By Legal Futures Associate Integrated Dispute Resolution
On 29 October 2021, the President of the Family Division published a report on Transparency in the Family Court after an extensive review of the issue. It tells us that in 2020 there were 224,902 cases in the family courts in England and Wales. Many of those decisions were based on judges or magistrates exercising their discretion which is based on them representing the social and other value judgements of society.
While the current Family Proceedings Rules permit accredited representatives of the press to be present in court during private proceedings (and a recent pilot scheme allows legal bloggers to also attend court), the reality is that if the proceedings concern children, section 12 of the Administration of Justice Act 1960 prevents the publication of information relating to such proceedings. The case of Clibbery -v Allen [2002] EWCA Civ 45 (in which the writer represented Ivan Allen) is still good law and restricts the publication of confidential financial information disclosed in financial remedy proceedings unless specific permission is provided by the Court. The current reality therefore is that it is rare that members of the press actually attend hearings in the family courts as they are unable to publish anything which would essentially make a good story, mainly because they are not entitled to have copies of the documents filed within the proceedings.
That may, however, soon change – and not for the better. In his Transparency Report, the President sets out that it is in the public interest to know about the decisions being made in the family court in order to have a basis for trust in what is being decided – and without it there are accusations of a secret court with the conclusion that what is being decided and the approach of the court is unfair, unsound or wrong.
There is clearly a very strong argument for understanding the basis and rationale for decisions being made by the State concerning the removal of children from their homes (public law cases). Why and how, however, can it be in the public interest for details of the financial ramifications of a divorce to be reported in the press?
On the same day as the Transparency Report was published, Mr Justice Mostyn and HHJ Hess launched a consultation on a proposal to introduce a Standard Reporting Permission Order (“RPO”) to enhance the transparency of and public confidence in financial remedy proceedings in the Financial Remedies Court. The Consultation period runs for less than a month with comments invited by 26 November 2021. It has the approval of the President.
The proposal is that in every financial remedy case started at court, a RPO will be issued by the court as a standard step and reviewed at the First Appointment hearing. The RPO sets out that journalists/legal bloggers are entitled to have sight of the key financial documentation subject to strict conditions – namely the documents are only provided to the journalist and their staff/editor and they must be destroyed 6 months after the case is over.
So, what does this mean in practice?
The proposal is clear. Members of the press will be allowed to publish names and photographs of the parties (as they are currently allowed to do), a description of the factual or legal issues in the case including any open proposals for settlement, quotations from the documents filed in the proceedings including from the parties’ witness statements, position statements or voluntary disclosure and a summary of the judgement disposing of the proceedings.
The press will be entitled to be given the documents filed in the case although they are not entitled to name the children nor publish a photograph of them, and they cannot refer to the detailed financial information of the parties unless it is already in the public domain. The RPO sets out that it is possible to refuse to provide copies of documents on the basis that the request to obtain the information is unfocussed, exorbitant or disproportionate.
This is a real sea change. It means that members of the press will be provided with private financial information disclosed in the family court proceedings although they are only entitled to publish a broad description of the types and amounts of assets and income and other financial resources of the parties without identifying the actual assets themselves. The press will also be entitled to report on the open proposals made in the case although they must provide only a broad description of them giving only the monetary value of the proposals.
What is the likely effect of this?
Firstly – it seems likely that this will encourage more clients to avoid the court process and instead consider arbitration and other methods of out of court dispute resolution to resolve matters. The writer is in favour of avoiding court where at all possible. Collaborative law remains an excellent way of resolving disputes particularly when there are children involved. The collaborative process involves both parties and their lawyers signing up to an agreement to work together to reach a financial agreement. There are a series of meetings where everything is discussed together. Legal advice is given in front of both parties. Third party professionals such as accountants and financial advisers can attend the meetings and provide information to both parties and their lawyers together. It is far more cost effective than litigation. It promotes discussion and dialogue. In the unlikely event that a financial agreement cannot be reached, both parties have to sack their lawyers and instruct new lawyers to go to court.
Another way of avoiding court is arbitration which is essentially private justice. The parties agree to arbitration and choose an arbitrator (or if they are unable to do so, an arbitrator can be appointed by the Institute of Arbitrators). The arbitrator will then provide directions on the future of the case (making financial disclosure, valuations of any properties or businesses, pensions reports etc). The arbitrator will ultimately decide the case having heard evidence (if they feel it necessary), and having been addressed by the parties on the matters in dispute. Arbitration is completely private and confidential. It is also much quicker than a contested financial remedy case which inevitably means it is more cost effective even though the parties have to pay the cost of the arbitrator.
Mediation is still a good option to try and resolve matters outside of court. There are also private Financial Dispute Resolution hearings where a third-party private Judge will provide their view on what a reasonable financial order should be.
he fact remains that there are, however, still some cases where it is in the client’s interest to start financial remedy proceedings at court. Take the non-disclosing husband where the wife has no knowledge of the couple’s finances, where it is necessary to have the court’s powers to ensure that financial disclosure is obtained even if that means from third parties, such as accountants, bankers etc.
The consultation seems designed to drive people away from the courts and into the arms of private justice. Yet how can this be fair for the people who can’t afford to pay for a private arbitrator or a private judge? While it could be argued that the national press wouldn’t be interested in the divorce and financial affairs of the ordinary person, local publications would be and there may be adverse reasons why a local publication may want to publish details about the divorce of someone in the local community.
Secondly, it seems highly likely that the terms of the draft RPO will result in satellite litigation i.e. asking the court to rule on whether a request for documents from the press is exorbitant, unfocussed or disproportionate (being the test on which a request can be challenged). In high profile cases in particular, clients will not want the press to receive any information or documents regarding their personal private affairs. The writer can foresee a high-net-worth individual making as many applications as are necessary to try and prevent this – which will no doubt in itself lead to the press then reporting on this.
While the consultation proposal and RPO sets out that the press are only entitled to publish a broad description of the assets, liabilities, income and other resources without identifying the actual items, how is this in a client’s interests? The writer has acted for individuals who are secretive about their finances, even from their own adult children. An individual has a right to their private life and what is more private than financial information. It is often the case with high-net-worth clients that their financial affairs are complex and assets may be owned through a myriad of legal entities. If the press are entitled to receive full details of an individual’s financial information provided in the proceedings, which would include full details of the web of corporate entities through which their wealth is owned, even though the press are prevented under the RPO from publishing the detail of those assets, it is then a simple matter of forensic investigation and time at Companies House to ascertain what is in the public domain, leading to publication of the material. In that way, the press are not breaching the RPO but will have used the information provided to them to ascertain what is in the public domain.
The key question remains: How can it possibly be in a client’s interest and, indeed, in the interest of the children of the divorcing couple for details of the divorce to be published? While the RPO prevents the names or schools of children to be published, the children will inevitably know if their parents’ divorce is in the press; their friends will know; they will be questioned and could be bullied about it.
The President makes plain in his Transparency Report that he has taken on board the views of children and young adults who would not want their details to be published in cases involving their care and wellbeing. Surely their wellbeing will be prejudiced if details of their parents’ divorce, to include their open positions on who gets what, is in the press.
Written by Elizabeth Hicks of FLiP (Family Law in Partnership).
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