Between the first1 and third2 Farquhar reports, the members of the FRC Recovery Group – initially set up by Mr Justice Mostyn and chaired throughout by His Honour Judge Stuart Farquhar – were put to good use.

A second report, A Paper to consider changes to the Practices and Procedures in the Financial Remedies Court, was published in September 2021. Its purpose was to recommend changes to the practices and procedures in the Financial Remedies Court (FRC) with a view to promoting greater efficiency.

The second report (the Report) was, itself, a model of efficiency. Although completed within just 3 months, the basis for the Group’s recommendations was sound. Views were drawn from the range of family law judges, practitioners and other Family Court users who responded to the wider survey which informed the recommendations of the first report. Those views were supplemented by a further survey of FRC judges in August 2021. The Family Court statisticians provided data which was analysed and discussed at length by the Group’s 11 members, themselves representing a broad spread in terms of geography, seniority and, in the case of the practitioners in the Group, the value of their typical case.

Amongst its other achievements, the Report gave rise to the Statement of Efficient Conduct of Financial Hearings at every level below the High Court. This followed the format of the existing High Court version (February 2016),3 adapted where necessary, and was implemented relatively swiftly in January 2022.

However, a large part of the Report’s focus was the proposed fast track procedure set out in Chapter 5. Work on this aspect of the Report was informed in part by the research conducted by the Centre for Child and Family Law Reform (CCFLR) and the conclusions set out in their May 2020 report Fast-Tracking Low-Value Financial Claims in the Family Court.4

In over a third of cases surveyed for the CCFLR report, both parties were litigants in person (LIPs).5 It was acknowledged that LIPs, as a category, were more able to agree an ‘early’ (i.e. pre-FDR) settlement than their represented counterparts.6 However, the general trend, in those cases concluding in a consent order (over 81% of all cases), was for agreement to be reached towards the end of the financial remedy process – after the FDR but before the final hearing.

The duration of cases concluding in a consent order (245 days)7 was considered disproportionate to the average value of the assets involved. Including pensions but excluding the family home, this was put at £381,455.8 The figure was even lower in cases where both parties were LIPs: £248,865.9

Further, the impact of delay was recognised. It not only causes substantial emotional distress upon the parties and any children of the family, but also puts huge pressure on the lists within the FRC.10 Further, it was observed that lengthy delay causes unfairness to a party who is dependent upon a lump sum order or the sale of the former matrimonial home and the division of the proceeds in order to be able to move on.

The CCFLR report opined that two factors seemed to be primarily responsible for this unsatisfactory situation: the first was the underutilisation of the first hearing as an opportunity for either dispute resolution or, alternatively, to signpost parties to non-court dispute resolution. The second was that LIPs were not given sufficient assistance to understand or manage the formalities of court procedure. This has two main consequences: (1) parties fear committing to an early solution during what they understand will be a multi-stage court process; and (2) it can lead to non-compliance with court orders.

It was suggested that – for cases dealing with assets below a particular financial threshold – an early, neutral and without prejudice evaluation would help manage parties’ expectations and steer them towards early settlement.

As to what the financial threshold might be, the Group acknowledged both the very small sample size (69 cases) analysed in the CCFLR report and the lack of statistical evidence collected in respect of the value of cases in the FRC. Further work was undertaken to establish the optimum financial threshold if a pilot was to be introduced. A questionnaire was sent to every judge approved to sit in the FRC with a request to record the value of cases that they dealt with over a 2-week period in August 2021. It was accepted that this method would not necessarily stand up to a rigorous statistical analysis, but it was thought to be a beneficial exercise for providing a rough guide to the level of work being carried out.

Of the 531 cases analysed by financial remedy judges as part of their questionnaire responses, almost two-thirds of cases (63.1%) involved net assets including pensions of less than £500,000. Over 40% involved assets including pensions of less than £250,000. The Group considered that any new procedure should apply to cases involving combined net assets of £250,000 and that the figure should not include pensions. The exclusion of pensions in the calculation was deliberate. An applicant is unlikely to know the value of both parties’ pensions at the time Form A is issued. This would cause confusion as to whether the case met the fast track criteria, whatever threshold was adopted. Further, it was considered unlikely that, in cases involving total net assets of less than £250,000, pensions would feature significantly.

Taking into account the existing research, the statistical data and the survey views, the Group concluded that there would be significant advantages in piloting a scheme which enabled parties in lower value cases, who were statistically more likely to be LIPs, to attend the first hearing having provided in advance the information a judge would need to give them an early neutral evaluation as to the likely outcome.

This chimed with the collective experience of the judicial members of the Group who were frequently faced with LIPs who simply wanted to be told ‘the answer’.

Whilst our existing procedure already permits a First Appointment to be treated as an FDR,11 the take up of that facility is poor. The reality is that First appointments are not listed to allow sufficient time for an early neutral evaluation, and the standard disclosure process means neither the parties nor the court are likely to have the information necessary to assess a fair outcome at the First Appointment stage.

A working party, comprising judges, practitioners, representatives from the MOJ and HMCTS, and chaired by Mr Justice Peel, was established in 2023 as a sub-committee of the Family Procedure Rule Committee. Its purpose was to oversee the development of a pilot to test a fast-track financial remedies procedure, backed by an alternative procedural code set out in Part 9 FPR 2010.

The pilot for that procedure, known as the express financial remedy procedure, has now been developed and is hoped to start in April 2025. It will apply to all cases involving combined net assets of less than £250,000 (excluding pensions) where the Form A is issued in any of the pilot courts.12

The Form A is being amended to include a box which will be ticked where the applicant considers the combined net assets involved in the case (excluding pensions) is less than £250,000. All cases in the pilot courts where that criteria is met will be automatically entered into the pilot and a modified Form C will be issued. It will be open to parties to apply (on D11) to exit the pilot if eligibility for the pilot changes or the express procedure is otherwise considered unsuitable.

The case will be timetabled through to an hour’s first hearing between 16 and 20 weeks after Form A is issued and, where possible, a one day final hearing will be listed simultaneously to take place between 26 and 30 weeks after the issue of Form A. It is envisaged that those final hearings may, in some courts, be subject to block listing.

The first hearing will be conducted by the judge as an FDR. To enable the court to assess the case and indicate the likely outcome, disclosure will be ‘front loaded’. Forms E, property and other asset valuations, mortgage-raising capacity, particulars of suitable properties, replies to questionnaire (which may be answered subject to just exception) and settlement offers will all be made available to the court in advance of the first hearing.

If the parties reach an agreement at the first hearing, they will be invited to file a consent order and the final hearing (if already listed) will be vacated. If agreement is not reached, the court will give suitable directions to ensure that the final hearing – ordinarily listed 10 weeks later – will be effective.

The objectives of the pilot are clear: to drive early settlement within a swifter, simpler process for those cases where the low asset value signifies that a significant proportion of litigants will be self-representing. The express procedure will be of obvious benefit to those litigants involved in the pilot. The front-loaded disclosure requirements will be subject to a clear but accelerated timetable which will require litigants to focus on the steps necessary for an effective first hearing and avoid drift. There will be fewer court hearings overall and, at the first hearing, parties will be given clear judicial guidance as to the likely outcome and other financial consequences if the matter continues to be litigated. If the parties cannot be guided to reach agreement at the first hearing, any contested cases should be concluded within 6 months of issue.

The pilot materials – guidance notes for litigants, practitioners and judges, the relevant practice directions and amendments to the procedure rules – will be published shortly.