Coping with Coronavirus – Family Law Update

The impact of Coronavirus is far-reaching and brings with it much uncertainty and fear. Whilst dealing with family law matters at any stage can be stressful, this is most certainly magnified in these current times. Individuals in the midst of a divorce and/or separation will have many questions, which this article will try to answer.

It is essential to bear in mind that each case is dependent on the type of matter and the facts involved. The way forward for individuals must be carefully considered and weighed up with the benefit of legal advice.

Court Hearings – are these still going ahead and if so, how?

In short, yes – wherever possible, these are still going ahead, but most likely in a different format.

First Direction Appointment hearings, which are the first hearing in Financial Remedy applications (“FR Applications”) are being dealt with where possible, on paper. In reality, what this means is that both parties need to try and agree on Directions that will be put into an Order that is subsequently then filed with the Court for approval, which will progress a case to the next stage. Thus, avoiding the need for Court attendance.

Financial Dispute Resolution hearings (“FDRs”) are the second hearings in FR applications and are to be held remotely. These types of Hearings have been taking place either by way of conference call or with the use of IT such as Zoom (or equivalent). In addition, Mr Justice Mostyn (a High Court Judge assigned to the Family Division) released a statement on 17 March 2020, which in essence stated parties should be encouraged to have their FDR Hearings privately, (as well as remotely).

Private FDRs, (FDR being the stage at which a Judge usually gives their “early neutral evaluation” of the likely outcome in the case, after which the parties are encouraged to reach settlement) can be conducted instead by others such as a barrister, whom both parties agree to instruct as such. In this scenario, a barrister will read and consider all the papers, hear from both parties and then give their neutral evaluation of the likely outcome. This means both parties hear from an independent expert what the probable outcome of their case would be at a Final Hearing.

It is at this stage that many cases settle because both then know what they are likely to either gain or lose. By settling at this stage, the savings in terms of both time and legal costs can be substantial. Whilst both parties incur the cost of a private FDR, there are barristers in the current climate offering reduced rates, and, although the rate of successful settlement at a Court FDR is good, it’s even better at a private FDR.

This is something, therefore, very much worth considering. An added benefit is that parties can choose the private FDR Judge and the date and timings, which is not a luxury afforded by the traditional Court hearing.

Final Hearings, (where a Judge makes the Final Order based on all the evidence provided) are at present proceeding remotely via Zoom, but this is case dependant.

Some parties may prefer to wait until the hearing can take place at Court, and this is something the parties need to consider carefully with their legal advisors.

It is important to bear in mind that there are also other ways to resolve family law disputes, and one of those alternate ways is Arbitration. This is where an independent person is appointed to resolve any dispute, and this method has gained strong Judicial encouragement.

Again, whether this is a suitable alternate option does depend on the case and issues involved. However, not only can it be used in place of a Final Hearing, but, it can also be used to deal with a specific issue (where everything else is agreed between the parties, bar one matter, such as the split of the pensions).

It can also be utilised for other matters, such as Maintenance Pending Suit applications, Legal Services Payment Orders and any issues in terms of implementation of a Final Order.

Varying Periodical Payments – what if the Payer has been made redundant or furloughed?

In this circumstance, Coronavirus does present a unique challenge to both parties. There may be situations where the Payer has either been made redundant or furloughed (and may only be getting 80% of their usual salary). The Payee may also have been made redundant or furloughed.

In any of these scenarios, what happens in terms of the Periodical Payments Order (“PP Orders”)?

First, it’s important to remember the two principles that apply to PP Orders. They are, what can the Payer afford, and what are the Payee’s needs? A balance needs to be struck that works for both parties. Just because the Payer’s means have changed, doesn’t mean the needs of the Payee have altered.

The starting point for the Payer seeking a reduction in terms of quantum is understanding that to do so is technically in breach of the PP Order. However, consideration needs to be had as to whether it’s worth litigating, and this may be advantageous to the Payer. The Payer cannot be advised to be in breach of a PP Order, but it is worth trying to resolve without reverting to Court.

For the Payee, they need to consider if they would have a realistic prospect of success if they were to look to enforce the PP Order.

Careful consideration is needed, and any open correspondence on the issue needs to look at both parties’ financial positions. How long does the Payer propose the reduction in PPs will last and is there any reasonable prospect of the variation being sought, litigated? A clear route map and disclosure should be provided to ensure that the issue can be properly assessed.

Final Orders already obtained – can these be changed?

The ability to change a Final Order is known as a “Barder Event” and pre the Coronavirus it was possible to change a Final Order if it were fundamentally unfair.

There has been much in the press and on Social Media as to whether the Coronavirus and subsequent lockdown would amount to a Barder Event. Judges are likely to be very careful not to allow applications, where the Coronavirus is cited to avoid opening the floodgates for numerous claims.

The test is an objective one and usually requires four things to have taken place:

  1. Whether the new event was unforeseeable post the Order being made
  2. That the event took place a short period of time post the Order
  3. Any application for Leave to Appeal was made promptly
  4. The interest of any third parties isn’t adversely affected

Divorce & separation – should I press ahead?

These are unprecedented times and for those individuals who have already started matters, these can and will continue, albeit most likely in a different format.

Couples still wanting to divorce and or separate, will be restricted by the current lockdown, but that’s not to say they cannot continue to make plans to be implemented in due course.

There are certain situations which do have to be put on hold, and there may be a good reason to hold off valuing certain assets now due to a reduction in value.

It’s also essential to remember that there are alternate ways to resolve family disputes, including Mediation and Arbitration, the latter of which was touched on earlier. These alternate methods can still go ahead during the lockdown and may even prove to be a swifter way of reaching agreement and at a lesser cost to both.

Summary

If you would like any further advice or assistance, please contact me for a 30 minute, no-obligation consultation.

Elizabeth Stocker

Consultant Family Lawyer
DDI: 01865 955 476 / T: 0330 058 4012 / ext.2142
E: estocker@setfords.co.uk