Tuesday, 15 April 2014

The Musings of Chairman Ag on the Financial Remedies Unit

Today's blog comes from guest-blogger Margaret Heathcote.  Follow Margaret on Twitter @Auntie_Ag

Some readers of this blog will have received my e-mail, sent in my capacity as Chair of Resolution’s London Regional Group, about the operation of the “Financial Remedies Unit” (“FRU”) at the Principal Registry – very soon to be re-designated the Central Family Court (“CFC”).  Those who did not can read the detail of the changes here.  The corresponding FRU standard directions order template is available here. 

When reviewing the proposals, some of them struck me (as an old Registry hand) as faintly familiar.  Others seemed slightly optimistic.  I share some of my ponderings with you here…

1.       Having an allocated Judge  

A terrific idea, but hardly a revolutionary one.  A long time ago, in a galaxy far, far away (that is, in the Principal Registry until around 1996), when an application for a financial remedy (or “ancillary relief” as we called it in the olden days) was issued, a directions appointment would be fixed before a named District Judge.  Thereafter, that Judge would, so far as possible, hear the case from beginning to end.  Since this was before the invention of the “Pilot Scheme” (when, by the way, did we lose the Pilot, but not the Scheme?) and therefore of the FDR appointment, there were no issues of privilege with which to grapple.  In our Brave New World, we will have not one, but two allocated District Judges – the first up to and including the FDR, and the second thereafter through to disposal of the trial. 

I note as an aside that the guidance we have suggests that this is to be the case “in general” – perhaps they too have doubts about how this can be achieved with an ever-decreasing pool of Judges?

2.       Having a pro forma pick ‘n’ mix directions order

A good idea, but is it a useful one?  Again, back in the day, most Courts had their own version of a pro forma directions order. 

If my recollection serves:

(a)          they were very much shorter and simpler than the eight-page Mostyn J / Munby P house-rules compliant behemoth cum chimera prepared by District Judge Edward Hess (for which we thank him), and

(b)           they were very rarely used as anything other than an aide memoire (at least at the Principal Registry) as (even then) one-size-did-not-fit-all.  It didn’t then and it doesn’t now. 

Why, in a world in which there will assuredly be far more litigants-in-person - few of whom we must assume will have had the advantage of either the education or training enjoyed by Mostyn J or Munby P (or even, dare I say it, the average ‘umble solicitor) - is the management / housekeeping / what-happens-next stage of the process made to appear so very complicated and intimidating?

I say nothing of how the average (or indeed any) LiP is to access or make head or tail of the pro forma directions with which they are presumably intended to arm themselves and amend as appropriate before appearing before the Court.  The intention may be it will be made available on the FRU website – time will tell. 

I should have expected – based on nothing more concrete than my own experience – that the approach to case management might be more informed by the case with which the court is dealing.  The arithmetic goes something like this:

One house, one income, two parties to a marriage, and probably some children to be looked after = simple directions. 

Five houses (three abroad, two owned by a trust and one by a BVI company), one hedge fund (loss making, natch), no “income”, huge alleged (and disputed) tax liabilities, an offshore trust and a pension fund and lifestyle issues (and probably some children to be looked after) = complicated directions. 

Or am I missing something?

3.       The clerk in Court is responsible for drawing up the Order

Hmmmm….  Not quite sure how this is new or, if it is, when their responsibility for doing under existing practice actually ceased. 

4.       Directions can be agreed between the parties to avoid an unnecessary attendance at Court (the accelerated FDA procedure). 

Definitely one for the lawyers, this one. 

Most sensible solicitors will have sought to agree directions, where possible, in advancing of rocking up to court.  Whilst I understand what the rules are attempting to achieve (active judicial case management with an eye to costs overall), when did it become the case that only a District Judge was deemed capable of determining appropriate and proportionate case management directions, requiring the parties and their solicitors and (where appropriate, or even where not appropriate) their Counsel before them in Court to do so?    What greater waste of costs could there be where matters had already been agreed? 

So, good!  A way to address this issue where there is agreement as to appropriate case management.    

The new accelerated procedure requires the submission of directions, agreed in every respect.   An exception to this may be in relation to a discreet questionnaire point – they will not otherwise, we are told, approve agreed directions in general terms that require replies to a questionnaire subject to a “save for just exception” provision.

But, the new accelerated procedure requires the submissions of agreed directions so far in advance of the scheduled FDA – at least fourteen days, see paragraph 2(ii) - that I wonder how often it will be possible to fulfil its criteria.  I am informed that although the FRU has been in operation since January (seriously, was anybody really aware of this?), no applications have yet been received under the accelerated procedure.

As a point of interest, in discussions about the FRU’s operation it was suggested to me by representatives from the judiciary and Bar (in my capacity as the only person present at the time who had ever actually prepared a Form E) that “if only solicitors didn’t take so long to produce Forms E, there would be no issue with early agreements being reached”.  Obviously, it couldn’t be our clients who are responsible for that delay, or compliance with the rules, or pension providers taking an age to produce documents, or likewise banks in providing copy statements or……

So it must be the "other profession".  QED.

5.       FDAs and FDRs will “never” be listed in the floating list

I think we all know this is unlikely to be true in the future, just as it has been untrue in the past.  The change of name of the floating list to the “unallocated case list” (or similar) doesn’t mean that they are not floating.   

6.        MPS hearings to be listed for an hour within 28 days

Hurrah!  Let’s hope they’re not floating (in the “unallocated case list”) on the day - they are not included in “never to be in the floating list” commitment made in respect of FDAs and FDRs.

7.        Targets (NOT deadlines) for the listing of FDRs and hearings

Hurrah again!  Slightly concerning, however, that all of these hearings are supposedly to be divvied up between only seven dedicated FRU Judges and some deputies.  Maybe they will sit outside their core hours, extend the court day or sit on weekends?  Hmmm again.

8.        Forward-looking costs budgets at FDA and FDR 

Hurrah (I think), but does a Judge really need these to repeat their time-honoured and well-rehearsed homilies about the parties’ hard-earned dosh only going to the lawyers if they don’t agree?  Judges seem increasingly to me to have such short memories about lawyers’ charging practises, but I digress... 

Having asked the question specifically, I am assured that these will not be “Jackson-type” budgets for which there are very severe consequences under the CPR 1998 if they are inaccurate or even late.  But for how long will that remain the case?  Other than giving the parties something to think about and / or the lawyers a bollocking, I wonder what purpose these are actually intended to serve? 

I presume that this “rule” will only apply in those cases where at least one of the parties is legally represented, but who knows?

Random thoughts, as I said.  Don’t start me on the whole mandatory orders thing!

Another random thought for those of you practising in “high net worth” work (this used to be called “big money” – another rebrand):  there appears to be little expectation that cases might require to be heard by a High Court Judge, and therefore limited facility for the transfer of proceedings after issue.  Paragraph 6 of the FRU Procedure requires parties to make any transfer application at the FDA stage. 

The alternative proposed is compliance with the President’s Guidance of 1 December 2009.  I have not been able to find that guidance on-line or in the current version of the Red Book, but it is reproduced in “At A Glance” - not a resource I expect many LiPs to have about their person.  The Guidance likewise supposes most transfers will be considered at FDA stage although paragraph 4 contemplates transfers to a High Court judge prior to FDA, but only on submission of a certificate completed by “both Counsel or, if Counsel are not instructed, solicitor(s) for the parties” stating concisely why the case is suitable for a High Court Judge.  That certificate must be filed at least twenty-one days before the date fixed for the FDA, and will be considered by a High Court Judge who will determine whether, prima facie, the matter is suitable for hearing at that level.     

The Guidance is well-hidden from those without specialist resources.  Although I wonder how many LiPs will be exercised about the eminence of the Judge before whom they are to appear, they will struggle to find it, and, when they do, are unable under its terms to self-certify.  Why this transfer process has not been reviewed as part of the FRU’s operation is beyond me.  I imagine that we will continue to seek a transfer at the FDA, but that this is something which will always require attendance at the FDA.  I note that it is not a direction included in the standard draft order, so we must presume that very few such applications are expected. 

If anyone has any suggestions about how better to manage commencing suitable cases before High Court Judges, answers on a postcard please. 

One very good thing is that the User Group convened by HHJ Martin O’Dwyer to consider the operation of the FRU is intended to continue to meet periodically, so there is a conduit for our experiences of the scheme in operation to be put to those responsible for administering it.  Feel free to send these thoughts to me by e-mail (mheathcote@bishopandsewell.co.uk) and / or via the London Region Resolution Committee via our micro-site, or and or by Twitter (@ResLondon).  I will ensure that those experiences – good, bad or indifferent – are conveyed to the powers-that-be.  
We live in interesting times indeed.

Yours, Chairman Ag