New requirement to put forward financial settlement proposals

Divorce | 20 Feb 2020 0

New requirement to put forward financial settlement proposals 

I’m sure most family lawyers will encourage their clients to put forward proposals when a financial/property settlement on divorce is in issue. After all, it is much better to settle by agreement, rather than go to the expense of having the court impose a settlement upon you. 

Obviously, the court will encourage the parties to put forward settlement proposals. But until now, it has not been able to compel them to do so, at least until just before any final hearing. 

All of that is about to change. 

New rules 

The other day I came across The Family Procedure (Amendment) Rules 2020 in my news feed. The Rules were made on the 10th of February, and were laid before Parliament on the 13th of February. As the title suggests, the Rules make various amendments to the Family Procedure Rules 2010 which, as that name suggests, are the main set of rules governing the procedure to be followed in family cases. 

I won’t go into the details of all of the amendments (you can read the Rules yourself at the link below if you want all the gen). Instead, I will concentrate upon just one: rule 13, which inserts a new rule 9.27A into the 2010 Rules. 

What does rule 9.27A say? Here it is, in full: 

“Duty to make open proposals after a FDR appointment or where there has been no FDR appointment

9.27A.—(1) Where at a FDR appointment the court does not make an appropriate consent order or direct a further FDR appointment, each party must file with the court and serve on each other party an open proposal for settlement—

(a) by such date as the court directs; or

(b) where no direction is given under sub-paragraph (a), within 21 days after the date of the FDR appointment.

(2) Where no FDR appointment takes place, each party must file with the court and serve on each other party an open proposal for settlement—

(a) by such date as the court directs; or

(b) where no direction is given under sub-paragraph (a), not less than 42 days before the date fixed for the final hearing.”

For those who don’t know, ‘FDR’ refers not to the former President of the United States, but rather to the Financial Dispute Resolution appointment, which takes place shortly after a financial remedies application has been made, and which is intended to provide the parties with an opportunity to negotiate a final financial settlement, with the input and assistance of a judge (for further details, see this post). 

The rule is due to come into force on the 6th of July. 

So, from that date parties must put forward open proposals for settlement, failing which they will no doubt face costs or other penalties. Note that the proposals must be open, not protected by being made ‘without prejudice’, as explained in this post. 

Surprising 

The new rule appears to have come as a surprise to many family lawyers, including myself. I have to say that it seems odd that such a fundamental change to the procedure should occur without (to my knowledge) warning or consultation, particularly as there was already an on-going debate in relation to the treatment of ‘Calderbank’ offers, as I discussed here last July. 

The rule is also a little controversialSolicitor advocate David Burrows, who has posted here previouslyhas even questioned whether such a rule, compelling a party to file an open proposal, is lawful – you can see his thoughts in a post he has written on his own blog. 

I couldn’t possibly comment upon that, but I do find myself a little uneasy at such an infringement of a litigant’s right to conduct the litigation in the way that they think best. When, and even whether, to put forward settlement proposals is all part of the strategy that a party chooses to adopt. Of course, they take the risk as to whether or not their strategy is correct, but at least they have the choice. 

I can, of course, see the rationale for the new rule – we all want cases to be settled wherever possible – but I wonder whether it is driven not by what is best but rather out of an overriding desire to reduce the cost of the family justice system, by reducing the number of cases that go to a final contested hearing. 

Whatever, prepare for things to change after the 6th of July. 

The new Rules can be found here. 

Get in touch

If you would like any advice on divorce or other family law issues please do contact our Client Care Team to speak to one of our specialist divorce lawyers here. 

John Bolch often wonders how he ever became a family lawyer. He no longer practises, but has instead earned a reputation as one of the UK's best-known family law bloggers.

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