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Litigation v arbitration (a wry warning for cohabitants)

Date:27 NOV 2017
Third slide
Queen's counsel
Barrister, arbitrator and mediator

This article was first published in the August 2017 issue of Family Law and is republished to mark Cohabitation Awareness Week 

The scene is set in a barristers’ chambers in the heart of legal London. In the style of ‘The Long Johns’ (John Bird and John Fortune) an unfortunate client is about to hear the bad news about what is in store for him.

Barry Baffled: Sir George Parr, you are a leading family law silk. I need your advice about how to sort out a tricky matrimonial situation I find myself in.

Sir George Parr QC: When did you get married?

Barry Baffled:  I never got married.

Sir George Parr QC: Well why are you wanting my advice about a matrimonial situation?

Barry Baffled: I have lived with my partner for over 30 years and thought that made it a matrimonial.

Sir George Parr QC: Oh dear.

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Barry Baffled: Why are you tapping on your calculator?

Sir George Parr QC: No reason. 

Barry Baffled: I bought my house for £30,000 in 1987 and now it’s worth £2 million.

Sir George Parr QC: It must be one of your most valuable assets.

Barry Baffled: It’s my only asset. And now Betty’s saying she’s going to take me to the cleaners.

Sir George Parr QC: Has Betty said what she wants?

Barry Baffled: To go to court and get justice.

Sir George Parr QC: *Coughs*

Barry Baffled:  Why are you laughing?

Sir George Parr QC: I’m sorry, just choking a little. What does she mean by justice?

Barry Baffled:  She says she wants a fair recognition of all that she has done over the last 30 years by bringing up the kids and paying for all the groceries and stuff like that.

Sir George Parr QC: My dear man, nobody gets a fair result in this situation.

Barry Baffled: Eh?

Sir George Parr QC: There is no special law governing this situation. You just have to rely on property law and something called equitable principles. The law treats you as if you were sort of business partners.

Barry Baffled: But we were not business partners - we have lived together as man and wife for 30 years.

Sir George Parr QC: Well that’s not how the law treats you I’m afraid. Rather than bothering with fairness what the law really wants to know is what you both agreed about this property when it was purchased. When was it purchased?

Barry Baffled: As I said, 30 years ago, with my money from a £30,000 inheritance from my nan. And now it’s worth £2 million.

Sir George Parr QC: Well what were your intentions in respect of the property at the time you bought it?

Barry Baffled:  To live in it.

Sir George Parr QC: No aside from that, how did you intend to own it?

Barry Baffled: Eh?

Sir George Parr QC: Did you have any discussions with Betty at the time about how the property would be owned?

Barry Baffled:  Come on mate, you are asking me questions from another lifetime ago.

Sir George Parr QC: Yes, I know, the law requires it. What does Betty say?

Barry Baffled: After going to see Sue, Grabbit and Run she has sent me a letter saying that I said “Look here my dear, come and live with me and all of this will be yours one day.”

Sir George Parr QC: Well did you say that?

Barry Baffled: I haven’t the foggiest mate. It was 30 years ago. Can you remember what you said to your missus 30 years ago?

Sir George Parr QC: You see, if the court believes that you didn’t say that and accepts that you bought the house mortgage free with all your own money and in your sole name Betty may not be entitled to anything.

Barry Baffled: But that’s ridiculous.  Even I don’t think that’s fair!

Sir George Parr QC (Chuckling): Well, at the end of the day the court isn’t particularly interested in whether you think it is fair or not.

Barry Baffled: So, how am I going to get this sorted?

Sir George Parr QC: Well,

Barry Baffled: You are tapping your calculator again.

Sir George Parr QC:  Sorry. We will have go to court to have this resolved.

Barry Baffled: What, the Family Court?

Sir George Parr QC: No, the Family Court can’t hear these kinds of disputes.

Barry Baffled:  Why on earth not? This is about my family.

Sir George Parr QC:  That might be your perspective. I am afraid that they forgot.

Barry Baffled: Who, forgot what?

Sir George Parr QC: Oh, pretty much everyone really. When the Family Court was created a few years ago nobody thought to include people in your situation.

Barry Baffled: But I read in the Daily Mail that cohabiting outside of marriage is the fastest growing form of family unit in this country and you say everyone just forgot?

Sir George Parr QC: Yes, I’m afraid they did.

Barry Baffled: And when they realised the mistake why did they not fix it?

Sir George Parr QC: Oh, there’s no-one in the Ministry of Justice who has the time for anything like this.

Barry Baffled:  Why?

Sir George Parr QC:  They were all sacked on the grounds of efficiency.

Barry Baffled:  Hmmm. So where should I bring my claim?

Sir George Parr QC: In the county court nearest to where your former partner lives or where the property is situated.

Barry Baffled: I read in my local paper that they closed the county court near to where I live.

Sir George Parr QC: Yes, I believe they did. That’s most unfortunate isn’t it.

Barry Baffled:  So, where will these proceedings be heard?

Sir George Parr QC:  Oh, I’m not sure really. Maybe in some outlying county court or perhaps in the Central London County Court off the Strand.

Barry Baffled: But the Strand is about 175 miles away from my house.

Sir George Parr QC:  Well, it’s not all bad there. At least you may get a judge.

Barry Baffled: Eh?

Sir George Parr QC: In lots of outlying courts they don’t like hearing cases.

Barry Baffled: Why?

Sir George Parr QC:  Combination of factors really. Not enough judges to do the work now that they are swamped with litigants in person. To get through their lists they mainly hope that the tricky stuff will just settle. Sometimes you turn up and there isn’t a judge there at all.

Barry Baffled: Well that seems preposterous

Sir George Parr QC: Yes it is. Sometimes when they pull the plug they tell you the day before.

Barry Baffled: But lawyers will have been instructed and paid for by then.

Sir George Parr QC:  *shakes head sorrowfully* Yes, the brief is indeed incurred

Barry Baffled: So what happens when the case comes round again? I have to pay twice?

Sir George Parr QC:  I am afraid that is the case. It is not the lawyers’ fault there are not enough judges.

Barry Baffled: I assume that there are expert property judges then?

Sir George Parr QC: Yes

Barry Baffled: Who will eventually hear my case?

Sir George Parr QC: No. No I afraid not

Barry Baffled: And why is that?

Sir George Parr QC: Well our property judges are not always allowed to. They tend to sit in a special tribunal and just hear arguments about the title to property.

Barry Baffled: Does that involve the same arguments as we have to make in court then?

Sir George Parr QC: Yes, but at the end they are just not allowed to make any orders which help the parties determine the shares of ownership or sale or anything like that.

Barry Baffled: But that’s crazy

Sir George Parr QC: Well, now that you mention it, I suppose that it is.

Barry Baffled: So, will a judge who hears my dispute know anything about property law.

Sir George Parr QC:  It depends.

Barry Baffled: On what?

Sir George Parr QC:  On who you get on the day. It seems as if they often give the tricky stuff that will not settle to the part time judges. It’s a bit like pass the parcel. It depends on who comes in on the day of your case. When the music stops, so to speak.

Barry Baffled:  And how quickly do they make a decision?

Sir George Parr QC:  I’m afraid that depends as well.

Barry Baffled: Don’t tell me, on who I get.

Sir George Parr QC:  Yes, how did you know that?! It can take anything from a few days to about a year generally.

Barry Baffled: And what about Bettina and Belinda?

Sir George Parr QC: Who are Bettina and Belinda?

Barry Baffled: Our 13 year old daughters. Betty says she is going to make a claim under some schedule or something.

Sir George Parr QC:  You mean Schedule 1 to the Children Act 1989.

Barry Baffled: That’s the one. Will the county court deal with that at the same time?

Sir George Parr QC: No.

Barry Baffled: Why ever not?

Sir George Parr QC:  Schedule 1 to the Children Act is a family matter. It must be heard in the Family Court.

Barry Baffled: So, you are telling me that one court cannot hear all of this at the same time.

Sir George Parr QC: Well, we will look for a court building that houses both a family court and county court and we try and find a judge who can deal with both at the same time.

Barry Baffled: But that court has been closed down

Sir George Parr QC: My dear man, we will find another that has yet to be closed. Don’t worry.

Barry Baffled: Betty says this is all going to be heard in open court, is that true

Sir George Parr QC:  Hmmm

Barry Baffled: What do you mean, Hmmm?

Sir George Parr QC:  Well your property dispute should be in open court but the children matter should not be.

Barry Baffled: But I thought you said they could be heard together

Sir George Parr QC:  I did say that didn’t I?

Barry Baffled: How long does it take to get a circus like this through to a final hearing.

Sir George Parr QC: Oh, months, sometimes years.

Barry Baffled:  Why does it take so long?

Sir George Parr QC:  Litigation is like a Rolls Royce Mr Baffled. It does not just come off the production line. There are lots of complicated and, if I may say so, rather beautiful steps to the dance.

Barry Baffled: Eh?

Sir George Parr QC: Well, some big wig a few years ago decided that you needed to work out what you were going to spend on the litigation before you even started. That takes time and money to calculate.

Barry Baffled: How on earth can you guess how much it will cost - surely it will depend on how Betty’s solicitors play things and how long it takes to get called on?

Sir George Parr QC: That’s right, so we simply assume the worst case scenario and budget for that.

Barry Baffled: But things may not end up as a worst case scenario.

Sir George Parr QC:  I know that, but we have to budget for it, just in case. Otherwise you may not recover your costs.

Barry Baffled: So, you are saying that at the start of the case you have to spend a couple of thousand pounds filling out a pointless schedule which lists the worst case scenario even though that may not happen?

Sir George Parr QC: Yes.

Barry Baffled: And does the other side have to do the same thing?

Sir George Parr QC:  Oh yes, each side does them and then compares and usually then agrees them to avoid having to argue about them.

Barry Baffled: Please tell me that there is no more pointless money wasting to contend with.

Sir George Parr QC: No

Barry Baffled: “No” there is no more money wasting?

Sir George Parr QC:  “No” I am afraid there is.

Barry Baffled: What does that involve?

Sir George Parr QC: Well, we all like to have a look at just about any financial document either of you have generated over the last 30 years. It often fills boxes of information.

Barry Baffled: Why on earth does it have to be that invasive?

Sir George Parr QC:  Funnily enough, it does not. The Civil Procedure Rules allow for light touch disclosure but most judges like to see a proper job being done, to give a fair trial and all. Rolls Royce dear boy.

Barry Baffled:  How is it fair to bury me in documents and expense when I thought all you wanted to know was whether or not Betty said what she said she did all those years ago?

Sir George Parr QC:  Don’t be getting all despondent like that. You will have a team of highly qualified lawyers poring all over this. Fine minds will leave no stone unturned.

Barry Baffled: How much will this all cost?

Sir George Parr QC:  North of £100,000. Each.

Barry Baffled: Might the budgeting figure come up with anything else?

Sir George Parr QC: Unlikely, and then there will be the Schedule 1 costs to deal with on top of that.

Barry Baffled:  Is there a better way of trying to resolve all this?

Sir George Parr QC:  You could try mediation.

Barry Baffled:  We did and we were there all day but we couldn’t agree it. She was saying one thing and I was saying something.

Sir George Parr QC: There is a new fangled thing called family arbitration, but I would not advise you try that.

Barry Baffled: Why not?

Sir George Parr QC:  Because it’s new and, on the whole, I do not like things that are new to me.

Barry Baffled: But surely the fact something is new is not a reason to reject it out of hand?

Sir George Parr QC: In your books perhaps.

Barry Baffled:  I’ve just looked it up. It says that you can choose your own specialist tribunal who can hear both the property and children aspects of a dispute at the same time. It says that the parties can craft a procedure with the arbitrator which will be proportionate to the dispute in hand and that you do not have to slavishly follow court procedure. It says that the costs of the arbitrator are probably cheaper than waiting for months whilst the parties exchange unpleasant correspondence and the case waits to come on. It says that it is ideal for family lawyers who want to help their client resolve tricky property disputes with the assistance of a tribunal who understands both property and family law. It says you can more than recoup the costs of the arbitrator by resolving matters quickly. What’s not worth trying there?

Sir George Parr QC:  It’s not how we do it. Period.

Barry Baffled: Sir George Parr, thank you very much.

Sir George Parr QC: It’s a pleasure, thank you.