The Judge As Deal-broker ' Should You Try A Chancery FDR?

• Published date: 12 August 2021
• Subject Matter: Litigation, Mediation & Arbitration, Arbitration & Dispute Resolution
• Law Firm: Gatehouse Chambers
• Author: Ms Charlotte John

Court based ADR hearings, where a judge attempts to assist parties to reach terms of settlement, are on the rise. This is a concept that has been around for some time but which appears to have been embraced with greater enthusiasm since the pandemic as a solution to the backlog many courts are struggling with in the hope that, with some encouragement, parties might be able to resolve their disputes without the need for a trial.

There are two principal types of judge-led ADR processes that are useful for you to consider. The first is early neutral evaluation ("ENE") properly so called. The second is the Chancery FDR ("Ch FDR"). Both will be conducted on a without prejudice basis with the judge who conducts the hearing playing no further role in the proceedings beyond giving directions at the end of the hearing, if required.

Classic ENE involves the court offering an opinion on the outcome, with or without hearing oral submissions. It is perhaps best suited to cases where there is no substantial dispute of fact but rather a question of law or construction. There is a view that ENE is perhaps not the most fruitful process. It simply leads to a non-binding opinion, with no additional input from the judge, and which the 'losing' party is not obliged to pay any heed to.

A Ch FDR has much more to commend it. An FDR is a judge led negotiation exercise in which the judge plays the role of both facilitator and evaluator. The judge will ordinarily offer an opinion, or indication, of the likely outcome of the dispute, or an element of it, having heard argument from the parties on their respective positions and will also endeavour to help to guide the parties towards a solution. Following ENE or a Ch FDR, the judge who conducted the hearing can play no further role in the proceedings, beyond giving directions at the conclusion of the hearing if settlement is not reached.

The procedure has developed out of the financial remedy jurisdiction, where it is all but compulsory and phenomenally successful (something like 8 out of 10 cases will settle at FDR). There is no one type of case that is amenable to a Ch FDR but it is particularly well suited to cases that concern the untangling of a relationship (whether personal or commercial) or where there will be a continuing relationship or where there is an estate or asset to be realised and distributed.

The Chancery Guide suggests that they court will not direct either ENE or a Ch FDR unless the parties are in agreement...