Financial Consent Orders in Mediation

One of the criticisms that have historically been levelled at mediation is that it does not provide finality for family finances. That is not true or fair at this point, as mediators can set out a full pathway to a final settlement, especially since they can now provide the first draft of a document that can be turned into Financial Consent Orders – a binding court order.

Back in the summer of 2019, family mediation’s governing body, the Family Mediation Council, (FMC) gave the green light to this change. There has perhaps been less publicity about this evolution in how mediators work than might have been expected.

Financial Consent Orders before 2019

Traditionally mediators only drafted very top-level financial agreements. These basic summaries of intent then had to be reshaped by solicitors into much tighter and more detailed legal wording, as they had to fit the formalities of a draft court order. Sorting out long term financial arrangements, especially relating to property and pension issues, can be very complex. A draft court order, which then has to be approved by a judge, must be as well drafted as if a judge themselves had handed down the same terms after a fully contested hearing.

Before 2019, many solicitors would struggle with the expanding and reshaping process of the ideas formed in mediation. There was often not enough detail from the mediator’s memorandum to make every part of the arrangement watertight. This would mean having to have secondary negotiations of the fine-tuning and the details. As indeed ‘the devil is in the detail’, some arrangements fell apart at this stage. It was frustrating for participants who thought that they had ‘sealed the deal’, to find themselves being presented with choices, with both naturally wanting the option more favourable to them. It is also not hard to see how, if they are already experiencing an element of ‘buyer’s remorse’ about the overall terms, they may decide that even a minor extra concession or two would be a step too far.

Financial Consent Orders since 2019

Over the last few years, since being approved by the FMC, mediators themselves can draw up the first draft of the financial consent order. The mediation participants are taken through the drafting details that are needed during the meetings, based primarily on the judicially approved standard precedents. The initial draft of the consent order, based on these mediated discussions, will then be included in the mediator’s normal memorandum. So the only difference is not one of structure, but of providing a more granular level of detail in practice. There are two advantages to this approach.

Less negotiation and drafting

Firstly, the solicitors who advise the individuals about the ultimate terms of the consent order will need to do much less additional negotiating or drafting of new terms that were not discussed before. This will mean that there will be less threat of undermining the progress contained in the main provisions that were agreed in mediation.

Greater client agency

The second advantage comes about because, previously, the parties could feel more marginalised during the drafting of the secondary terms by their solicitors. The dynamic shifted around with the solicitors being in control of this process, not the clients themselves. These clients can now have greater agency throughout, as the mediator will take them through the more nuanced or technical issues whilst they are there together and facilitate a resolution to any issues that arise from them. It is much better to spot issues that make the proposals unworkable or unpalatable in mediation, than when the mediation process has come to an end.

A better outcome for mediators and clients

Of course, the parties must be allowed to make any amendments to the draft created by the mediator even after it has left the mediation process. It is hoped that these changes will now be minor, rather than a complete reworking or unravelling, as the parties have invested so much in the process of considering the detail already.

So mediation can indeed lead clients through to getting a consent order, providing a full and binding outcome on financial matters. It can be an arrangement that is truly tailored to their individual needs, as the participants have been able to be so involved in all stages, from working out the main ideas to considering the workable legal terms that will make their settlement watertight.

Caroline Bowden

csb@anthonygold.co.uk

Family Mediation Week takes place from 17 January 2022 and Anthony Gold is offering free mediation information meetings (MIAMS) for the whole of January.  For more information please contact either Michelle Howarth at mih@anthonygold.co.uk or Jordan Ridley at jri@anthonygold.co.uk or by telephone on 020 7940 4000.