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Divorce and Dispute Resolution : Mediation and Arbitration

Family law and family Dispute Resolution is like its clients going through a rapid period of transition. Mediation has been around for a long time as an established form of dispute resolution for those who are divorcing or separating and have financial or children issues which need resolving but is now also being heavily promoted by the Ministry of Justice on all its self help websites.

However collaboration between Mediation and Arbitration is new and unchartered Territory. Historically Mediation has broken down where there has been a discreet issue which could not be overcome with the input from Lawyers. Now a referral to Arbitration can assist with this maintaining the non contentious approach to dispute resolution and being more time effective and cost effective bearing in mind court fees alone.

However it is often asked what is the legal implications of an outcome attained through mediation and the courts attitude to the same. Well we now have a case that assists us with this.

S v S [2014] EWHC 7 (Fam)

Application for approval of a consent order intending to give effect to an arbitral award following arbitration conducted under the Institute of Family Law Arbitrators (“IFLA”) scheme.

 

Background

The parties were married in 1986 and separated in 2012.  They had one child, aged 19. Decree Nisi (on the wife’s petition) was granted early in 2013.  In June 2013 the parties signed the IFLA’s Form ARB1, agreeing to arbitration in accordance with the Rules by Mr Gavin Smith (the arbitrator) in relation to their claims for ancillary relief and thereby binding themselves to accept his award.

 

The arbitrator’s Final Award is dated 7 November 2013.  On 9 December 2013 the parties applied to Guildford County Court seeking approval of the consent order.

 

Their D81s showed matrimonial assets to be worth in excess of £1.5m but less than £2m.

 

At paragraphs 7 – 15 the President examines the progression of the law concerning agreements reached in financial remedy proceedings.  Specifically he refers to the following:

 

[paragraph 11] the concept of the ‘magnetic factor’ – the feature(s) or factor(s) which in the particular case are of ‘magnetic importance’ in influencing or determining the outcome (White v White [1999] Fam 304, Crossley v Crossley[2007] EWCA Civ 1491).

[paragraph 12] mediation and other forms of alternative dispute resolution being well established as a means of resolving financial disputes on divorce.
[paragraph 13] the court’s abbreviated processes to facilitate the appropriately simple and speedy judicial approval of such agreements.

[paragraph 14] the court’s sanctioning of the ‘notice to show cause’ procedure and the respect a court should give for individual autonomy.

 

The President then examined the future of an arbitration award made under the IFLA Scheme. He stated at paragraph 18 that the starting point in the process of approving a consent order should be that where the parties have bound themselves (by signing a Form ARB1) to accept an arbitral award this generated a single magnetic favour of determinative importance.

 

At paragraph 21 he says:

 

“The judge will not need to play the detective unless something leaps off the page to indicate that something has gone so seriously wrong in the arbitral process as fundamentally to vitiate the arbitral award.  Although recognising that the judge is not a rubber stamp, the combination of (a) the fact that the parties have agreed to be bound by the arbitral award, (b) the fact of the arbitral award and (c) the fact that the parties are putting the matter before the court by consent, means that it can only be in the rarest of cases that it will be appropriate for the judge to do other than approve the order.”

Where a party seeks to resile from the arbitral award the President stated that the other party’s remedy is to apply to the court using the ‘notice to show cause’ procedure.  The court would adopt an appropriately robust approach taking into account the arbitral award.