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25 NOV 2014

Family arbitration for 'DR dummies': An overview

Rhys Taylor

Barrister, arbitrator and mediator


Family arbitration for 'DR dummies': An overview
This article was written in support of Resolution's third Family Dispute Resolution Week, running from 24–28 November 2014.

This awareness-raising week aims to highlight the alternatives to court for separating couples and their families. Support the campaign on Twitter using #abetterway #ResolutionWeek and #familylaw


In 2012 the Institute of Family Law Arbitrators (IFLA) launched a scheme which provides for the arbitration of financial disputes following relationship breakdown after marriage or cohabitation. Arbitration is essentially private judging.

Why arbitrate?

Why was this step taken?

Have you ever had to wait an unacceptably long time for a final hearing and/or a judgment? Have you ever attended court to be told there is not enough time for your case to be heard? Have you and/or your clients ever found the court facilities and conference rooms to be wanting? Given the transparency agenda, have you amended your standard terms to provide a warning as to the possibility of publicity and does this cause any of your clients a concern? Have you ever nearly settled a case, but were left with one intractable issue which necessitated the complete Form E disclosure process to be worked through, just for that one issue to be canvassed by the court?

It is not just in the family arena that the court system has been found to be wanting. Andrew Richie QC makes a compelling argument for the need for personal injury claims to be resolved by arbitration. The cases of Mitchell v News Group Newspapers Limited [2013 EWCA Civ 1526 through to Denton & Others v TH White & Others [2014] EWCA Civ 906 have made the civil litigator’s lot a miserable existence. Serious consequences for family lawyers who do not comply with family orders are on the agenda: see Munby P in Re W (Strict Compliance With Court Orders) [2014] EWHC 22 (Fam).

The amended PD27A, in particular the requirement to only have documents which will actually be referred to in the bundle, adds a further level of front-loading- preparation and anxiety in the run up to a final hearing. The report of the Financial Remedies Working Group at para 28 proposes that all final hearings listed for 3 days or more should comply with the requirements set out in the Statement on the efficient conduct of financial remedy final hearings allocated to be heard by a High Court Judge . Whilst all of these onerous additional requirements are perfectly understandable from a judicial perspective, they leave the practitioner with further hoops to jump through, more to go wrong and more costs to justify.

The 'Overriding Objective' provisions in both the FPR and CPR require individual cases to take their place, given the other resource demands which are made on the court. Not so with arbitration, where the primary focus is the 'fair resolution of disputes by an impartial tribunal without unnecessary delay or expense' (s 1(a) of the Arbitration Act 1996). The arbitrated case does not have to jostle for hearing time alongside 'quick applications', injunctions and care cases.

In  J v J [2014] EWHC 3654 (Fam) Mostyn J noted at para [53]: 'if parties wish to have a trial with numerous bundles then it is open to them to enter into an arbitration agreement which specifically allows for that'. Whilst this may have been something of a tongue in cheek comment, it has a serious point: the additional requirements being placed on lawyers in order to assist an already overburdened judiciary are not necessary if the parties wish to adopt their own bespoke procedure in arbitration.

What’s this Arbitration Act about?

The Arbitration Act 1996 (the Act) may be unfamiliar to many family lawyers.

Its background is helpfully explained by Cardiff University academic Wendy Kennet . In short, the process rests on a contractual appointment of an arbitrator (via Form ARB1 under the IFLA scheme), whose decision the parties agree in advance shall be binding, subject only to any 'challenge' available under the Act, and in a financial remedy case, final approval by the court. For the court’s likely approach in a financial remedy case, see Munby P in S v S (Financial Remedies: Arbitral Award) [2014] EWHC 7 (Fam), [2014] 1 FLR 1257, at para [21]: 'It could only be in the rarest of cases that it would be appropriate for the judge to do other than approve the order.'

Grounds of challenge are set out in the Act at sections 67 (lack of jurisdiction), 68 (serious irregularity) and 69 (appeal on a point of law). Arbitration is not meant to darken the door of the court. However, the arbitrator, whose appointment rests upon a contractual basis has no coercive powers. Arbitration therefore takes place in the shadow of the law and parties to an arbitration know that the court can step in to support the process, in particular by granting a stay of competing legal proceedings commenced in defiance of an agreement to arbitrate the dispute (s.9), enforcement of the directions of the arbitrator, if required (s 42) the granting of a witness summons for people to attend before an arbitrator (s 43) and general injunctive relief (s 44).

Both the arbitrator (s 33) and the parties (s 40) have a duty to promote the fair and expeditious resolution of the arbitration, pursuant to s.1 of the Act. Sections 1, 33 and 40 are the triangulation points of the Act.

Whilst in commercial law the choice of substantive law is permitted (s 3), under the IFLA scheme this 'non-mandatory' section is disapplied, as all applications, must be determined in accordance with the law of England and Wales.

Section 4 and Sch 1 to the Act set out which parts of the Act are 'Mandatory'. Non-mandatory sections can be applied either by scheme rules and/or parties to suit their preferences. The IFLA rules set out a sensible scheme as to how the Act can work in the family context. The FamilyArbitrator website has published an annotated copy of these rules, in the style of the Red Book commentary.

Judicial support for arbitration

The judges have been very supportive of the idea of family arbitration and this scheme, See, for example:

Lykiardopulo v Lykiardopulo [2010] EWCA Civ 1315, [2011] 1 FLR 1427 per Thorpe LJ at para [69] 'is generally to be welcomed',

AI v MT (Alternative Dispute Resolution) [2013] EWHC 100 (Fam), [2013] 2 FLR 371 per Baker J (paras [31] – [37] approving generally), and

W v M (TOLATA Proceedings; Anonymity) [2012] EWHC 1679, [2013] 1 FLR 1513 (Fam) per Mostyn J 'much-to-be-welcomed scheme promoted by the Institute of Family Law Arbitrators'. 

Sir James Munby P stated in S v S (Financial Remedies: Arbitral Award) [2014] EWHC 7 (Fam), [2014] 1 FLR 1257 that an agreement to arbitrate under the IFLA scheme should be 'a single magnetic factor of determinative importance' (paras [18] – [19]) and 'There is no conceptual difference between the parties making an agreement and agreeing to give an arbitrator the power to make the decision for them' and an arbitral award was of its nature 'even stronger than a simple agreement between the parties'.(para [19])

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PartIV of the Financial Remedies Working Group report proposes streamlining the process for bringing a claim under the Arbitration Act to the Family Court, if required, and sets out in Annex12 best practice on the interface between the arbitration and the court.

The Jackson ADR Handbook cites the launch of the IFLA scheme under its 'Key Recent Developments' (page 7).

The Law Commission

The Law Commission in its recent report on Matrimonial Property, Needs and Agreements, whilst declining to propose that arbitral agreements should be considered to be Qualifying Nuptial Agreements, did state [7.40]:  'The advantages of arbitration over court proceedings are privacy and the ability of the parties to control the proceedings by deciding what the arbitrator is to adjudicate upon.' The paper submitted to the Law Commission by IFLA, which also explains the workings of the scheme and relevant case law in detail, can be accessed here.

Academic commentary and online guides

To date the most comprehensive (per Baker J in AI ‘eloquent’) explanation of the scheme and relevant case law has been written by Sir Peter Singer. Sir Hugh Bennet has also persuasively described the advantages of the scheme.

There are a number of very useful practical guides which are available.

IFLA have published a guide for clients and the legal profession.

The FamilyArbitrator website have produced a short Overview, Procedural Summary and useful (optional) checklists for parties and arbitrators to consider prior to signing the ARB1 and later at a first meeting with arbitrator.

Tim Scott QC published a very helpful introduction to arbitration.

You can find out how the IFLA scheme may hold particular advantages for those concerned in cohabitation/TOLATA disputes.

Nigel Shepherd has taken to YouTube to explain how arbitration works.

There is a LinkedIn Discussion Group devoted to family arbitration and you can catch most family arbitration news and developments via the FamilyArbitrator blog or the FamilyArbitrator Twitter account @FamArbOrg.

There are many other helpful materials out there, not all of which can be highlighted here.

How do I select an arbitrator?

You can find a register of all qualified arbitrators on the IFLA website. Parties may choose their own arbitrator to suit their particular dispute. If the parties, or their legal representatives, are unable to agree upon the identity of an arbitrator, IFLA will select one or select one from a shortlist.

Future developments

Two developments on the horizon.

At the helm of the first is Alex Verdan QC and Deborah Eaton QC, in describing the resolution of a privatechildren dispute by way of 'Early Neutral Evaluation'. Alex told the Resolution DR Conference 2014 that the parties agreed to appoint a private evaluator, having despaired of not getting on at the Central Family Court. The central idea is that the parties appoint a third party neutral evaluator by way of direction from the court, agreeing in advance that the decision will be binding upon them. The evaluator can hear the case and give a reasoned judgment which must then be returned to court for approval and conversion into an order of the court. This process sounds more closely related to arbitration than it does to 'early neutral evaluation' which is more commonly associated with a 'view' being provided after a review of the papers, not after the hearing of evidence. Either way, the development breaks new ground. Presently the IFLA scheme rules state that the resolution of private children decisions is beyond the scope of the scheme. However, with the Verdan/Eaton innovation, surely it is a matter of time before IFLA amends its scheme to provide for some private welfare disputes to be resolved in this way?

At the helm of the second is Felicity Shedden who is an exponent of a process called Med-Arb. This allows parties 'stuck' in mediation to move seamlessly into arbitration. The idea of having a single mediator and arbitrator in both roles can be controversial in England and Wales. However, in Canada for example, the experience has been that parties appreciate the benefits of one streamlined process. Presently, a process which enables the parties to know with confidence that if they cannot resolve their dispute with 'mediator A' then they will move straight into a binding arbitral process with 'arbitrator B' may be of real interest to those who use mediation or who have mediation based practices.


In terms of the books, Sugar and Bojarski’s excellent Unlocking Matrimonial Assets on Divorce has a chapter devoted to family arbitration by Sir Peter Singer. At A Glance also has a very useful introduction and procedural summary. Dennis Sheridan has published 'Family Law Arbitration' via the Law Society. You can read a review of his timely book here. Lastly, for a comprehensive review of the Arbitration Act, the most accessible practitioner text I would suggest is 'The Arbitration Act 1996: A Commentary'.