Private FDRs: a progressive move

As we emerge from covid-19 and, hopefully, our final lockdown, we will look back on a turbulent year, learn from the experience forced upon us and from the workplace adjustments we had to make. 

The court service has struggled, just like other organisations; particularly so when it was already under immense strain. Here, I focus on the impact upon the financial remedy court (FRC) and financial dispute resolution hearings (FDRs).

Recently, I decided to leave judicial office after 10 years, which had followed private practice as a family solicitor and family mediator. Thus, I have experience as a practitioner and a court user, then latterly as a decision-maker within the judiciary itself. This includes during and post-covid-19 with all the problems that created. With a new private FDR business, I now have a different perspective. 

So, what happened to the FRC after covid? 

The usual sequence in financial remedy proceedings is the first directions appointment (FDA), FDR and then the final hearing. By the FDR stage, there should be sufficient information available to focus on settlement with the court’s assistance and which, if successful, ends the litigation.

Triaged cases

From 20 March last year, these cases were either cancelled or listed remotely and subject to a new triage system where judges first considered whether they were suitable for remote hearing and whether they could be heard as scheduled. 

Telephone and video hearings take longer mainly due to setup arrangements. Sequential and not bloc listing is required; gaps between hearings and IT issues are inevitable with remote litigation, so they do need additional time. Many hearings, including FDRs, had to be adjourned – often at short notice. That meant a long time before relisting, so this meant even longer again until trial (if one was required).

Parties were encouraged to use the fast-track system for FDAs and to agree Directions in correspondence. At the other end of the process, final hearings were initially vacated and pre-trial reviews (PTRs) or ‘ways and means’ hearings were introduced to address how the final hearing would now proceed. 

As covid-19 progressed and we all adapted, it became increasingly clear that in person final hearings could be more than a year away and that remote final hearings must be considered. It is now accepted that most financial remedy trials can take place effectively by video if they cannot be accommodated in court, although not without their challenges. Judges will obviously have to be satisfied of a case’s suitability in each situation.

Private FDRs welcomed

What became clear is that long delays remained likely for some time, even if in person hearings are now returning. So, with hearings adjourned (and possibly more than once) there was added incentive to settle and to explore alternative dispute resolution. Litigants were reminded of private FDRs as an option, some courts adding this as information to post-covid orders. The ongoing message from the judiciary is that the use of private FDRs is welcomed.

In principle, FDRs are important. I haven’t heard of any practitioner who doesn't support them and their objective of finding a solution to avoid trial, with the aid of an indication from a specialised FRC judge as to a reasonable and likely outcome should the case not settle – and all in confidence, so that participants are able to negotiate freely. 

At this point, evidence is not heard and nor are the issues determined by the court. Rather, the focus is on progress and settlement. An independent view from a judge at this stage, one who is experienced in determining these cases, is invaluable to the negotiation process. What’s not to like? 

At worst, there is an opportunity to test the case and bargain; and maybe an unwelcome view on your case from the judge and/or no agreement being reached. But focus is then on what has to be addressed x and arrangements are made to progress to trial. At least closure is in sight, while negotiations can continue. 

At best, a final agreement is reached, trial is avoided and costs are saved. 

As a former deputy district judge and district judge on the FRC, I have conducted FDRs over and over again and seen their value in practice. But I’ve also seen the limitations in court (as set out below) especially in the last year. Private FDRs have become more attractive because they avoid these problems. 

They will also take some pressure off the court service the more widely they are used. This can only help the system and those cases remaining within the system. On leaving judicial office, I was convinced I could conduct FDRs more effectively on a private basis, pandemic or no pandemic.

The courts

There has been much talk of crisis in the court system long before the arrival of covid-19, with lengthy delays and backlogs being common features. It doesn't take much of a leap to imagine the impact of covid-19 on that service, on judges and on support staff. 

There have been court closures and adjustments; social distancing measures and occupancy limits; new protocols and covid-19 orders; the conversion to remote hearings overnight and the challenges they present; cancellation of cases that could no longer be heard as planned; cases transferred to different courts for hearing and files in regular transit; new IT systems and hearing platforms; staff shortages; court offices deluged with emails and constantly moving goalposts as the pandemic developed. No, not much of a leap at all – and most litigation practitioners will have experienced the knock-on effect themselves.

It has been particularly hard on family litigation. This is because when families were already suffering the breakdown of their family unit – when the pandemic may also have inflicted damage on those families – they may well have also faced delay or disruption to their case.

Financial remedy is only part of the family justice system and importantly, child cases or cases where there is risk of harm are prioritised and heard as soon as possible. However, limitations still existed. This is, of course, in addition to the civil and criminal law systems which have also been injured by covid-19.

I have only admiration and respect for judicial colleagues who continue to give their loyal service, working under increased pressure, with the return to normality (in itself arduous) still uncertain.

Time 

Time is a luxury the court simply does not have enough of. FDRs are usually bloc-listed with several other cases, typically allocated only an hour – and cases tend to run over. There is a lot of waiting and less judicial hearing time, even less again for judges to read the papers. 

And that is assuming they receive them all before the hearing – a particular difficulty during covid-19. The parties and their legal representatives use the opportunity while in court to negotiate and can come back before the judge, but judicial availability is still limited.

Time will also have to be spent on Directions because if there is no settlement, preparations have to be made for trial; and there is usually insufficient time for the court to hear lengthy submissions over disputed Directions.

It can be surprising how much time these take if they are not agreed. Judges are acutely conscious of timescale as other cases will be waiting. They will urge the parties to agree Directions and, of course, focus all minds on reaching a final settlement. They will also want to have as much information as possible to give a reliable view at FDR, so they will be hampered if information or documents are absent, not ready, filed late or – frustratingly for all – filed but not yet with the judge.

Without the necessary documentation, the FDR may be aborted. This screams waste, cost and delay. 

Completing this process remotely adds further hurdles, including a time element to be factored in as everything takes longer. 

Rushing an FDR feels uncomfortable, especially considering the effect on the parties. It is, after all, their case, their financial arrangements at stake and all at their cost.

Naturally, only their own case matters to them. They expect to be given the time they think their case needs and will probably be naive to the reality and the understandable limitations of the court system.

My experience is that judges and court staff work incredibly hard in the administration of justice, but because the court service operates under such huge demand, parties do not always receive the experience and time they hope for.

Private FDRs compared

A private FDR offers ample time. It is usually scheduled for a whole day with the judge which is used exclusively for that one case. There are no adjournments or delays, no other distractions and all the information is received by the private FDR judge well in advance. 

This means nothing is left to chance or until the last minute, save for the inevitable late developments in the case. Instructing solicitors will ensure this is so – their clients pay for the service which they have both chosen; all those involved have the day reserved for the private FDR; and they want to ensure it is as effective as possible. 

Yes, there is a charge but it is cost effective. Attendees can be reassured that the private FDR judge will have had time to read all the papers and their case will have the judge’s undivided attention for the day – not for merely an hour, not in between other cases and not with ‘a million and one’ other things to juggle during that time. 

Private FDRs take place in the same way as in court: by telephone, video or in person. But the FDR judge, the time, place and hearing platform are decided by the parties themselves, not the court.

Private FDRS carry the same weight and value as court-based FDRs. The private FDR judge may be a part time or former judge (though they don’t have to be) who has conducted such cases themselves, so the parties benefit from a judicial, or at least an experienced view as to a reasonable and likely outcome of the case, to assist their negotiations. 

They may not agree with that view. They are neither bound by it nor obliged to settle, just as with a court-based FDR. And as with any financial remedy case, there is no guarantee of settlement at the FDR or of the outcome at trial. It is an expensive risk proceeding to trial, hence the focus is on settlement now.

But the parties attend a private FDR because they want to, which tends to mean achieving a settlement is forefront in both their minds. If terms are agreed, they will file a consent order with the court for approval as only the court can make an order.

But if terms are not agreed, it won't be for want of trying; and the parties will continue to negotiate just as they would after a court FDR. They will file agreed Directions with the court to prepare for trial and if those are in issue, the court will decide them. 

In effect, the court timetable resumes and the case is listed for trial in the usual way. In court, the without prejudice FDR paperwork is removed from the file so the trial judge (who cannot be the FDR judge) does not see it. That is not a factor with private FDRS.

A good job now

Life didn't turn out as planned after my district judge appointment, but then who among us anticipated a pandemic and its impact? It certainly ruined my judicial experience. 

Like all judges I have met, I care about every case I deal with. But what I have learned most is how important it is for me to do a good job and that I am not willing to feel compromised in that objective.

Starting a private FDR business seemed an obvious next step for me, using what I know about financial remedy work, having control over my time and being able to focus exclusively on each case. It is my own very small contribution to family justice today.
 

Orla O’Hagan is a former district judge and now runs The Private FDR Service www.privatefdrs.co.uk 
 

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