If the parties cannot reach a financial agreement regarding the breakdown of a marriage, financial remedy proceedings may be brought in court. Generally, there will be three hearings – a First Directions Appointment Hearing (FDA), a Financial Dispute Resolution Hearing (FDR) and a Final Hearing.
First Directions Appointment Hearing (FDA)
The First Directions Appointment Hearing is a short directions hearing with four main purposes:
1. To identify the key issues. The Judge will review the documents and decide which questions still need to be answered.
2. To give directions on valuing assets and obtaining any further evidence needed for the case.
3. To set a timetable for Replies to Questionnaires, valuations and any other necessary steps.
4. To list the case for a Financial Dispute Resolution Hearing.
Financial Dispute Resolution Hearing (FDR)
The second hearing, the Financial Dispute Resolution Hearing, is a negotiation Hearing. Before the FDR, both parties are expected to have carefully considered their positions, exchanged realistic settlement proposals, and understood the likely range of outcomes. All discussions at the FDR are without prejudice, meaning they cannot be referred to later, which allows for open negotiation. The court expects both parties to be reasonable and to try to reach an agreement.
The parties must attend court an hour before the FDR to allow time for discussions. If issues remain unresolved, the Judge will give a non-binding indication of what they might order at a Final Hearing. This guidance helps the parties understand how the court is likely to approach the case.
If an agreement is reached at the FDR, a Financial Remedy Order will be drafted and signed at court. Once approved (provided a Conditional Order of Divorce is in place), it becomes a final and binding settlement of all financial claims. Both parties then take steps to implement the Order.
Final Hearing
If no agreement is reached at the FDR, the Judge will set directions for the remainder of the case and list it for a Final Hearing. At that stage, both parties (and any experts) give oral evidence, and the Judge makes a final decision.
Because the FDR Judge has seen the parties’ without prejudice proposals, they will not deal with the Final Hearing unless a second FDR is required or a Financial Remedy Order needs to be approved.
Private Financial Dispute Resolution Hearing (pFDR)
A private FDR is an alternative to a court-based FDR. This is a voluntary, out-of-court process in which both parties jointly instruct a senior Counsel or retired Judge to review the financial information and provide an informed, neutral view on what a fair settlement is likely to look like. A pFDR operates in a very similar way to the court-based FDR stage.
Advantages of a pFDR:
1. Speed and avoidance of court delays
The family courts are currently under significant strain, and listed Hearings, particularly FDRs (which are usually listed for one day), are frequently adjourned or delayed. A pFDR allows the parties to set a date of their choosing, often within weeks rather than months, avoiding the risk of last-minute cancellation by the court. The benefit is that it helps to keep the momentum of negotiations and reduces the emotional and financial stress of prolonged proceedings.
2. A dedicated Judge for the entire day
Unlike a court-based FDR, where the Judge may only have limited time due to a busy list, a pFDR Judge (usually a senior Counsel or retired Judge) dedicates the entire day to the case. The benefit is that there can be full and careful consideration of your position, papers and proposals and an opportunity for multiple rounds of negotiation throughout the day.
3. Greater judicial expertise
pFDR Judges are usually senior Counsel or retired Judges with extensive
experience in financial remedy matters. The parties can choose the Judge. The benefit is that the parties receive a high-quality, focused indication from someone who has deep expertise in the relevant financial issues.
4. Increased likelihood of settlement
Because of the time, focus and quality of the indication, settlement rates in pFDRs are significantly higher than in court-based FDRs. The parties can potentially avoid a contested Final Hearing, with considerable savings in legal costs and greater finality for both parties, much earlier in the process.
5. Flexibility in format and venue
The parties can choose the date, the private Judge and a convenient venue, often at Counsel’s chambers or Solicitor’s office. This flexibility allows for a more relaxed and productive negotiation environment, rather than the court’s more rigid structure.
6. Cost savings
While there is an upfront cost for the private Judge’s fee, this is often shared between the parties and is usually far less than the cost of progressing to a Final Hearing.
7. More constructive atmosphere
A pFDR tends to be less adversarial and more settlement-focused than the court setting.
