Arbitration is Coming to the Front Allowing People to Opt Out of the Court System Because of Court Delays

02/06/2021

There have been many changes in recent years to the family law system in Australia and the Family Court of Australia and Federal Circuit Court of Australia are being merged.  Despite the changes and innovations, the reality is that there are significant and unacceptable delays between the time of commencement of proceedings and the Final Hearing before a Judge.  The delay is now in most cases over 3 years. 

Waiting for years to finalise a property case is not realistic for most people.  More and more people are opting out of the Court system and resolving their case through Arbitration. 

When can Arbitration be used?

For some time the Arbitration process has been an option available to resolve family law property disputes.  During the Covid-19 Pandemic, the National Arbitration List was introduced to the Family Court of Australia and the Federal Circuit Court of Australia.  In each Court there is a dedicated Judge dealing with family law matters facilitating and referral to Arbitration.  For many years Lawyers tended to discourage clients from participating in the Arbitration option fearing that the appeal rights would be compromised.

What is an Arbitration? 

An Arbitration involves a private hearing where an Arbitrator (a qualified Lawyer) appointed by the parties carries out the functions that a Judge would in the determination of the case.  The process is private and unlike decisions of the Family Court and Federal Circuit Court, the decisions are not published. 

Proceedings already in the Court system can also be sent to Arbitration.   Parties who have not instituted proceedings in the Courts can resolve their matters by participating in an Arbitration. 

How does Arbitration work?

The case will proceed substantially in the same way that the case would proceed before a Judge.  The parties would prepare their evidence in advance and attend the Arbitration and present their arguments for their case and against the case of the other party.  The Arbitrator would decide the outcome and make orders and provide reasons for why the orders had been made. 

Is an Arbitration Award Final and Enforceable?

Together the orders and reasons are an Arbitration Award.  Once the award has been issued the award can be registered in the Court. 

Grounds for Objection to Registration of Awards

The grounds for setting aside or reviewing an Arbitration Award are limited.  The limited circumstances are:

• Errors of law. 
• Fraud. 
• Void, voidable or unenforceable. 
• Impracticality. 
• Bias or lack of procedural fairness. 
• Arbitrator not a proper Arbitrator in accordance with the Act. 
• Lack of Notice of Application to register the Award. 
• Breach of Arbitrators duty. 
• Lack of capacity in a party to take part in Arbitration. 
• Lack of application of laws of evidence, failure to give reasons or adequate reasons. 

When is Arbitration not Suitable?

The Arbitration system applies to financial cases only and parenting matters are not suitable for Arbitration. 

Benefits of Arbitration

• The parties can control the timing of the process. 
• The process is confidential.  
• The costs are comparatively lower than proceeding through Family Court of Australia or Federal Circuit Court.
• The Arbitration Award (when Registered) becomes an Order of the Court and is enforceable as an Order of the Court. 

If you are in the process of entering into financial/property settlement with your spouse or de facto partner or have commenced Court proceedings relating to financial/property settlement, you now have a cost effective alternative course; “Arbitration” which you may wish to take.  Our experienced Family Lawyers can provide advice and assist you with the Arbitration process to achieve an equitable resolution.  Please contact Richard Watson Senior Family Law Solicitor or his Personal Assistant Shereen Da Gloria to discuss your matter and seek appropriate advice.

This is only a preliminary view and is not to be taken as legal advice without first contacting Watson & Watson Solicitors on 9221 6011.