A guide to family law arbitration

Going to court is not the only way that property matters can be settled by separated couples. 

The Family Law Act provides for a process of arbitration, which while similar to a court, is a private, formal dispute resolution process.

To have a property matter resolved by way of arbitration, parties agree on the appointment of an arbitrator and proceed to arbitration.  If they are already in the court system, parties obtain a court order referring their matter to arbitration. 

Who is an arbitrator?

The arbitrator is not a Judge.  An arbitrator is an experienced senior legal professional.  They must be an accredited family law specialist or have practiced for at least five years in the area of family law.

They must be trained, hold a qualification in arbitration and be accredited with the Australian Institute of Family Law Arbitrators and Mediators (AIFLAM) in order to conduct arbitrations.

What types of matters can arbitration be used for?

Arbitration can only be used for certain aspects of family law.

 Arbitration cannot be used for any type of parenting matter. 

It can however be used to settle a wide range of other family law matters such as property settlement disputes between married or de facto couples, spousal maintenance claims, disputes about Financial Agreements, decide whether there has been a de facto relationship and splitting superannuation. 

The arbitration process

During arbitration, parties present evidence and arguments to an arbitrator who then has the authority to decide the outcome of the case.  The arbitrator weighs the evidence presented in the same way that a court does, applying the principles contained in the Family Law Act.   The arbitration process is less formal than that applied in a court. 

The arbitration process is conducted according to the principles of natural justice. Natural justice, also known as procedural fairness, mean that the process must include:

1. An opportunity for both parties to present their case about the issues;
2. There must not be any bias in the decisions made; and
3. The decisions must be based on the facts and law.

Simple cases may be decided on the basis of written submissions and evidence to the arbitrator, without a hearing being necessary.  More complex cases may require various applications and responses, evidence being tested by both parties and cross examination, in much the same way that a court operates.

After weighing the evidence and parties’ submissions, the arbitrator will make a decision, called an “award”.  This is different to a court in that the decision made there is formalised by an order.  Awards have the same effect as an order even though they are not issued by a court.

Awards can also be appealed in the same way that court orders are.  If a party believes that there is an error in an award made, the appeal is made to the Family Court. 

An award can be appealed if:

1. There was an error in applying the law;
2. It was obtained by fraud (including non disclosure);
3. It is unenforceable;
4. It is impracticable to be carried out; or
5. It was affected by bias or lack of procedural fairness.

Once an award has been made, a party can apply to the courts to have the award registered, although this is not always necessary.  After registration, the award has the same effect as an order or decree of the Court and is enforceable as such.

Why choose arbitration?

There are a number of benefits in choosing arbitration over going to court. 

The benefits of arbitration are:

1. Being able to choose the arbitrator – The parties select the arbitrator.  Parties cannot select their Judge;
2. Time saving – Arbitration is a much quicker process than a court hearing. The average time from appointing an arbitrator to an award being made is 4 months.  In the court system, matters may take 12 months (and usually longer) to finalise;
3. Privacy – The arbitral award is not publicly accessible or published.  Court hearings are conducted in open court and decisions may be published (but with names changed to protect privacy);
4. Convenience – Arbitration occurs at a time and place convenient to all.  In court, Judges set the dates for matters to be heard;
5. Flexibility – The parties are able to run their arbitration however they like.   In court, the matter proceeds in accordance with strict rules that must be followed by both parties;
6. Finality – An award is final and is only subject to review/appeal with respect to errors of law or as outlined above;
7. Cost effective – The parties pay for the cost of the arbitrator equally in most cases.  This cost however is usually far less than the cost of preparing for and attending a court hearing.

Disadvantages of arbitration

1. It only deals with financial matters – parenting matters cannot be decided; and

• Whilst arbitration is much cheaper than going to court, this process is more expensive than conducting a mediation.

Who should use arbitration?

Arbitration is not suitable for every family law property matter.  It is unsuitable to property matters which are very complicated, for example, those involving trusts or companies. 

It is also unsuitable where there is a high level of dispute between the parties particularly about the evidence and facts of their case, or where parties will not comply with their obligations to provide disclosure.  In those circumstances a court would be a more appropriate forum to settle the issue. 

However, if the matter is relatively straightforward, and there is broad agreement on the key facts, then parties can save considerable time and cost by having their matter decided by an arbitrator.

Contact us to learn more

At ReesLaw we are experienced in the area of arbitration. 

We are able to prepare your matter for arbitration and represent you during the arbitration process. 

Should you wish to learn more about arbitration and whether it is suitable for you, please call:

07 4632 8484 to make an appointment or contact us online.