Financial Dispute Resolution

This week’s blog is brought to you by Laura Dawson pupil to Philip Morgan

Private FDR’s what are they and are they useful:

One of the stages of a matrimonial finance application is the Financial Dispute Resolution hearing or FDR. Normally at an FDR you have to attend court at a set time and a Judge will provide their indication of the likely outcome at a final hearing. The aim is for the parties to try and reach an agreement to save further court time and costs.

A private FDR is a voluntary hearing, as opposed to a compulsory one. The parties are normally there by agreement and are invested in trying to reach an agreement if possible. Because of this the parties are more likely than not to reach an agreement.

What are the advantages to a private FDR?

The pressure on the courts is increasing and therefore cases are taking longer to get to a hearing, in addition Judges are being allowed less time to hear cases and therefore consider them. The time from the first hearing in court to FDR can take months, this drives up costs and extends the tension and stress for the parties.

FDR’s have their limitations, because court lists are congested, there is usually a considerable delay before the FDR takes place. As with other court hearings the parties do not have the power to choose the Judge, in addition most Judges assigned to an FDR case have not had time to fully read the papers.

Private FDRs are an answer to these problems. They are done privately and voluntarily at a time convenient to all parties and so they do not have to wait for a hearing date. This means that an agreement could potentially be reached earlier that if the parties had to wait for a court date.

Another advantage of a private FDR is the savings in terms of time and legal costs. The rate of settlement at an FDR is good, the settlement rate for private FDR’s is even better.  This is mainly due to the fact that private FDR’s offer guarantee of privacy and a dedicated ‘Judge’ for the entire day. The individual hearing the FDR would have had ample time to read the papers and there would be adequate time allocated to hear the case so nothing seems rushed.

The date and location of the private FDR can be agreed between the parties, a court environment can be stressful and make parties anxious. Being able to choose the venue, date and time of the private FDR puts parties at ease which altogether make the process a lot less stressful than a formal court appearance and leads to higher likelihood of the parties reaching an agreement.

In addition, the individual hearing a private FDR will read and consider the papers, hear the parties positions and give a neutral evaluation of the likely outcome. This means that the FDR is heard by an independent expert. Many people settle their whole case at this point because parties know what they stand to gain or lose.

Additional benefits of a private FDR are that they can happen before court proceedings are started or at any stage during the court process, hearings can be arranged quickly and held remotely by video or telephone. The parties have the power to choose someone in whom they have confidence. The FDR process can deal with all or any of the aspects of the dispute which the parties wish so can essentially be tailored to the parties needs.

However one of the disadvantages of a private FDR is that there is no power to impose a settlement as opposed to an FDR which is something to be consider by parties when deciding whether to go for a private FDR or not.

However, many legal partitioners and Judges alike are recommending private FDRs as an alternative to a traditional FDR hearing. Private FDR’s are certainly being considered as a way forward and judging by the advantages of such hearings it is not hard to see why.