Fiducia Wealth Management
Posted in Pensions & Retirement, Pensions & Divorce on 12.12.11

Jon Armstrong – Armstrong Family Law

Couples going through divorce proceedings often assume that disputes about property, assets, and maintenance have to be resolved by the court. However, more and more couples are using alternative ways to resolve their disputes.

The first step for anyone who is intending to separate or divorce is to instruct a solicitor, preferably one who specialises in family law and who is a member of Resolution, an organisation whose membership complies with a code of practice committing them to resolving disputes in a constructive manner.

Sometimes, the husband and wife have managed to reach an agreement directly between themselves. The solicitor will advise his or her client whether or not that agreement achieves fairness and meets the client’s needs. He or she can only advise the husband or wife and the other party should seek their own legal advice. If agreement is then confirmed between the solicitors, they will then prepare a financial consent order reflecting the agreement and then submit it to the court for the approval of the district judge.

More often, the husband and wife will need to go through a process involving negotiation between solicitors and if that is unsuccessful, litigation through the court. Both sides provide documentary evidence of their current financial circumstances and then engage in negotiations designed to reach an outcome that achieves fairness and meets the needs of all parties and their children. The vast majority of cases are resolved in this manner without the need to set foot in court.

If agreement cannot be reached, an application has been made to the court for a financial order. This is an extremely efficient way of ensuring that you receive a financial outcome, usually within four to eight months, sometimes longer. Both sides are ordered to file detail financial statements and questionnaires are then prepared by the solicitors setting out what further information or documents are required. A First Appointment takes place at the court during which the District Judge will consider whether or not the questionnaire has to be answered and will deal with other matters such as ordering valuations of properties if the value cannot be agreed.

A Financial Dispute Resolution Appointment (FDR) then takes place two or three months later. If agreement cannot be reached, the parties and their legal representatives go before the District Judge and ask him or her to provide an informal indication of how the court might resolve the dispute. This indication is not binding, but it is designed to encourage the parties to reach an agreement and to avoid moving onto the next step which is a trial before a different District Judge (who will be unaware of what has been in formally indicated by the district judge at the FDR). The vast majority of financial applications are concluded on or before the FDR and very few cases go to trial.

The court process is an extremely efficient manner in which to resolve matters. However, it is by its very nature adversarial and confrontational, and although most solicitors and barristers attempt to conduct cases in a constructive manner, the experience can be extremely bruising.

There are two alternatives to using the court to resolve matters. Firstly, the solicitors can refer the husband and wife to mediation. The mediator is an impartial and independent third party who helps the parties to reach an agreement. The mediator does not advise the husband or wife; that remains the responsibility of their solicitors. Nor does the mediator decide who gets what; the decision remains in the hands of the husband and wife.

If the husband and wife cannot reach an agreement in mediation, it will be necessary for one of them to make an application to the court for a financial order. However, if they are able to agree, the mediator then prepares a memorandum of understanding which is sent to their solicitors who advise them on it. If an agreement is then confirmed between the solicitors, they prepare a financial consent order for the approval of the District Judge.

Mediation can be cheaper and less confrontational than the court. It is not suitable in every case; for example, if there has been a history of violence in the marriage, the mediator would normally not be prepared to go ahead. However, where it is suitable, it is an exceptionally good way of reaching an agreement. It helps the parties to maintain and strengthen their working relationship, something which may be extremely important as if they have children, they will have to deal with each other for years to come. It also helps the parties to set the agenda and the pace at which negotiations proceed, rather than the court deciding what is relevant and the speed in which matters go ahead.

Alternatively, the husband and wife can attend to reach an agreement using the collaborative process. They would both be separately represented by their own collaborative family solicitors. The parties and their solicitors enter into a participation agreement to work together in a constructive and non-adversarial manner. A series of round-table meetings take place during which the solicitors help both parties to reach a solution. An essential part of the participation agreement is a commitment not to use the court.

If agreement is reached, the solicitors sort out the necessary paperwork and court order. If agreement cannot be reached, then one of the parties will need to make an application to the court for a financial order. However, the solicitors are barred by the participation agreement from continuing to act in the case and both the husband and wife would need to instruct new solicitors.

The collaborative process, like mediation, is a non-adversarial form of negotiation and is not suitable in all cases. It involves a great deal of seeing the other side’s perspective and encouraging clients to look at matters objectively and fairly. It is usually cheaper than litigating through the court and the parties can again set their own pace and agenda. For example, I have undertaken collaborative negotiations about the family’s dogs, including discussing where they lived and how often the other party saw them. The couple in that case did not have children and their dogs were incredibly important to them. I dread to think how a District Judge might have reacted if asked to decide the dogs’ future. Similarly, couples can spend time discussing how they divide the contents of the house; the court would simply refuse to spend time on this in most cases and might even threaten to order everything to be sold.

The key to achieving a cost-effective and fair result which meets both your needs and the needs of your children is to decide which of the above routes are right for you. All of them have their pros and cons. Your solicitor will help you to choose the right way forward.

 

Jon is a specialist solicitor, collaborative lawyer and family mediator at Armstrong Family Law

 

w: www.armstrongfamilylaw.co.uk 
e:jon@armstrongfamilylaw.co.uk
t: 01206 848426

 

The views in this article are those of the contributor and do not necessarily represent those of Fiducia Wealth Management Ltd.If you would like copies of any of these articles please contact Financial Adviser Gordon Kearney via email at gordon@fiduciawealth.co.uk or via the post at Fiducia Wealth Management, Dedham Hall Business Centre, Brook Street, Dedham, Colchester, CO7 6AD.

Fiducia Wealth Management
Posted in Pensions & Retirement, Pensions & Divorce on 12.12.11