Intervenor Cases: Preliminary Issue Hearing or FDR (or NCDR)?

In financial remedy cases involving disputed third-party interests, a question often arises as to whether an FDR should take place before or after a contested preliminary issue hearing.

These intervenor cases often involve a family member who either claims to have a beneficial interest in a property registered in the legal name of one of the spouses, or who is the legal owner of a property which is said to be partially or wholly beneficially owned by one of the spouses. In either case the family member may be joined to the proceedings to protect their property interests.

There appears to be a view shared by legal professionals that the number of these ‘bank of Mum and Dad’ type cases are on the rise.

The procedural starting point

The starting point for procedure in these cases is the judgment of Mostyn J in TL v ML & Ors (Ancillary Relief: Claim Against Assets of Extended Family) [2005] EWHC 2860 (Fam), in which he set out the principles in this way:

‘In my opinion, it is essential in every instance where a dispute arises about the ownership of property in ancillary relief proceedings between a spouse and a third party, that the following things should ordinarily happen:

i) The third party should be joined to the proceedings at the earliest opportunity;

ii) Directions should be given for the issue to be fully pleaded by points of claim and points of defence;

iii) Separate witness statements should be directed in relation to the dispute; and

iv) The dispute should be directed to be heard separately as a preliminary issue, before the FDR.’

The reason for determining the question of third-party ownership first is entirely logical; the court needs to know what the assets are before it can decide (at final hearing) or indicate (at FDR) how they should be distributed. So, for the divorcing parties, an early determination will bring greater clarity to the remainder of their case including their negotiations at FDR.

The principles in practice

In practice however most, if not all, of us will have experience of an FDR being listed prior to a preliminary issue hearing. Perhaps most often that procedural course is taken by consent in modest asset cases. An ‘all issues’ final hearing may then follow if settlement is not reached.

How then does the court approach the decision as to the timing of the FDR if the issue is not agreed? The answer to that question is difficult to pinpoint as this is not a case management issue which is well ventilated in case law.

Nonetheless proceeding to an FDR prior to a preliminary issue hearing does find some support in caselaw. In Shield v Shield [2013] EWHC 3525 (Fam) Holman J considered the issue and declined to make any general comments as to the appropriate time to hold an FDR. He did however consider that an FDR would have been preferable prior to the preliminary issue hearing (although that did not happen in that case). In the same case and at the preliminary issue hearing itself Nicholas Francis QC (as he then was, sitting as a DHCJ) noted that an FDR had not taken place and whilst acknowledging that it has been ‘made clear in a number of cases, an FDR will not necessarily be appropriate to the resolution of a preliminary issue’, he expressed his view that ‘consideration should at least be given to the possibility of an FDR prior to the hearing of a preliminary issue’ (Shield v Shield [2014] EWHC 23 (Fam)).

The door is therefore open to the ‘possibility’ of the court directing an FDR to precede the preliminary issue hearing (Shield v Shield), but we still have the principle that ‘ordinarily’ that should not be the case (TL v ML).

Is it time to move on?

My question is whether in 2026 the application of TL v ML in this context, which effectively operates as a presumption against an early FDR, is consistent with the development of the Family Procedure Rules 2010 in respect of Non Court Dispute Resolution.

Mostyn J’s judgment pre-dates the FPR by five years and the 2024 changes to the NCDR provisions by nineteen years. Shield v Shield although in support of an active consideration of an FDR makes no reference to other forms of NCDR and also predated the changes to FPR Part 3 by eleven years.

Intervenor cases are an unusual species of litigation in that they proceed under the procedure applicable to financial remedies and in the absence of any specific procedural regime of their own within the Rules. They arise within the context of the other parties’ claims and have to fit into that procedural matrix. Intervenors are not the focus of the proceedings and the Rules were not written with them in mind.

For an intervenor however, the matters in dispute and their involvement in the proceedings may be extremely significant. A declaration of beneficial interest or order for sale may have far-reaching consequences for their lives, particularly if the property in question is their home. They may be of modest means and the costs of engaging in proceedings could have a long-term impact on their financial wellbeing, which would not necessarily be remedied by a costs order.

If we consider the position of an intervenor, the registered proprietor of a property who is said to own it on trust for one of the spouses. They are given notice of the proceedings and apply to be joined in order to protect their property. Directions are then given for points of claim and points of defence, witness statements and a preliminary issue hearing to determine beneficial ownership. For the intervenor that preliminary issue hearing is their final hearing and it comes without the benefit of any pre-action step such as a pre-action protocol or prior engagement with NCDR.

There is of course nothing to prevent the parties and intervenor agreeing to go to mediation, holding a round table meeting or attending a pFDR, but without the court’s encouragement this may well not be agreed.

Yet if the intervenor were facing a civil claim in the county court they would have the benefit of the provisions of the Civil Procedure Rules 1998 including the pre-action protocol and the requirement to consider NCDR. A judge in a civil TLATA claim may adjourn the case and require the parties to mediate or engage in early neutral evaluation (pFDR) (CPR 3.1).

The parties to the main financial remedy proceedings will have engaged with the financial remedy pre-action protocol which requires attendance at NCDR. They will have been required to attend a MIAM (unless an exemption applies) and they will have the opportunity to attend an FDR in due course.

The result of the unusual procedural position is that from an intervenor’s perspective, the usual emphasis on NCDR is diluted and they are not afforded the same opportunities or encouragement by the Rules to resolve their disputes out of court.

So, is it time that we considered this case management issue more purposefully and in line with the spirit and intention of the NCDR provisions in the FPR?

In my view there is certainly force in the argument that if there is to be a presumption in respect of case management, that should be a working presumption in favour of there being an FDR or a form of NCDR involving all parties and intervenors before a contested preliminary issue hearing.

The role of an FDR

One point often made against there being an early FDR in an intervenor claim is that the judge will not be able to give an indication on the factual dispute. Although, in my experience this argument is still frequently articulated, the weight to be attributed it must have been diminished, if not extinguished, by the judgment in GH v GH [2024] EWHC 2547 (Fam) in which Peel J said:

‘In my personal experience, even the most intractable case can yield to settlement at the FDR. The purpose of it is to enable the parties to hear (probably for the first time) an independent evaluation of the likely outcome, and the risks (in terms of costs, uncertainty, delay and emotional toll) of continued litigation. The FDR judge is there to tell the parties if their proposals are sound or devoid of merit, or if particular points or arguments are or are not likely to find favour at trial. It is often those hard cases where one or other party appears utterly intransigent that the FDR judge's indication and observations can be of greatest utility. The FDR judge is well able to deal with factual issues (such as, in this case, W’s earning capacity), not by determining them but by expressing a view as to how they appear on the available evidence and how relevant they are. The FDR judge is also well able to give a clear overview even if (as the judge assumed to be the case here) one or other party's position is not fully crystallised.’

FDRs can be an extremely effective tool for promoting settlement even in cases where there are disputes as to computation and therefore the asset base is uncertain.

The role of the FDR judge or pFDR evaluator is to consider the available evidence and express a view to assist the parties in settling. After all, the assessment of the evidence as well as the merits of a case is at the heart of what parties must consider when approaching settlement. Litigation risk can be taken into account in reaching a settlement – that is the bread and butter of civil mediation (where disputes as to beneficial interests are frequently settled). We may not be used to factoring third party claims into the negotiations, but there is certainly scope for successfully doing so.

Of course there will be advantages and disadvantages to an early FDR and the balance is likely to fall differently depending on factors such as the value of the disputed asset and whether this is a family property dispute or something more complex. In many cases however, a court-based FDR may present a golden opportunity to resolve the entire proceedings by agreement without incurring significant costs.

In those cases where it is not appropriate for an ‘all issues’ FDR to take place first, there remains the possibility of resolving the property dispute with the intervenor by use of NCDR confined to that issue. A successful settlement would allow the parties to the main proceedings to continue to their FDR without the delay and expense of a multi-day preliminary issue hearing.

Achieving fairness by applying the NCDR provisions with clarity

Within the Rules there exists the means to provide intervenors with a court initiated opportunity for NCDR.

FPR 1.1 is the overriding objective which provides:

‘(1) These rules are a new procedural code with the overriding objective of enabling the court to deal with cases justly, having regard to any welfare issues involved.

(2) Dealing with a case justly includes, so far as is practicable –

(a) ensuring that it is dealt with expeditiously and fairly;

(b) dealing with the case in ways which are proportionate to the nature, importance and complexity of the issues;

(c) ensuring that the parties are on an equal footing;

(d) saving expense; and

(e) allotting to it an appropriate share of the court’s resources, while taking into account the need to allot resources to other cases.’

In an intervenor case, dealing with the case fairly, ensuring that the parties are on an equal footing and saving expense may all be achieved by affording the parties and intervenor the opportunity to resolve their disputes prior to a preliminary issue hearing.

FPR 3.1 requires the court to consider, at every stage, whether NCDR is appropriate and in considering the issue the court must take into account whether the parties have engaged in mediation or another form of NCDR and the outcome. It follows that at every hearing at which an intervenor is joined, the court (and the parties) should actively consider the issue.

In X v Y [2024] EWHC 538 (Fam), shortly before the introduction of the new FPR Part 3 provisions, Gwynneth Knowles J gave judgment emphasising the importance of the impending changes:

‘I consider it might be helpful for those involved in family proceedings, whether concerning money or children, to understand the court’s expectation that a serious effort must be made to resolve their differences before they issue court proceedings and, thereafter, at any stage of the proceedings where this might be appropriate. Furthermore, I want to signal that, at all stages of the proceedings, the court will be active in considering whether non-court dispute resolution is suitable.’

In an intervenor case it may not be possible for those efforts to be made prior to issuing proceedings, but that does not mean that the opportunity to avoid protracted proceedings should not be grasped.

FPR 3.4 provides that:

‘Where the timetabling of proceedings allows sufficient time for these steps to be taken, the court should encourage parties, as it considers appropriate, to—

(a) obtain information and advice about, and consider using, non-court dispute resolution; and

(b) undertake non-court dispute resolution.’

The court timetable can therefore make provision for either an FDR or an adjournment for NCDR. In NA v LA [2024] EWFC 113 Nicholas Allen KC (sitting as a deputy High Court judge) took the step of staying the financial remedy proceedings to allow the parties to attend an out of court process. Building space for an out of court process into the court timetable is likely to be much more effective at achieving engagement than simply leaving it in the hands of the parties.

In the main financial remedy proceedings the NCDR provisions are backed by the possibility of a costs order if a party does not engage pursuant to FPR 28.3(7). That provision does not apply in intervenor cases in which costs are determined on the ‘clean sheet’ basis. However, that is not to say that a refusal to attend NCDR might not be an important factor in any costs decision, carrying weight when placed upon the clean sheet.

Recently commentators have observed that the powers available to the court have not effected the significant changes in approach that had been anticipated. In her insightful blog article ‘As NCDR Rule Changes Reach Toddlerhood, Are They Hitting Their Milestones?’ Katherine Landalls points out that if the changes were working we would see reported cases adjourning cases for NCDR or making a costs order where there is a failure to engage. She argues that a significant change is needed, by way of increased judicial intervention and a change in professional culture. I doubt that many practitioners would disagree. We all have a role to play in bringing about the necessary culture shift.

Case management directions are key to making the NCDR provisions effective. They cement the court’s expectation of the parties and advocates that the issue will be considered at the relevant hearing. In this type of case directions may include a requirement for the parties and intervenor to address the question of an FDR/NCDR in their position statements (and/or complete an FM5) for the first hearing involving the intervenor. ‘FDR, NCDR or preliminary issue hearing’ can be added to the list of issues for determination at that hearing. In this way we can ensure that the ground is properly prepared for active judicial consideration.

Conclusions

So, the question in intervenor cases is not just whether an FDR should take place before or after the preliminary issue hearing but whether, applying FPR Part 3 and the overriding objective, there should be a working presumption or starting point in favour of either NCDR or an FDR prior to a preliminary issue hearing.

In my view, this approach is consistent with spirit and purpose of the Rules and should ‘ordinarily’ be the direction of travel in such cases.