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What is family law arbitration?
Family law arbitration is a type of dispute resolution which can be used in family law cases to resolve things such as financial disputes and issues surrounding children. Arbitration can be used at any stage but is particularly useful in cases where parties could not reach a mutually agreeable solution, whether that is via mediation, direct discussions, or through negotiations with their respective legal advisors.
A form of judging, arbitration takes place in private, with both parties agreeing to enter into the process who then choose and appoint an arbitrator together. If parties cannot come to an agreement about whom to appoint as an arbitrator, they can ask the Institute of Family Law Arbitrators (IFLA) to make the choice for them.
The IFLA has over two hundred arbitrators on their panel who are all family law specialists. Arbitrators tend to be retired court judges, solicitors or barristers.
Benefits of family law arbitration
1. Choice
Both parties can decide whether to engage in the process and who they appoint as an arbitrator. This is in direct contrast with court litigation where parties have no say on the judge allocated to their case. As well as being able to choose an arbitrator, the parties can control when and where the arbitration takes place. This can be in a solicitor’s office, barrister’s chambers, a neutral conference or meeting room, or even via video conferencing.
Because family law arbitration is a tailored process, there is scope for the arbitrator to decide every issue, or only adjudicate on one or two outstanding matters. Parties can also choose which elements of the dispute the arbitrator can rule upon.
2. Speed
The court system can include delays, both at the beginning of proceedings and throughout ongoing cases. As well as the delays, cases can be ‘bumped’ by a more urgent hearing or because there is a shortage of available judges to hear the matters listed. Arbitration therefore enables parties to avoid delays of the court system by going down a private route and seeking an arbitrator’s award within a set timescale.
3. Cost
Both parties will need to pay an arbitrator’s fees and expenses, and potentially the cost of any venue hired for the arbitration to take place. That said, the process is streamlined and a lot quicker than court proceedings. This means that parties can often effectively contain or reduce their costs because matters are resolved with greater efficiency and speed.
4. Confidentiality
The whole process takes place privately and is entirely confidential. Parties can therefore be rest assured that the details of the case cannot be reported, which, compared to certain elements of court proceedings, could, in theory, be reported by the media.
What is the process?
The process can be easily broken down into simple stages:
- Both parties should agree to use arbitration and choose an arbitrator that is suitable, qualified, and experienced. The arbitrator should also be available and have enough capacity to take on the case.
- Both parties should sign and submit their Application for Family Arbitration (Form ARB1) which discloses the issues they are seeking to resolve and includes details of the dispute. Both parties must agree to be legally bound by the arbitrator’s decision.
- The arbitrator will then contact the parties to arrange an appointment.
- Telephone calls and/or meetings are held with the arbitrator before a final meeting is scheduled between both parties, their legal representatives, and the arbitrator.
- Fees are paid, including any venue hire costs.
- The arbitrator will send a letter to both parties detailing their decision and the reasons for arriving at it.
Arbitration can be done in the style of a structured ‘hearing’ with or without oral evidence from the parties or, alternatively, done on paper. This means that both parties’ and their legal representatives make written submissions to the arbitrator who then determines the issues based on these without the need to see anyone in person.
There is also the option of using an ‘early neutral evaluation’, which is principally the arbitrator’s early non-binding view on all or part of the issues in dispute. This tends to be done on paper and often assists the parties in both negotiating and achieving a settlement without further determination by the arbitrator.
What does it cost?
In family law arbitration, there are four main types of cost.
- The arbitrator’s fees and expenses: These tend to be agreed at the beginning of the arbitration process, with the typical arrangement being each party shares the arbitrator’s fees and expenses equally between them, if they both have the funds to do so.
- Venue hire: As mentioned above, there may be costs involved in hiring the venue for meetings which form part of the process, such costs are generally shared equally.
- Legal costs: Costs will be incurred by both parties in instructing lawyers to prepare for and represent them in family arbitration. The arrangement tends to be that each party pays their own legal fees.
- Experts’ fees: This could be an accountant or pension advisor, for example. In most cases, costs will be shared equally.
It should be noted, the arbitrator has the power to make an order for one party to pay more than an equal share.
What is court litigation?
Litigation is the process of taking a dispute to court and happens when parties cannot agree between themselves about the outcome of a dispute, so they will ask a judge to determine it for them. It can be a long and complex process.
Overview of the court litigation process
Financial proceedings:
In most cases, there are three stages to the court process. The first hearing is essentially an administrative hearing where the court considers what information it needs to be able to decide what the final outcome should be. The second is a Financial Dispute Resolution (FDR) hearing, where the court is given a summary of both parties’ positions and asked to indicate what the final outcome should be. If the parties do not agree before the next court date, a final hearing will hear evidence from both parties and the judge will make a final decision.
Children proceedings:
The procedure for Children Act proceedings can vary depending on the application being made and the circumstances of the case. A first hearing dispute resolution appointment is the first hearing parties will attend. The court will decide whether any further information is needed, such as getting an expert report to assess what is in the child’s best interests. More recently, there has been a move towards the first hearing being used to determine the issues of the case, but this depends on whether this is appropriate to the case at hand. A dispute resolution appointment will follow to try to narrow the issues, consider any expert evidence and decide whether any circumstances have been raised that need to be considered in a separate hearing. A final hearing will then be arranged where the court will hear evidence, and if appropriate, make a final order.
Key differences between family law arbitration and court litigation
- The main difference between arbitration and litigation is that the court is involved in litigation, whereas in arbitration, a settlement is reached between the parties privately.
- Arbitration is a way to resolve the dispute where a neutral third party is appointed to listen to both sides and decide an outcome. On the other hand, litigation uses a strict procedure on which a judge decides the outcome based on legislation and a set of legal principles.
- Arbitration is always civil and collegiate, whereas litigation tends to be more blunt and confrontational.
- Arbitration is a private way to resolve disputes, where complete confidentiality is absolute. However, litigation can be made public and reported on in some instances.
- The cost of the arbitration process is comparatively less than litigation.
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