Giorgia Sessi Archives - Parklane Plowden

The new Express Financial Remedy pilot

Speed, Simplicity, and Sense: A New Era for Modest Asset Divorce Cases?  Justice just got faster- or at least that is the aim. The new Express Financial Remedy Pilot, launched in April 2025, is set to transform how the family courts handle low to mid-asset financial remedy cases. With a streamlined two-hearing structure, frontloaded preparation, and a firm timetable from issue to final hearing, the pilot is designed to cut costs, reduce delay, and make proceedings more proportionate. The pilot is applicable for the next year across key regions in England, and this fast-track scheme is already reshaping expectations. In this article, we explain who it applies to, how it works, and what practitioners need to be aware of when dealing with pilot cases.  Who does the pilot affect?  The pilot is applicable to cases with combined net assets of £250,000 (excluding pensions) after deduction of liabilities and mortgages: in essence, the low and modest assets cases.  The pilot does not affect applications for a variation order under section 31 of the Matrimonial Causes 1973 or Part 11 of Schedule 5 to Civil Partnership Act 2004.  Please note: if, after completion of the Form A and exchange of Forms E, either party believes that the case should not form part of the pilot, they can apply to leave it by lodging a D11. If the court agrees, it will remove the case from the pilot and send a new timetable. When determining whether a case should leave the pilot, the court must consider all the circumstances including whether there are:  <ul class="wp-block-list"> <li>Complex assets or income structures;</li>  <li>Other potentially complex issues;</li>  <li>Other circumstances which would prevent an effective FDR as a first hearing, or where the final hearing is likely to require more than one day.</li> </ul>  What is the aim of the pilot?  The aim of the pilot, also known as the ‘fast-track’ procedure, is to resolve contested financial remedy cases more quickly, by having a maximum of two hearings instead of three, thereby enhancing the efficiency in the disposal of FR cases.  The pilot is implemented through Practice Direction 36ZH, which amends rule 9 of the Family Procedure Rules.  The pilot is structured as follows:  <ul class="wp-block-list"> <li>There is no first appointment.</li>  <li>The first hearing notice (form C) will list a financial dispute resolution appointment, and the following directions will be made: <ul class="wp-block-list"> <li><ul><li>Forms E 28 days before the FDR.</li></ul></li>  <li><ul><li>Agreed property valuations, mortgage raising capacity and questionnaires 14 days after mutual exchange of Forms E. If no agreement on property values is reached, expert report to be obtained.</li></ul></li>  <li><ul><li>Replies to questionnaire and property particulars 28 days thereafter.</li></ul></li>  <li><ul><li>Proposals for settlement 21 days before the FDR. These can be open or without prejudice.</li></ul></li>  <li><ul><li>Schedule of agreed issues to be filed 14 days before the FDR.</li></ul></li>  <li>ES1, ES2 and agreed chronology to be filed 7 days before the FDR.</li> </ul> </li>  <li>The FDR will take place between 16 to 20 weeks from Form A (please note: the pilot does not apply to applications for a consent order, which will continue to be dealt in the normal way).</li>  <li>If the parties reach an agreement, they will be expected to apply for a consent order. Government guidance states that this can be done after the hearing via post; legal represented parties will continue the current practice, i.e. draft consent orders for the court to approve there and then, or Heads of Agreement under Rose v Rose.</li>  <li>If no agreement is reached, the matter will be listed for a final hearing, with open proposals being filed 7 days after the FDR (as opposed to the 21 days required by FPR rule 27A). At this point the court can remove the case from the pilot if appropriate.</li>  <li>The final hearing will take place between 26 to 30 weeks after forms A and will typically last one day.</li> </ul>  Where is the pilot being implemented?  The court areas taking part in the pilot are Cheshire and Merseyside; Cleveland, Newcastle and Durham; Greater Manchester; Lancashire and Cumbria; North and West Yorkshire; West Midlands.  A full list of the pilot areas can be found at paragraph 1.5 of Practice Direction 36ZH and in the government’s short summary <a href="https://www.gov.uk/guidance/what-to-expect-if-you-are-in-the-express-financial-remedy-pilot">here</a>.  When is the pilot taking place?  The pilot automatically applies to cases where the form A is completed between 7 April 2025 and 3 April 2026.  Conclusions and observations  The fast-track procedure has been on the cards for some time, and is a welcome development which, it is hoped, will help resolve modest asset cases in a quick and efficient way and without the need to incur excessive legal costs. Practitioners are all too familiar with cases where the overall costs are almost equivalent to the asset base, and this is often due to delays. It is expected that this pilot will free up time and space for those more complex cases which require a larger share of the court’s resources and are often stuck in the system for months.  Concerns have been raised in respect of the impact that this pilot will have for litigants in person, for whom the first appointment is the first real opportunity to receive an explanation from the court of what is expected of them and the structure of the process (please see the Financial Remedies Journal article by Caroline Bowden <a href="https://financialremediesjournal.com/content/the-express-financial-remedy-pilot-ndash-a-fast-track-to-success-or-turmoil.b0619405797f437da9c6c104a66952ca.htm">here</a>).  The pilot requires a frontloading approach, which practitioners are already familiar with following the implementation of the Efficient Conduct Statement in 2022. The timetable for the fast-track process is even shorter, and it remains to be seen whether experts are able to assist the parties with these tight turnarounds. Under the pilot, it is expected that the case will conclude in the space of around 7 months from issue, and the final hearing to take place around 10 weeks after the FDR. Whilst the value of pensions is not included in the £250,000 limit and therefore a case involving a fairly large pension can still be run under the fast-track procedure, it is expected that, if a complex pension structure is involved and the report of an actuary is required pursuant to the guidance in the PAG report, parties would be advised to apply to be removed from the pilot. This would enable sufficient time for the completion of a PODE report and a proper opportunity to consider its recommendations.  In the event that matters do not resolve at the first hearing and it becomes apparent that the case needs to be removed from the pilot, it is expected that parties will remain at liberty to explore different options such as a private FDR.  Parties and practitioners must not forget the requirement to engage in NCDR. Just because the process is ‘quicker’, it does not mean that this very important step can be missed. Following the implementation of The Family Procedure (Amendment No 2) Rules 2023 on 29 April 2024, parties are expected to engage in NCDR and the court may adjourn the proceedings when this has not taken place, or consider departingfrom the general starting point that there should be no order as to costs if a party has refused to attend NCDR without a good reason. In a modest asset case, a proportionate approach to costs is of the essence and it remains to be seen whether courts will apply an even more strict approach to the above requirement to ensure parties do not become embroiled in unnecessary litigation.  Giorgia Sessi is part of the Family Team at Parklane Plowden Chambers, her profile can be accessed <a href="https://www.parklaneplowden.co.uk/our-barristers/giorgia-sessi/">here</a>.

Roundup of recently reported modest asset cases

As the end of the first week of the Financial Remedies Court (FRC) Reporting Pilot in Leeds draws to an end, what follows is an update of modest asset cases reported in the last six months:  VT v LT [2023] EWFC 256 (B)  <a href="https://www.bailii.org/ew/cases/EWFC/OJ/2023/256.html">https://www.bailii.org/ew/cases/EWFC/OJ/2023/256.html</a>  DJ Hatvany sitting at the FRC in Bristol, 18 December 2023  Core facts:  W (lived in rented accommodation); H (continued to live in the FMH- in his sole name)  18-year relationship with three children (two of which still minor; shared care in place)  Assets:  FMH (four-bed) with net equity of £118,000 (used by H for his business)  Marital debt £33,777 in H’s name and £3,922 in W’s name (plus legal costs)  H’s business, value uncertain but income stream for H who was sole shareholder  Parties’ positions:  W sought a sale of the FMH and a lump sum of £80,000 to buy a shared ownership property, with H to retain all marital debt  H sought to retain the FMH and pay W a lump sum of £45,000 (£20,000 now and balance within 18 months)  Outcome:  <ul> <li>H to retain the FMH (the judge accepted that this functioned as an office for H as well as a home and he could not afford to relocate)</li>  <li>H to pay W a lump sum of £55,000 (£20,000 now and an additional £35,000 within 24 months), with an order for sale in default</li>  <li>H to service the marital debt in his name</li>  <li>Pension Sharing Order in W’s favour</li>  <li>Clean break</li> </ul>  Useful takeaways from this case:  This is a short, ex-tempore judgment similar to the ones we may encounter in our day-to-day practice. DJ Hatvany speaks for the entire profession when he says at paragraph 33: “There is no easy answer. The court can only look for the fairest solution in difficult circumstances having regard to the criteria set out in section 25 of the matrimonial causes act 1973.”  The parties both had responsibilities towards the children of the marriage, and equal housing needs. One of the difficulties was that W’s income was supplemented by Universal Credit and therefore any lump sum over and above £16,000 would have wiped out her entitlement to Universal Credit unless it was utilised to meet her housing needs (hence the shared ownership) within six months (or longer if a sale did not complete). For a detailed analysis of the interplay between financial remedy orders and welfare benefits, the following articles on the Financial Remedies Journal are a must-read: <a href="https://financialremediesjournal.com/content/an-overview-of-the-benefits-system.71b2fff3de2345a7b71ce6a73ed4d5a0.htm">https://financialremediesjournal.com/content/an-overview-of-the-benefits-system.71b2fff3de2345a7b71ce6a73ed4d5a0.htm</a> and <a href="https://financialremediesjournal.com/content/an-overview-of-the-benefits-system.71b2fff3de2345a7b71ce6a73ed4d5a0.htm)">https://financialremediesjournal.com/content/an-overview-of-the-benefits-system.71b2fff3de2345a7b71ce6a73ed4d5a0.htm)</a>.)  The judge opted for a ‘creative’ solution, i.e. a deferred lump sum which enabled H to retain the FMH (at least in the interim) and to allow W to part-fund a shared ownership property. This case also highlights the difficulties that both courts and practitioners face at present with competing evidence on the parties’ borrowing capacity.  AXA v BYB (QLR: Financial Remedies) [2023] EWFC 251 (B)  <a href="https://caselaw.nationalarchives.gov.uk/ewfc/b/2023/251">https://caselaw.nationalarchives.gov.uk/ewfc/b/2023/251</a>  Recorder Rhys Taylor sitting at the Central Family Court, 18 December 2023  Core facts:  W aged 36 (lived in rented accommodation); H aged 41 (continued to live in the FMH- in his sole name)  5-year relationship with a child aged 3  Assets:  FMH net equity £100,000  London flat in W’s sole name net equity of £50,000 (W found to hold 50% beneficial interest)  Proceeds of Iranian property owned by H but sold in 2022 (value unknown)  W’s debts totalling £122,674 and H’s debts totalling £101,600  H’s pensions £86,983 and W’s pensions £28,844  Parties’ positions:  <ul> <li>W sought an order for sale and 100% of net proceeds to be paid to her or a Mesher order until child attained majority. She also sought periodical payments and her jewellery to be returned.</li>  <li>H sought to retain 75% of the net proceeds of the FMH, his pensions and clean break.</li> </ul>  Outcome:  <ul> <li>FMH (and contents) to be transferred to W subject to mortgage</li>  <li>Spousal maintenance at £700 pcm until child’s 18th birthday or completion of secondary education (global figure including CMS £1,360 pcm)</li>  <li>Cost order made by way of a pension sharing order, based on the limited amount of capital available against which W could enforce a costs order. This was expressed as follows in the order: “There is no order as to costs save that the court made a 100% pension sharing order over H’s Vanguard pension and has required H to pay promptly any costs of implementation in order to satisfy the costs liability.” (it later became apparent that the Vanguard pension was not illiquid, and the costs order was therefore amended to provide for 75% of the pension fund to be paid to W within 21 days).</li> </ul>  Useful takeaways from this case:  This is the first reported case that deals with the involvement of a Qualified Legal Representative. Recorder Taylor acknowledged the difficulties that this role entails, not least the fact that a QLR is not entitled to see the bundle in advance and cannot therefore make a judgment as to whether the case is within their competence. It is an extremely well-structured judgment with hyperlinks which enable the reader to jump straight to the relevant issue. The court held that W was entitled to a significant departure from equality on the basis of her needs. He quoted the recent judgment of Moor J in Butler v Butler [2023] EWHC 2453 (Fam) where he had stated that in a needs case the court does not necessarily need to make an order that meets both parties’ needs. The Recorder was unimpressed with H’s evidence and his lack of disclosure. He concluded that H would have to rent somewhere and commented at paragraph 148: “if this feels like rough justice, H only has himself to blame. He has the beneficial ownership of an undisclosed sum of money somewhere”.  JN v GN [2023] EWFC 244  <a href="https://www.bailii.org/ew/cases/EWFC/OJ/2023/244.html">https://www.bailii.org/ew/cases/EWFC/OJ/2023/244.html</a>  DJ Hatvany sitting at the FRC in Swindon, 21 November 2023  Core facts:  W aged 60 (continued to live in the FMH); H aged 62 (lived with partner in social housing with secured tenancy)  23-year marriage with one adult child  Assets:  FMH with equity of £224,500  H’s inheritance £468,000 + £30,000 for a painting (dissipated)  H was also alleged to have dissipated £28,000 endowment policy and £56,000 cashed-in pension  Modest pension provisions  Parties’ positions:  <ul> <li>W sought a transfer of the FMH into her name and H to clear the outstanding mortgage, as well as a cost order</li>  <li>H agreed that W should retain the FMH but did not agree to repay the mortgage</li> </ul>  Outcome:  <ul> <li>FMH transferred to W</li>  <li>W to retain responsibility to repay the mortgage</li>  <li>Departure from equality justified on the basis of H’s spending</li>  <li>Clean break</li>  <li>H to pay £10,000 towards W’s costs (£350 pcm due to lack of resources) due to litigation conduct</li> </ul>  Useful takeaways from this case:  District Judge Hatavny took a very pragmatic approach when confronted with a limited asset base and significant non-compliance as well as financial misconduct on H’s part. He ensured that W’s housing needs were met (taking into account her health issues) whilst acknowledging that it would be unfair to require H to repay the mortgage. The approach taken by the judge on costs is also worth of note and it is hoped that it can be replicated; in the vast majority of low-asset cases, there are usually no resources left to pay for a cost order (within 14 days or at all) and this appears to sometimes discourage courts from entertaining cost applications. However, a cost order in a low-value case can go a long way and this instalment-based approach is to be given serious consideration.  Ditchfield v Ditchfield [2023] EWHC 2303 (Fam)  <a href="https://www.bailii.org/ew/cases/EWHC/Fam/2023/2303.html">https://www.bailii.org/ew/cases/EWHC/Fam/2023/2303.html</a>  Peel J on appeal from a decision of Mr Recorder Samuels KC, 20 September 2023  Core facts:  W aged 55, H aged 49  15-year marriage with two minor children aged 17 and 13  Assets:  Property 1 £110,000 net equity  Property 2 £110,000 net equity  Rent in bank account £41,000  Combined business interests about £270,000 net  H’s pension £43,000  W’s debts £40,000  H’s debts £85,000  Outcome of the appeal:  <ul> <li>The judge at first instance had operated a departure from equality, 62/38 in W’s favour and made findings against H in respect of deficient disclosure, manipulative approach to litigation and deliberate downplaying of resources;</li>  <li>The appeal was dismissed on all 6 grounds;</li>  <li>Two amendments were made to the substantive order, namely that a provision giving a specified timeframe for H to repay his sister a soft loan was deleted, and a s 28(1A) provision was added.</li> </ul>  Useful takeaways from this case:  This case highlights the difficulties that parties face when appealing findings of fact. The judge at first instance had been satisfied that, even if H’s share was less readily realisable, it was nonetheless sustainable, and he had only himself to blame for the judge’s adverse findings.  Of particular interest is Peel J’s rejection of H’s criticism of the first instance court’s treatment of the available resources with reference to the parties’ housing needs. Mr Recorder Samuels KC had found that H would need time to rebuild his resources so as to buy a property and, with his earning potential, he would be able to do so. Peel J commented at para 39: “although it is generally desirable in financial remedy cases for each party to be able to own a property, with the attendant benefits of security and potential investment upside, it is not an iron rule. It will all depend on the facts. In this case it is not possible to do so at this stage.”  Butler v Butler [2023] EWHC 2453 (Fam)  <a href="https://www.bailii.org/ew/cases/EWHC/Fam/2023/2453.html">https://www.bailii.org/ew/cases/EWHC/Fam/2023/2453.html</a>  Moor J on appeal from a decision of Recorder Anderson, 24 August 2023  Core facts:  W aged 53 (lived in rental accommodation), H aged 64 (lived in owned property)  Six-year relationship, one child aged 16  Assets:  Property purchased by H £410,000 equity  Land in Jamaica owned by W £16,000  H’s small pension in payment  Both parties had debts  Outcome of the appeal:  <ul> <li>Recorder Anderson had ordered H to pay a lump sum of £58,000 to W and a clean break.</li>  <li>The appeal was a dismissed on the basis that the Recorder was entitled to make the order that he did; the lump sum ordered would enable W to clear her debts and there were no circumstances in which W would be able to purchase her own property.</li> </ul>  Useful takeaways from this case:  The unusual feature of this case is that the parties’ marriage had been in name only from 2009, despite the divorce petition being dated March 2020. Therefore, the property where H was residing was non-matrimonial, having been acquired post-separation. The appeal court did not interfere with the decision of the Recorder, accepting that he was entitled to reject an outcome which would have rendered H homeless. Moor J’s comment at para 39 will no doubt feature in many position statements and skeleton arguments moving forward: “The fact that a judge rightly concludes that a case is a "needs" case does not mean that the judge must then make an order that satisfies both parties' needs. In one sense, this is obvious, because there may simply be insufficient assets to satisfy the needs of either party, let alone both.” Moor J goes on to say that “the court cannot simply apply needs as the only consideration”, and it must in fact consider all factors under s25 MCA. Moor J found that the Recorder was entitled to reject making an order that would make H homeless, particularly in light of the non-matrimonial nature of the main asset.  As a side note, Moor J’s initial comments on the litigation costs, congratulating the lawyers for “the sensible and economic way in which the matter has been litigated”, make a welcome change from the stark criticism made by the higher courts on the disproportionate nature of the litigation costs incurred.  Conclusion  It is hoped that the extension of the transparency pilot to financial remedy cases will lead to more widespread reporting of low-modest asset cases. These are certainly the cases that lead legal representatives to scratch their heads, not to mention the pressure on mounting legal costs when the parties can barely afford it.

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The new Express Financial Remedy pilot

Roundup of recently reported modest asset cases

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North Eastern Circuit Women’s Forum Event in Newcastle – Women at the Bar and the Bench

Lydia Reed – Pupillage: Looking back on my First-Six at Parklane Plowden

The new Express Financial Remedy pilot

Avoidable Baby Death: Leila Benyounes Represents the Family at Inquest