Arbitration in Family Law: Quicker and More Cost Effective than Litigation

Posted by Daniela Poletti on 26 January 2016

Arbitration is a form of dispute resolution where parties (or their lawyers) will present arguments to a chosen independent arbitrator who will make a determination to resolve the dispute.  

The use of arbitration is almost like a 'combination' of court proceedings and mediation. It is similar to mediation in that it is an out of court settlement method, however it differs in that the parties work to reach their own agreement. The advantages of choosing arbitration include the fact that it is more flexible than going to court, and it is also usually a lot quicker and less expensive than the court process.

Arbitration can be especially appealing to separating couples who have disputes about both children and financial matters.  For these parties, they can address their parenting issues through mandatory family dispute resolution and then arbitrate their financial dispute afterwards without any delay in waiting for the courts.

Up until now, the use of arbitration in family law has not been widespread.  Parties and their lawyers have tended to use either mediation and dispute resolution (where the parties ultimately resolve their own dispute and reach an agreement), or refer the matter to the Court system for resolution. However, the Family Court of Australia has recently introduced new rules under the Family Law Act to govern the use of arbitration in financial matters and ensure the process is conducted professionally and effectively.  The rules will commence operation on 1st April 2016 and will apply to property settlement matters where parties opt to use arbitration as a dispute resolution process instead of court proceedings.

By using arbitration, family lawyers can agree to have their clients’ matters determined in a final way by a qualified arbitrator who will hand down a binding decision on the parties which will then become an order of the court.  Most importantly, the arbitrators used in Family Law matters are trained and accredited by the Australian Institute of Family Law Arbitrators and Mediators so they are familiar with the issues involved in family law matters and qualified to make any necessary decisions.

The new rules will hopefully encourage more parties to look at arbitration as a means of resolving their financial matters and, as a result, reduce the number of matters being referred to the Court. 

For more information on the use of mediation or arbitration in family law, contact Daniela Poletti on ph 02 9899 9677 or email .