The Court of Appeal decision in Haley v Haley [2020] EWCA Civ 1369 represents a significant shift in how challenges to financial remedy arbitration awards, under the Matrimonial Causes Act 1973 (“MCA 1973”) or the Civil Partnership Act 2004, are handled. This ruling signals a move towards treating these arbitration awards more like traditional court judgments, particularly in terms of the avenues available for appeal.
Arbitration Gains Ground in Family Law
Arbitration has been gaining traction in family law due to its advantages over court litigation—namely, greater control over the proceedings, speed, choice of the tribunal, and privacy. The case of Mr. and Mrs. Haley exemplifies the practical benefits of arbitration; when their final hearing was cancelled due to a lack of judicial availability, they opted for arbitration, which proceeded on the initially scheduled trial dates.
Core Issues and the Court of Appeal’s Decision
Mr. Haley challenged the arbitration award under Sections 68 (serious irregularity) and 69 (appeal on a point of law) of the Arbitration Act 1996 but lost at the initial trial before Deputy High Court Judge Clare Ambrose (cited as R v K [2020] EWHC 841 (Fam)). However, the Court of Appeal’s decision changed the landscape by determining that the general test for appealing judgments of a first instance court should apply in financial remedy arbitration cases, rather than the more limited grounds specified under the Arbitration Act 1996.
Legal Implications and Broader Impact
This decision potentially makes it easier to challenge financial remedy arbitral awards in the courts. For those valuing privacy, like celebrities, this might be unwelcome. However, it could be beneficial for those who previously shied away from arbitration due to fears of an incontestable unfair outcome. The decision could also influence how disputes related to the Trusts of Land and Appointment of Trustees Act 1996 (“TOLATA”) and the Inheritance (Provision for Family and Dependants) Act 1975 (“1975 Act”), along with Schedule 1 of the Children Act 1989, are arbitrated and challenged.
The ruling importantly interprets the application of the MCA 1973 alongside key provisions of the Arbitration Act 1996. The appellate approach now mirrors the flexibility of section 68 and 69 challenges, initially reserved for arbitral proceedings, expanding them to the broader, more commonly understood standards of appeal within family law disputes.
Conclusion
The Haley v Haley decision marks a pivotal development in arbitration within family law, providing greater parity between the arbitration process and traditional court litigation. This could lead to increased confidence in arbitration as a dispute resolution mechanism, balanced by the reassurance that unjust awards can still be effectively challenged. As legal practitioners and stakeholders adapt to these changes, the impact of this decision will likely be discussed and debated in legal circles and beyond, influencing future arbitration and litigation strategies.