BC v BC: A cautionary tale of FDR breakdown, judicial reluctance to scrutinise conduct, and the uncomfortable question – Should there be costs consequences when one party undermines settlement without accountability in private financial dispute resolution hearings?
Yes, the title has 46 words… just like the behaviour in this case, it arguably went on too long without consequences.
The recent case of BC v BC [2025] EWFC 236 has gathered a lot of attention for a mere 46 words in an open financial proposal costing the parties a ridiculous £37,000 in legal fees. However, a broader question arises from this case: should the courts more routinely consider costs when one party’s antics derails the FDR process entirely?
The Case of BC v BC
In a sensible move, the parties in this matter had agreed to attend a two-day private FDR at the First Appointment. At the end of the first day of the private FDR the evaluator gave their indication, (plainly not finding it to her liking) the wife decided to withdraw from the process and left with her legal team. Following the wife’s withdrawal, the husband’s solicitors made an open proposal the next day which started with:
“We write further to the first day of the private FDR before [the pFDR evaluator] yesterday. Of course, today would have been the second day of the hearing were it not for your client’s retrograde decision to leave the building yesterday, not thirty minutes after receiving [the pFDR evaluator’s] written indication.”
The husband went on to imply that the wife’s withdrawal was an “impulsive decision to end the pFDR process so immediately”.
The wife’s solicitors made an application to the court to have these words removed from the open proposal and implied that the wording in the open offer breached the confidentially expectations of the private FDR and attempted to portray the wife unfavourably before the judge. The husband’s solicitors disputed the wife’s claim that the offer made no reference to the detail of the offers made at the private FDR and the wording was simply “logistical details”.
After considering the relevant provisions of the FPR, FPR Practice Directions, legislation and case law, Mr Justice Peel decided to strike the disputed 46 words from the record and reinforced that any content from an FDR must not seep into open correspondence.
In his judgment, Mr Justice Peel pulled no punches: £37,000 spent litigating over just 46 words in an open proposal was, he said, “a startling sum.” Too right. Was this application ever remotely cost-proportionate? The husband’s legal team erred by referring to the private FDR hearing, which could have been addressed by withdrawing and resubmitting without the disputed words. The wife’s decision to pursue a strike out application and later leave the private FDR without settlement discussions also drew comment. However, the judge did not take these factors into account when considering the question of costs.
But how will such conduct be penalised in cases like this? Here, the parties chose a private FDR – meaning no judge in real time could slap down the offending behaviour with an immediate costs order. By the time the matter found its way back to court, the moment for swift, decisive sanction had passed. The result? Tactical mischief can slip through the cracks, leaving the wronged party to fight another day (and spend yet more money on such applications as this). It’s a gap in the system that invites gamesmanship – and one the courts may need to plug if private FDR forums are to retain their integrity.
What behaviour attract costs?
Under the FPR 2010, r28.3(5), the default position is that the court will not make an order requiring one party to pay the costs of another party. This principle attempts to encourage parties to pursue a financial settlement without fear of disproportionate financial risk.
PD28A details the different way in which conduct may attract a costs order, but specifically if there is a failure to negotiate openly and reasonably (PD28A 4.4). However, BC v BC exposes a notable gap regarding parties who are genuinely attempting to settle on a without prejudice basis. While the without prejudice rule plays a vital role in encouraging honest and frank settlement discussions, if behaviour and conduct (no matter how reprehensible) can remain hidden behind closed doors, how can a court hold parties accountable for their conduct? In cases that may be similar to this, a party can avoid scrutiny for their conduct while the other party is left bearing the financial burden of what may have been a deliberately stalled or obstructed settlement process.
BC v BC highlights the tension between this default position and the growing need to address unreasonable conduct that frustrates settlement efforts whether in open proceedings or mandated, without prejudice settlement hearings. When one party acts in a way that frustrates a genuine attempt at settlement, there must be real consequences to deter others from hiding behind closed doors. If parties know they can walk out of private FDRs without consequences, the system will simply become vulnerable to manipulation. By considering, following Trial or on application, whether to make an order for costs when one party’s conduct at a private FDR renders the hearing ineffective, it would incentivise parties to negotiate constructively.
Private FDRs are becoming increasingly popular as they offer quicker listing times compared to court-based hearings and the parties have the opportunity to appoint a judge of choice with the relevant expertise. Their growing popularity, particularly in light of the court delays across the country, highlights the need to preserve them as an effective forum. That preservation must include the ability to impose sanctions where the process is undermined or rendered ineffective due to the unreasonable conduct of one party. If parties are allowed to walk out of private FDR hearings or act unreasonably without any sanction, the integrity of the system becomes compromised. It creates an opportunity for tactical behaviour, delays and increased financial stress and wasted costs.
A challenge
Mr Justice Peel’s comment in BC v BC as to “why a party behaves in a particular way at the pFDR, and why wife terminated it in this case, is not for any court subsequently to know. It is not sensible or feasible to extract a snapshot of behaviour from the FDR without understanding the whole context” raises concerns about accountability. If the courts refuse to consider any conduct at an FDR when assessing costs, even in clear cases of bad faith or obstruction, the parties will have a hall pass to misuse the process without consequences. This is especially problematic in private FDRs where judges cannot make decisions on costs as it leaves no immediate recourse for addressing such conduct.
It is of course not proportionate nor desirable to suggest punitive cost orders for every procedural misstep or minor lapse in conduct, and it is important to preserve the sanctity of without prejudice forums to allow people to freely and comfortably negotiate under that blanket. However, where behaviour seeks to undermine the purpose and nature of the FDR (as it did in BC v BC), the courts must be more willing to make targeted costs orders.
This approach would reinforce the integrity and importance of the FDR process, both private and court-based, as a forum for genuine negotiation. Furthermore, it would send a clear signal to all parties that strategic non-engagement or obstruction will have financial consequences. This will align with the overriding objective of the FPR to deal with cases justly and proportionately. It will also help ensure that valuable court time and resources are not misused (it might even help get cases listed quicker…one can only hope).
Jessica Richardson is a Solicitor in the Family Team at Birketts LLP
