Stowe comment: Arbitration v Court

As the Ministry of Justice releases family court statistics that show a 3% increase in new cases and an average 3-week increase in the time to reach a final order (2017 v 2018), it is clear that the courts are struggling to cope with demand.

To relieve some of this pressure, other alternative methods to reaching a resolve in family court matters must be more widely considered.

Faster and more flexible, family arbitration is one of the approaches that could help you and your ex-partner to make final and legally binding decisions whilst avoiding the over-stretched courts.

So how does arbitration work and what are the benefits? We asked Angela Sussens, Partner at our Leeds office to join us on the blog to explain further.

Arbitration is a form of dispute resolution and involves a third party (the arbitrator) adopting the role of Judge. The arbitrator will decide on the issues they are appointed to deal with after reviewing and hearing evidence from both parties in the same way that a Judge would at a final hearing.

When conducting an arbitration, arbitrators are required to apply the law of England and Wales. The arbitrator’s final decision is binding on both parties and is known as an Award (financial matters) or a Determination (children matters). The decision can then be embodied into a Court Order and submitted to Court for approval by a Judge.

To proceed with arbitration, both parties must agree that they are willing to proceed in this way. They are required to sign a document which sets out the rules of arbitration and by signing the document, the parties agree to be bound by the arbitrator’s final decision.

Neither party can subsequently decide that they do not want to arbitrate unless the other party also agrees to terminate the process. Once the arbitrator has accepted the appointment, the arbitration process formally begins. If there are Court proceedings, those proceedings will be put on hold to await the outcome of the arbitration.

The parties can jointly appoint an arbitrator or alternatively, they can elect for the Institute of Family Law Arbitrators (IFLA) to select one for them. There are separate panels for arbitrators who deal with finance or children matters but some arbitrators are members of both panels. Details of trained and accredited arbitrators can be found on the IFLA website. Those listed are experienced family law practitioners who have also completed the family arbitration training course.

How can an arbitrator help you?

Arbitrators can deal with most financial and property disputes arising from family/relationship breakdowns in the same way that a Judge can. Arbitrators are not however able to deal with financial matters where there is an issue over jurisdiction or cases involving the recognition of a foreign marriage or divorce.

Arbitrators can deal with many matters relating to children where the parties have parental responsibility including, but not limited to, where a child is to live, contact arrangements and decisions over education.

Usually, although not always, there will be an initial meeting between the arbitrator and the parties to agree on the steps needed to get the case ready. The arbitrator has the power to make case management and interim decisions such as deciding what evidence is to be provided and whether there is a need for expert evidence.

The arbitrator also has the power to make an order for one party to make maintenance payments to the other pending the outcome of the arbitration if the interim financial arrangements are not agreed.

After the final arbitration meeting, the arbitrator will issue an Award or Determination setting out their decision which is the equivalent of a final judgment and is binding on the parties. The parties are then required to apply to the court for an order replicating the Award or Determination. Only in very rare cases will an Award or Determination not be upheld.  The recent decision of Ambrose J in the case of BC v BG [2019] EWFC 7 reaffirmed this point

 ‘Any application to resile from an arbitration award should be unusual. Applications using the “notice to show cause” procedure or an application for no order to be made (as adopted in this case) should be exceptional for the reasons given in S v S and DB v DLJ’.

What are the benefits?

There are many benefits of arbitration when compared to the traditional court process.

Take less time

Firstly, arbitration is an opportunity to expedite the case and avoid lengthy court delays. It often takes the Court several weeks to issue an application and then a further delay is encountered when listing the matter for hearings. The parties and the arbitrator have total control over the timetable. There is also less risk of a hearing being adjourned or cancelled due to a judge becoming unavailable which happens increasingly often in court proceedings.

More cost-effective

Another benefit is that the arbitration process is often more cost-effective than the Court process although parties are required to meet the arbitrator’s fees which will vary from case to case.

The parties can also elect for arbitration to be completed on paper, if appropriate, which may further reduce costs.

Confidentiality

Confidentiality is also a benefit and arbitration is protected by strict confidentiality rules.

Greater control of the case

Arbitration provides the parties with greater control and flexibility over how the case is managed. The parties can define the scope of their arbitration and if there are specific issues in dispute, while other issues are agreed, the parties can limit arbitration to the issues in dispute.

The parties also decide when and where the hearings are to take place, albeit subject to the arbitrator’s availability. One of the main benefits of arbitration is the ability to appoint an experienced family law practitioner who will deal with the case from start to finish. There are a number of highly regarded family lawyers who are trained as arbitrators, thus giving the parties complete confidence that their dispute will be resolved by someone with the appropriate experience.

Arbitration in action

I was recently involved in an arbitration case dealing with the financial arrangements following the breakdown of the parties’ marriage. In that case, the parties agreed to use arbitration to resolve the issues in dispute between them. The arbitration process was concluded within c.16 weeks. It could easily have taken a year to reach a final hearing within the court process.

The final arbitration ‘hearing’ was dealt with in one day but is likely to have required two days in Court. Costs were contained after we were able to agree on the case management directions with the opposing party and the arbitrator thereby avoiding the need for an interim meeting or telephone appointment. The total costs were considerably less than they would otherwise have been if the matter was dealt with in the standard court process.

While arbitration provides a reliable and comprehensive alternative to the court process, it still involves handing over the final decision to a third party which is not ideal. If there is any scope for the parties to reach an agreement over the issues in dispute through negotiation, this will always be preferable to passing control to someone else.

Get in touch

If you would like some advice on arbitration and how it could help you please do contact me at angela.sussens@stowefamilylaw.co.uk

Details of all of our arbitrators and the work they do can be found here.

The post Stowe comment: Arbitration v Court appeared first on Stowe Family Law.


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Author: Angela Sussens

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