Wealthy couples are increasingly by-passing the public, slow and chronically underfunded family court system to resolve the financial aspects of their divorce with the help of a private judge, especially in London, according to law firm Kingsley Napley.
Although the introduction of No-Fault-Divorce in April 2022 has reduced acrimony around the dissolution of a marriage, the potential for separating couples to be in dispute over finances remains.
The Family & Divorce team at Kingsley Napley found that 88%1 of their Financial Dispute Resolution (FDR) cases last year involved a settlement assisted by a private judge, compared to just 8% of their cases in 2018 and notably up from 66% of cases last year.
A private FDR is a without-prejudice hearing between spouses, where a judge, usually a barrister or retired member of the judiciary, is hired to give an indication on the way a court would most likely rule given the circumstances of their case. The parties then negotiate and ideally reach a settlement, with most cases settling at the FDR or soon thereafter.
According to Sital Fontenelle, Head of Kingsley Napley’s Family & Divorce team: “The introduction of No-Fault-Divorce removed the need for separating couples to apportion blame in order to secure a divorce. However, there is still the potential for dispute over finances.
“Given the vagaries of leaving this to the timescales and unpredictability of a public court hearing, we have seen a notable shift towards couples opting for private FDRs. They get to choose their Judge in advance, who will have the time and expertise to consider their case properly on a date of their choosing. The extra cost involved is often worthwhile considering these upsides.”
Cost
The cost of a private judge is usually in the £7k- £10k range (plus VAT) but may be more, depending on the type of case or level of judge required.
Sital comments: “When we analysed our case data for the last couple of years, we realised the majority of the FDRs in our financial remedy cases now involve private judging. It is no longer simply the super-rich who opt for this approach, but it is increasingly the norm for couples with £1m upwards of assets.”
Pandemic & transparency factors
Many attribute the shift which has occurred to the pandemic but the family court’s latest transparency drive2 has also been a factor.
Sital says: “Lock down was a game changer when it comes to the recent growth of private judging. Couples and family lawyers really saw the value especially against the context of a family court system struggling to cope and needing to focus on urgent or public interest cases.”
“Not only does private judging help couples to resolve the financial aspects of their divorce more efficiently, many also prefer that it takes place away from the courts, results in greater chance of settlement and thereby avoids a final hearing where the press may be present.”
There has also been a notable growth in private arbitration as the FT reported recently based on figures from the Institute of Family Arbitrators which said there were 130 arbitrations about financial settlements for divorces in the year to mid December 2024 compared to 89 for 2023. Private arbitration is a process where an arbitrator makes a binding decision on a dispute, whereas a private Financial Dispute Resolution (FDR) is a negotiation process with a judge providing guidance.
Two-tier justice
Whilst some are concerned about the development of a two-tier system for resolving the financial aspects of divorces, the idea of private FDRs has been encouraged by the Judiciary3.
Sital comments: “At a time when the family courts are under severe pressure, it absolutely makes sense for couples who can afford it to pursue other ways of resolving their differences especially over financial matters. There is a myriad of non-court options available to divorcing couples and the private judging route can be highly effective in helping couples to reach an out-of-court agreement.”
