The Financial Remedies Court efficiency statement was issued with the approval of the President by the lead and deputy lead Judges of the Financial Remedies Court on 11 January 2022. The efficiency notice is a key document that all financial remedy practitioners should be aware of; the ‘Primary Principles’ document is likely to be referred to in all Financial Remedy hearings going forward. New requirements have been introduced at all stages of Financial Remedy proceedings in an attempt to ensure and improve efficiency and effectiveness. These rules do not replace or amend the Family Procedure Rules and do not apply to cases at High Court level, which continue to be governed by the Statement on the Efficient Conduct issued by Mr Justice Mostyn on 1 February 2016.
The key changes are summarised below:
Stage: On issue
- Every application must be accompanied by the filing of an FRC Allocation Questionnaire (“FRC3”) unless wholly impractical.
- The questionnaire should be completed in accordance with guidance contained within Schedule 2 of the new Primary Principles of the FRC.
Stage: First appointment
- FAs shall now normally be listed for 45 minutes.
- FAs for cases designated as complex shall be listed for 60 minutes
- In exceptionally complex cases, parties must indicate on their FRC3 that longer than 60 minutes is required. This is subject to the consideration and approval of the court.
- If the court is notified in advance, then the hearing can be used as an FDR and more time will be allowed.
- Where the parties notify the court in advance that there is scope for the FA hearing to be used as an FDR, a longer listing time will be afforded.
- The court may fix a final hearing date at FA.
Two weeks before the FA
- The following information should be filed 14 days before the FA (if the FA is being used as an FDR then it must be filed):
- A jointly obtained market appraisal of each property currently used as a family home owned by the parties. If a joint appraisal can’t be obtained and each party files their own appraisal, they should expect to explain the impossibility of a joint valuation.
- Three sets of property particulars for each party and a brief jointly obtained indication of borrowing capacity. If the parties are not able to get a joint indication, they should file individual indications.
- Questionnaires not exceeding four A4 pages. In cases where there is a high degree of complexity, longer documents may be allowed.
Day before the FA
- The applicant must file:
- A composite case summary using the new template; and
- A composite asset schedule based on Forms E using the new template provided.
- The new case summary encapsulates the chronology and case summary, thereby eliminating the need for further documents to be filed to comply with PD27A.
- Parties are encouraged to try and agree directions on paper.
- Schedule 4 of the FRC Primary Principles document includes a procedure and a draft order for the court to approve an agreed directions order.
Stage: Private FDR
- If a private FDR is agreed the order should: identify the ‘evaluator’ or the identity of the ‘evaluator’ shall be determined at the FA; and, should say that the FDR may only be adjourned by agreement or order. A mention hearing should also be listed.
A week before the FDR
- The applicant needs to file an updated composite case summary, asset schedule and a composite chronology.
- The court will be expecting practitioners to adopt a collaborative approach in light of the warning given:
“It is unacceptable for the court to be presented at the FDR or final hearing with competing asset schedules and chronologies”
- FDRs will normally be listed for 1-1.5 hours but parties and their legal representatives must be available for the entire day.
Stage: Final Hearing
- A PTR should be timetabled 4 weeks before a hearing listed for three days and before the trial judge (if judicial availability permits)
- A final hearing template and timetable must be prepared for all cases which allows for the following:
- Allows for judicial reading and judgment writing time
- Does not allow longer than 30 minutes for opening
- Does not allow for any evidence in chief
- Advocates are expected to comply with the timetable, “slippage will not be tolerated unless there are very good reasons”.
- The applicant must file an updated agreed composite case summary, asset schedule and chronology by way of composite documents.
- The efficiency statement takes the opportunity to remind us that:
- Section 25 and other witness statements must comply with the principles in the President’s Memorandum on witness statements dated 10 November 2021; and
- PD27A must be strictly complied with in terms of bundles, and e-bundles should comply with the General Guidance on PDF Bundles dated 29 November 2021 as modified by the guidance dated 21 December 2021. (Note that pagination is now continuous for e-bundles and that we no longer use section letters in pagination.)
It seems the FRC has lost tolerance for late documents and non-compliance; advocates will note the stern warning about noncompliance without reasonable excuse with the efficiency notice’s rules for: 1. Agreeing asset schedules and chronologies; 2. Length of position statements; or 3. (Crucially for many advocates) the time for filing position statements. The efficiency statement includes that any advocate breaching these rules “will risk an order being made disallowing a proportion of their fees”. Accordingly, practitioners instructing counsel for financial hearings can expect a widespread push to receive papers – and in the case of the FDR, WP offers – well in advance of hearings.
- The lead Judge of each Financial Remedy zone is to issue local guidance; details of leads can be found on the FRC Organogram: https://www.judiciary.uk/wp-content/uploads/2021/10/Financial-Remedy-Court-Organogram-Nov-2021-published.pdf
Position Statements, Counsel’s Notes and Skeleton Arguments
- Must be filed by 11am the day before the hearing and exchanged within an hour.
- Must not exceed (unless application made and granted to exceed the limits):
- 6 pages at FA
- 8 pages at any other interim hearing
- 12 pages at FDR
- 15 pages at final hearing
- The court will want to know at every hearing whether there has been compliance with the requirement to negotiate openly and reasonably.
- Position statements must contain brief outlines of the efforts of the parties to negotiate openly, reasonably, and responsibly.
- Failure to make reasonable efforts to compromise in open negotiations, will result in cost penalties, irrespective of the value/complexity of the case.
- The FRC has continued its drive to avoid practitioners spending disproportionate amounts of time agreeing orders.
- The standard order templates, avoiding summarising what happened at hearings or recording the parties’ positions at the hearing.
- Orders should be lodged on the day of the hearing if remote, and for attended hearings they must be lodged before leaving court or within two working days.
- Hearings should not start before 10am and should end by 4.30pm. We cannot expect emails sent outside these hours to be answered by the court; nor should we expect emails sent to other practitioners after 6pm to be answered before 8.30am the next day.
- Document filing is increasingly being dealt with through the HMCTS online portal, the Digital Contested Cases System.
Written by Natasha Khalique, Pupil Barrister, Unit Chambers