The advantages & disadvantages of private FDR

By Vanessa Lloyd Platt
Lloyd Platt & Co

When dealing with financial matters arising out of a divorce, there are many methods that can be utilised to resolve cases. There has been definite uptake in mediation, but it does not always resolve matters between spouses.

One of the methodologies that has been used more increasingly over the last few years is that of the private financial dispute resolution hearing or FDR.

When an application is made to the Court, it sets in motion a process. A Form A can be issued which will trigger the first hearing known as a First Appointment. Sometimes the parties can voluntarily agree to bring forward timetables so that the First Appointment can be converted into a second hearing known as an FDR or financial dispute resolution hearing.

This is a hearing where the parties try to resolve financial matters directly, or if voluntary disclosure has been unsuccessful in bringing about a final resolution. The hearing is where a court will attempt to assist the parties on a without prejudice basis in reaching a financial settlement and are very often successful.

Court Based FDR

The problem with a court based FDR is that the Courts these days are so overwhelmed with cases, which can lead to a huge delay in obtaining a court date. Parties can find to their horror that there are several other cases listed on the same day, with a very complex matter, leaving a Judge very little time to understand what the case is about or read through all the documentation that has painstakingly been prepared.

If cases are dealt with remotely on Teams or Zoom, court-based Judges have only a very short period before the case comes on. Sometimes a court-based appointment can turn out to be an entire waste of time when a Judge has no time to read the papers and simply sets the matter down for a final hearing.

Private FDR

A very sensible alternative for parties to avoid these issues and bring forward the timetable is to invest in a private FDR. A private FDR is one where both parties jointly pay for a Judge, usually retired Judge or barrister to act as the private FDR Judge. The parties can jointly choose the Judge who might be more familiar with the circumstances of the case i.e. familiar with for example farming cases, businesses or property.

Agreement is made as to the Judge once their costs have been assessed and the hearing, similar to that of arbitration, will take place away from a court setting in a more conducive atmosphere for negotiation. At least a day is set aside to maximise the hope of matters settling between the parties and the Judge will be available all day.

For the private FDR, the Judge will have read all the papers, seen the skeleton arguments prepared by both sides and will have a total understanding of what issues are between the parties. In addition, one further benefit is that a private FDR can be held before the need for any Court proceedings when there has been full voluntary disclosure which can save even more costs.

In a private FDR the lawyers present the arguments to the Judge as if they were in Court and the Judge suggests that if they were dealing with the matter, the parameters for settlement or some Judges can deal with suggested actual figures.

This will then lead the clients, together with their lawyers, to negotiate throughout the day to see if agreement can be reached. When it is, if this is possible, the agreement is drawn up there and then and signed by all parties and then approved by the Judge, without any need to attend Court. If agreement cannot be reached, then directions can be made.

The benefit of a private FDR is that there can be a huge saving in costs and time as the opportunity to settle matters are given absolute priority. If agreement cannot be reached, the case will proceed much more quickly than would have been the case if the case had gone to court.

The disadvantage of a private FDR is that there is no guarantee that the parties will settle at the point, and they would have expended money on a Judge that otherwise in the court system, they would not have expended.

If the private FDR is unsuccessful, the matter will still have to go to Court ultimately for a final hearing with the attendant costs. However, it is the view of this practice that if the parties are in a position to pay for a private FDR, it is well worth spending the money and with the expertise of the barristers used by this firm, most private FDRs do end up reaching a final and sensible settlement.

If you want to discuss any aspect of divorce and separation, please fill in our form below, call us on 0208 343 2998 or click to contact our divorce lawyers in London.

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