the originator and one of the creators of the English family arbitration scheme, and one of the first trained. He says: “It took 10 years for family arbitration to go from a good idea through to possibility then to reality but it has arrived at just the right time. With the dramatic cutback in legal aid, ever increasing legal costs, real delays in having cases heard in court and with many people wanting a more flexible and adaptable system for resolving disputes, this is really a good time and opportunity to use family arbitration. Many have already done so and have felt it has been a beneficial experience and outcome. It should be considered by many people and their lawyers.”
James Pirrie of Family Law In Partnership is a staunch supporter of Arbitration and is frustrated by the lack of support from other divorce professionals:
“My experience is that we try much harder as arbitrators and work with fine scalpels instead of the meat cleavers that are more often in evidence at court just because of the pressures of the court list. I find it infuriating that the resistance to stepping into arbitration so often comes from the divorce professionals. In their daily lives, those professionals struggle within the court system to deliver principled, efficient, careful and affordable outcomes to their clients but they don’t take the step over the threshold into arbitration which is the system that would enable those goals to be delivered so much more easily.” James Pirrie, Solicitor, collaborative lawyer, arbitrator, mediator & Board member Resolution
I think it will be interesting to see how many Family Law Solicitors in the UK will recommend Financial Arbitration as a good option for those couples who are struggling to come to an agreement on a financial or legal issue.
As is the case with Mediation and Collaborative Law, I feel strongly that it is the general public who need to be more aware of the options open to them, and not wait for the legal profession as a whole to embrace another great tool in the toolbox of a non-adversarial divorce or separation.
The benefits are summed up clearly and in plain-English here by Mediator and Arbitrator Nadia Beckett of Beckett LLP in this short video, and even to a non-legal person, the benefits do seem to be overwhelmingly clear:
For more information regarding Family Arbitration, refer to the IFLA website: http://ifla.org.uk/ or talk to Nadia Beckett about how an Arbitrator can positively impact on a mediated divorce.