G v G (arbitration)
| Jurisdiction | England & Wales |
| Judge | PEEL J |
| Judgment Date | 07 December 2022 |
| Court | Family Court |
Arbitration – Children arrangements – Whether Haley test applied to children arbitrations – Court’s jurisdiction – Procedure when challenging arbitration determination – Procedure when challenging triage/paper determination by court.
Children arrangements – Arbitration – Whether Haley test applied to children arbitrations – Court’s jurisdiction – Procedure when challenging arbitration determination – Procedure when challenging triage/paper determination by court.
The parents and their two children were both living in the same property in the west of England. The children attended a local school. There were ongoing financial remedy proceedings.
In March 2022, the mother sought the court’s permission to relocate with the children to the London area and also applied for a defined child arrangements order. The parents agreed to attend arbitration and accordingly the court proceedings were stayed. The arbitration was conducted in late July and included evidence from both parents and from an independent social worker. In August, the arbitrator refused the relocation application and provided for an equal shared care arrangement.
The matter was listed on 5 September 2022 before local justices, so that the arbitration determination could be incorporated in a court order. However, during the hearing, the mother’s counsel indicated that the mother intended to apply to set aside the determination. The lay bench recorded the parents’ agreement that ‘this matter shall be listed before a circuit judge for directions on the application following the guidance of Mr Justice Mostyn in A v A [2021] EWHC 1889’ and allocated the case to circuit judge level. The stay on the mother’s C100 application was lifted. On 8 September 2022, the mother formally applied in Form C2 for an order setting aside the arbitration determination and for a rehearing. The father opposed her application.
On 26 September 2022, the circuit judge allocated the matter to High Court level, noting that there was no direct authority on the legal test and/or procedure to be applied when a challenge was brought against an arbitration determination relating to a children’s dispute. Directions were made for a specific hearing to address the issues of (i) the applicable legal test and (ii) the applicable procedure where there was an application to set aside, or challenge, an arbitral determination in children’s proceedings.
Held, making directions—
(1) Applying Haley v Haley[2020] EWCA Civ 1369, the approach to be taken by the court on a challenge to an arbitral award in financial remedies, howsoever the challenge was made, was the appellate test ie whether the determination was ‘wrong’ or ‘unjust because of a serious procedural or other irregularity …’. (Family Procedure Rules 2010, r 30.12(3)). The essence of the ratio in Haley was that a financial remedies order derived its authority from the court, which had a discretion whether, and if so in what terms, to make the order. The order was made pursuant to the Matrimonial Causes Act 1973, not the Arbitration Act 1996, and the arbitration award was not enforceable until such time as an order in like terms was made. The court was entitled to refuse to convert an award into an order if it considered that the arbitration award was wrong. Where a party challenged the award, the court should conduct a triage exercise on paper. The test at this filter stage was the same as on an application for permission to appeal, namely whether ‘the court considers that the appeal would have a real prospect of success’ or ‘there is some other compelling reason why the appeal should be heard’ (Family Procedure Rules 2010, r 30.3(7)). If the court was satisfied that the hurdle was passed, then it should list the application for a full inter partes hearing of the challenge, akin to a hearing of an appeal against a court order, which operated by way of a review of the lower court’s decision (Family Procedure Rules 2010, r 30.12(1)). If it was not so satisfied, then the court could ‘make an order in the terms of the arbitral award without more ado’, quoting Haley (see [1]–[3], [13], below).
(2) The more recent decision in A v A[2021] EWHC 1889 (Fam) had given guidance, with the President’s approval, as to the appropriate procedure to be followed when there was a challenge to an arbitral award. In summary: (i) The challenge to an award should be made by issue of Form D11; (ii) The party challenging the award should submit a skeleton argument not exceeding 20 pages and the party seeking to uphold the award ‘may file a short skeleton in response’; and (iii) The papers should be placed before a circuit judge to conduct a ‘triage/paper’ exercise and to decide whether the permission to appeal test had been passed. If so, direction would be given for an inter partes hearing. If not, an order would be drawn in the terms of the arbitration award (see [4], below).
(3) This hearing had emphatically not been a hearing on the merits of the challenge. It had been designed to give a clear legal and procedural foundation for the progression of the challenge. The court made no comment about the merits of the case. The issue was whether the Haley test applied to a challenge to an arbitration determination made in a dispute about children, as it did in a challenge to an arbitration award made in a financial remedies dispute, and, if so, whether the A v A guidance applied, save as necessarily adapted for children’s cases (see [5], [12], below).
(4) The same principles applied to a children’s dispute determined by arbitration as to a financial remedy case determined by arbitration. A judge being invited to make any welfare order under the Children Act 1989 must be independently satisfied that it was a proper order to make, the paramount consideration being the welfare of the child. Upon making an order after a contested hearing, or when endorsing an order made by consent, the judge had a duty to have in mind the welfare checklist and to ensure that the order was compatible with the paramountcy principle. This also applied to the making of any order which one party (if the determination was challenged by the other party) or both parties (if there was no challenge by either party) invited the court to make after an arbitration determination. If there was no challenge to the determination, it was highly likely (albeit not inevitable) that the court would make the order sought. But the parties could not oust the jurisdiction of the court and, whether the order sought was agreed or opposed by one or other party after the arbitration determination, the court’s overarching duty to consider whether the order was consistent with the best interests of the children remained the same. The mere fact that the parties had submitted to an arbitration did not prevent the court from scrutinising the subsequent order and, if appropriate, refusing to endorse some or all of its provisions. Accordingly, as with a financial remedies arbitration award, the test to apply was whether the children’s arbitration determination was ‘wrong’, nothing more and nothing less. It seemed to the court that comments in Haley itself envisaged the same principles on challenge to family cases generally, not just financial remedies cases (see [14]–[16], below).
(5) Further, in submitting to the Family Law Arbitration Scheme, the parties in this case (as, the court assumed, in every case where the parties entered into the children’s arbitration scheme) had signed the ARB1-CS form. Sub-paragraphs 8.49 (b) and (c) of the form (which replicated r 13.3 of the Family Law Arbitration Children Scheme Arbitration Rules 2021) expressly envisaged that that the court might depart from the arbitration determination as it thought fit, including, at sub-para (c), in the exercise of its jurisdiction under the Children Act 1989. In other words, parties to a children’s arbitration entered into the process explicitly accepting that the court, applying the foundational principles of the Children Act 1989, might make an order which differed from the determination. The IFLA clearly considered that the rules, and ARB1-CS form, stated the law correctly, and were right to do so. The court retained its welfare jurisdiction in the manner explained in the ARB1-CS form (see [17], [18], below).
(6) It was obviously desirable to have, where possible and consistent with the interests of justice, coherent and coordinate principles applicable to challenges to arbitration awards and determinations. In the court setting, the appellate test was the same for financial and children’s cases, and in the court’s judgment, the same should apply when an arbitration award or determination was challenged. The court agreed with comments to this effect in the Family Court Practice 2022, and in two articles: ‘Family Arbitration: the outlook after Haley’ [2021] Fam Law 233 and ‘Arbitration after Haley – if not now, when?’ [2021] Fam Law 811. It was clearly intended that all challenges to an arbitration determination in the context of family law should be brought under one single umbrella, namely, whether the determination was wrong. It was hard to conceive of a situation where a challenge to an arbitration award in a financial case, or an arbitration determination in a children’s case, procedurally needed any more than one application. That application would, of course, contain in the supporting skeleton argument the grounds upon which the challenge was pursued. Those grounds could include the matters mentioned at s 68 and s 69 of the Arbitration Act 1996, but these should not be separate free-standing applications. The test would be the same, namely whether the award or determination was wrong; within that test, procedural irregularity or error of law might form part of the grounds of challenge. It would be curious if a different test were to apply as between financial remedy and children’s disputes when the issue before the court in each case was...
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