The Financial Dispute Resolution Hearing (FDR) is usually the second court hearing that takes place within court proceedings dealing with the financial aspects of a couple’s divorce. Before this hearing both spouses should have provided their financial disclosure and if expert reports are needed, such as valuing shares in a business or calculating the percentage pension share required to give equality of pension income on retirement, these should have been obtained.
The FDR is essentially a hearing where the couple try to negotiate a settlement with the help of a judge now that they have all the information. The judge cannot force the couple to agree a settlement at the FDR hearing but can guide and encourage them.
14 days before the FDR hearing both spouses should make proposals for settlement. This is so that both sides know where the other is coming from in advance of the hearing and have chance to consider the issues between them and how these may be resolved before the court hearing.
The judge at the FDR will see copies of these offers and the main financial documents and experts’ reports before the hearing. They will also receive a detailed note from each spouse’s legal representative detailing the issues and the spouse’s views on these issues.
The FDR hearing is “without prejudice”. This means that all comments and offers made at this hearing cannot be repeated to a judge at any other hearing including a contested final hearing, which would take place after the FDR hearing if an agreement cannot be reached. This is to help facilitate sensible and pragmatic negotiations which will hopefully enable the couple to agree a settlement.
On the day of the FDR both spouses and their legal representatives are usually ordered to attend court at least one hour before the court hearing. This is to enable negotiations to take place to see if issues can be narrowed or even a settlement reached at that stage. If negotiations are progressing the judge may give more time for these to take place.
The couple will not negotiate directly with each other. Instead, each will be in their own meeting room with their legal representatives. Outside of those rooms their legal representatives will meet to discuss offers and counter offers they have been instructed to make.
If it is clear that a deal cannot be done at that stage, the couple and their legal representatives will go before the judge. Neither spouse will give evidence. Instead, their legal representatives will put forward more details regarding each spouse’s case and ask the judge to provide their views on the issues. Whilst the judge has not heard evidence, they can still form a view of what a fair settlement will be and advise the couple of this. The couple are then encouraged to have further negotiations outside of the court room, taking on board the judge’s comments.
If an agreement is reached a draft order is prepared by the legal representatives and once approved by the couple is presented to the judge for their approval. Hopefully the order is approved (it would be very unusual for it not to be) and the couple will then have a legal and binding financial order.
If the couple do not manage to reach an agreement the judge will timetable the matter to a final hearing, where both spouses will give evidence and a settlement will be imposed upon them by the judge at that hearing.
There is nothing stopping a couple continuing their negotiations after the FDR hearing. Sometimes a couple get so far in the negotiations on the day of the FDR and then run out of time or one of them needs to spend a little time thinking about matters before they agree to an offer. Further negotiation is encouraged. Many cases settle at the FDR hearing or shortly thereafter.
The FDR hearing is a very important hearing and it is therefore important to have experienced legal representation to guide you through it effectively.
