Re X (Financial Remedy: Non-Court Dispute Resolution) [2024] EWHC 538 (Fam)8 March 2024

Published: 18/03/2024 11:15

Knowles J; impact of Churchill on family proceedings. Incoming changes to FPR from 29 April 2024 will enable court to adjourn proceedings for ADR with potential costs consequences for non-engagement.

There is currently no power in the FPR 2010 to require the parties to engage in non-court dispute resolution (formerly known as ADR). Rule 3.4(1A), with effect from 29 April 2024, allows the family court to encourage parties to pursue ADR, provided there is sufficient time in the proceedings. Accompanying amendments to Practice Direction 3A empower the court to adjourn proceedings, without the parties’ agreement, to promote ADR (rule 4.1). In financial remedy cases, failure to engage in ADR without good reason may result in departing from the general principle of no orders as to costs (amended rule 28.3(7)).

The change in rules resonates with the general direction in civil proceedings as considered in Churchill v Merthyr Tydfil County Borough Council and Others [2023] EWCA Civ 1416 in which the Court of Appeal determined the court does have the power to compel parties in civil proceedings to engage in ADR and if necessary to stay the proceedings to allow such processes to take place. In exercising such discretion, the Court of Appeal stated:

‘The court should only stay proceedings for, or order, the parties to engage in a non-court-based dispute resolution process provided that the order made does not impair the very essence of the claimant's right to proceed to a judicial hearing, and is proportionate to achieving the legitimate aim of settling the dispute fairly, quickly and at reasonable cost.’

While the Court of Appeal in Churchill declined to endorse the Bar Council’s proposed checklist (paragraph 61) for deciding whether to compel parties to pursue ADR, Knowles J’s judgment suggests it could still serve as a useful aid for parties and judges alike. Had the new rules been in operation, Knowles J notes an adjournment of the proceedings would have been justified applying those issues in the checklist relevant to family matters.

In this case, the parties agreed to utilise a natural break in the proceedings before the final hearing to pursue ADR. Whilst directions necessary for the final hearing were approved, their implementation was postponed prioritising ADR efforts, the decision aiming to conserve resources and energy that would otherwise be spent on litigation, directing focus instead towards resolving the issues between them.

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