Dispute resolution — Pre-action procedures overview
Dispute resolution processes
Recording a settlement
Authored by Justin Dowd, Partner, Watts McCray. Updated by the LexisNexis Legal Writer team.
Pre-action procedures summarisedAs the vast majority of family law cases commence in the Federal Circuit Court, all parties are expected to follow the pre-action compliance requirements as set out in the Family Law Act 1975 (Cth). Every Initiating Application is expected to have a s 60I certificate from an accredited Family Dispute Resolution (FDR) attached and where such a certificate has not been obtained, an Affidavit – Non-Filing of Family Dispute Resolution Certificate should be attached.
In this regard, the lawyer is expected to advise the client of the best way to resolve the dispute, including considering what a reasonable settlement option might be, or the likely cost if the matter were to run to trial. The lawyer should also advise the client as to the availability of Legal Aid assistance and the range of FDR services.
Before starting any litigation, every potential party is required to make a genuine attempt to resolve their dispute, whether it concerns property, children or both types of matters, by participating in a family dispute resolution (FDR) process. This procedure may be relatively informal and inexpensive if done through such services as Relationships Australia or more formal if conducted by an arbitrator and involving more complex family or business situations.
Every lawyer should encourage their client to avoid commencing litigation for both financial and pragmatic reasons, namely:
- •the escalating cost of protracted litigation;
- •the emotional cost to the litigant and children of long delays in resolving a dispute;
- •the potential damage to children involved in a parental dispute; and
- •identifying the real issues in dispute between the parties to enable early resolution.
Every matter should commence by the lawyer writing to the other party, indicating that their client is considering taking further action and inviting them to attend a family dispute conference with a nominated mediator and including a copy of the court’s pre-action procedures.
Usually there is an exchange of correspondence between the lawyers indicating the orders sought by their clients before an FDR conference and these responses can identify the key areas of difference between the clients.
Schedule 1 Pre-action procedures of the Family Law Rules sets out the process in detail to be followed by litigants and the obligations of lawyers in advising their clients. The Family Law Act 1975 (Cth) (the Act) requires the applicant to obtain a certificate from a registered family dispute resolution practitioner before filing an application for an order in relation to a child under Part VII of the Act. In parenting cases, each party is likely to seek varying orders in relation to the parental responsibility, residence and time spent with the children.
Property disputes require the parties to make full disclosure of relevant information such as a schedule of assets and liabilities, three most recent taxation returns, and superannuation interests. Typically, a party will provide a written appraisal of the value of real property and a completed superannuation form for the superannuation fund. Other relevant documents may include in the case of a self-managed super fund, a copy of its trust deed and three recent taxation returns, and similar information in respect of any business associated with a party. Documents produced in response to this preliminary disclosure process may not be used for any purpose other than resolving the dispute between the parties.
There are limited exceptions to the requirement to attend FDR, particularly if there are allegations of family violence but also in cases of urgency and where there is a genuine dispute as to whether there was a de facto relationship in existence. Where a party does not attend FDR after having been invited, the FDR practitioner may nevertheless issue a s60I certificate indicating the reasons that the conference did not occur and this will enable the applicant to commence proceedings.
Compulsory family dispute resolution — parenting casesIn relation to parenting matters, Pt VII Subdiv E of the Family Law Act makes it compulsory, subject to certain limited exceptions, for parties to meet together and to confer with a family dispute resolution (FDR) practitioner before proceedings can be commenced. See Compulsory family dispute resolution. See also Sch 1 Pt 2 of the Family Law Rules 2004.
Applicants must file a section 60I certificate prepared by a family dispute resolution practitioner with the Initiating Application to start a parenting case in the Family Law Courts.
Pre-action requirements under the Family Law Rules — all casesIn relation to financial matters, parties and their solicitors must comply with the pre action procedures listed in Sch 1 Pt 1 of the Family Law Rules. See Pre-action requirements under the Family Law Rules 2004 (Cth).
The Family Law Rules also provide that there may be serious consequences, including costs penalties, for non-compliance with these requirements: see rr 1.10 and 11.02(2). Costs orders can also be made against a lawyer by reason of the lawyer’s failure to comply with pre-action procedures: see r 19.10.
The rules which apply to pre-action procedures can vary between the Family Court, the Federal Circuit Court, and the Family Court of Western Australia. Care must be taken to ensure compliance with the Rules of the court in which proceedings are to be instituted.
The Family Court of Western Australia is regulated by the Family Law Rules 2004 but only as adopted and applied in Western Australia and also by the Case Management Guidelines (available on the Court’s website).
There are a number of dispute resolution processes available to parties to assist in the resolution of any dispute, some of which are only available to parties with legal representation (e.g. legally assisted mediation). The role of the family lawyer includes identifying and pursuing any dispute resolution process which might be of assistance to the parties. See General requirements of pre-action procedures Sch 1 Pt 1 of the Family Law Rules 2004 (Cth).
Those processes include:
- •Counselling;
- •Mediation;
- •Arbitration; and
- •Collaborative Practice.
Practice Tip: FDR is available for both parenting and financial matters. Family Relationship Centres tend to focus on parenting matters while private practitioners are mostly used for financial matters. The Federal Circuit Court has also introduced a judicial mediation process as an option when other dispute resolution processes have been unsuccessful.
The role of the lawyer includes identifying and pursuing any dispute resolution process which might be of assistance to the parties. See Lawyer’s Obligations in Sch 1 pt 1 of the Family Law Rules 2004.
Once an agreement is reached between the parties, the role of the lawyer is to advise their client on how to document that agreement to ensure that the terms of the agreement are comprehensive and that the client's interests are promoted and protected.
There are a number of options available to parties in which to document an agreement reached, including:
- •parenting plans in respect of children (see Parenting plans);
- •an Application for Consent Orders and terms of settlement (see Consent orders);
- •financial agreements (limited and binding) (see Financial agreements generally); and
- •child support agreements (see Child support agreements).
One or more of the above options may be used to document the agreement. For example, an agreement may include:
- •parenting care arrangements;
- •property settlement;
- •spousal maintenance; and/or
- •child support.
An Application for Consent Orders may deal with the parenting and property settlement while the child support can be dealt with in a child support agreement and spousal maintenance in a financial agreement.
Dispute resolution is a broad term which refers to a range of processes whereby an impartial third party assists those involved in a dispute to resolve issues between them. The range of processes is virtually limitless but generally involves the dispute resolution practitioner being an independent person, having a facilitative, advisory or determinative role. Commonly known dispute resolution processes include arbitration, mediation, counselling, and collaborative practice. Dispute resolution processes can involve more than two parties and may or may not involve lawyers.
Dispute resolution processes were previously known as “alternative dispute resolution”. They were considered “alternative” as they offered a way of resolving disputes without resorting to judicial determination. In practice, dispute resolution processes are often a good starting point for parties to attempt to resolve the issues without the need for legal intervention. Although of course if an agreement is reached it is always recommended to have the agreement legally documented by a lawyer. If a final resolution is not reached, parties can always progress from dispute resolution to court action subject to limitation periods.
In Western Australia, since 9 April 2012, all property matters where both parties are legally represented are expected to consider arranging private mediation, alternative dispute resolution or mediation-style conferencing and be in a position to advise at the initial procedural hearing as to whether or not such conferencing has been arranged. If they have attended and any genuinely attempted to resolve their matter, the parties can apply to be exempted from the requirement to attend a Conciliation Conference which effectively expedites the matter. To do this, the parties need to hand up to the judicial officer at the first return date a summary of the issues in dispute and any issues which have been agreed.
The main advantages of dispute resolution are:
- • it is a relatively quick, inexpensive way of resolving disputes;
- • parties have greater involvement and control in the process;
- • parties are free to define the issues according to their own viewpoints;
- • solutions can be developed that would not necessarily be offered by legal remedies (particularly in collaborative practice);
- • unlike the adversarial system, dispute resolution can deliver a “win/win” outcome;
- • the process and its outcomes can remain confidential; and
- • there is a focus on trying to maintain a good quality relationship between the parties (this can be particularly valuable where parties will continue being involved as parents long after separation).
Sometimes it can be to the advantage of one party over the other party to delay the institution of proceedings. Care must be taken to ensure that the dispute resolution processes are pursued by both parties making a genuine or bona fide effort to resolve matters and that those processes are not being pursued to delay or frustrate court proceedings. But both parties are required to make a genuine effort to resolve their differences before instituting proceedings.
It is important to note that dispute resolution processes will not oust the jurisdiction of the Family Court. A person always retains the option to settle issues or seek orders in the courts if they are unable to reach an agreement during a dispute resolution process. Mediators and solicitors representing parties in a collaborative dispute resolution process cannot later represent a party in court if the matter proceeds to litigation.
The court is under a positive obligation to inform parties about alternative methods of resolving disputes including dispute resolution and counselling services. See s 62B of the Family Law Act 1975 (Cth).
A lawyer is also under a positive obligation to provide their client with information regarding dispute resolution and services that are available to assist parties in resolving their disputes without recourse to judicial determination and in adjusting to the consequences of particular orders. See Information to be provided to the client.
If there is a history of family violence, it may not be appropriate for parties to participate in counselling or dispute resolution processes. Safety should always be a main priority. See the Family Violence Best Practice Principles released by the Family Court of Australia.
Parties often reach an agreement or “settle” their parenting and financial arrangements before a matter proceeds to the final hearing stage. Parties will need to have a document which reflects the terms of their agreement. Having a written record ensures that all parties are clear as to their rights and responsibilities. It also provides clear proof of the terms of the agreement should a dispute arise in the future and depending on the way the document is captured could also provide a mechanism through which the terms of the agreement can be enforced against the other party.
The way a settlement is recorded can be determined by the way settlement is reached.
Parenting plansFor children's matters, parents often work together informally and negotiate agreements amongst themselves. Whilst there is no need to put an agreement in writing, if is in writing and signed by the parties it can become a parenting plan. Alternatively a parenting plan can be drawn up. Parenting plans tend to only be used if legal proceedings have not commenced as they are not enforceable.
They also have the legal effect of overriding consent orders that exist at the time the parenting plan is entered into. Many clients may unwittingly enter into parenting plans to appease the other party falsely believing that the court orders will trump the parenting plan. It is important that practitioners advise their clients so any decisions made after courts orders are properly informed.
See Parenting plans.
Consent ordersFor both children's and financial matters, parties can reach an agreement outside the court yet still wish for their agreement to be legally binding. In these circumstances, the parties will make an application to the court for consent orders. The court will make orders reflecting the terms agreed upon between the parties. These orders will be legally binding.
Strictly speaking, financial agreements are a form of consent orders. They can be entered into before, during or after a marriage or de facto relationship. However, given that they are used in very specific circumstances, they have been covered separately in Financial Agreements.
Financial agreements can be used to record an agreement in place of consent orders in financial matters.
See also Financial agreements.
