While the Family Division routinely uses the Financial Dispute Resolution (FDR) model to achieve swift, cost-effective settlements, its Chancery equivalent remains a valuable, yet significantly underused, resource.

As the costs and delays associated with full trials in the Business and Property Courts continue to rise, now is the time for solicitors and litigants alike to embrace Chancery FDR as a primary mechanism for resolving financial disputes within the jurisdiction.

What is a Chancery FDR and how does it differ?

The FDR model is an out-of-court process – usually taking the form of a Private FDR – where parties appoint an independent, specialist neutral (typically a leading barrister, solicitor, or retired judge) to give a confidential, “without prejudice” indication of the likely outcome at a final trial.

Crucially, the neutral in a Private FDR cannot be the trial judge. This ensures all parties can negotiate freely and candidly, putting their “cards on the table” without fear of prejudicing their position should the matter proceed to a final hearing.

While the concept originates in family law, its application in the Chancery Division, governed by the Civil Procedure Rules (CPR), is tailored for the issues specific to wills, trusts, and estates:

The case for wider adoption

The main reason Chancery FDRs are underutilised is historical: the concept is less embedded in the professional consciousness of practitioners compared to the family courts. However, the advantages are compelling.

1. High settlement rates and costs savings

The Family Division consistently reports settlement rates exceeding 85% at or shortly after an FDR.

While the neutral’s indication is non-binding, it injects much-needed objectivity and commercial reality into emotionally charged disputes.

For clients, the ability to avoid a five-to-seven-day trial – with preparation costs often running into six figures – is an overwhelming benefit. Even factoring in the cost of hiring a private neutral, the overall saving in legal fees, court time, and emotional energy makes FDR highly desirable.

2. Specialist expertise and judicial availability

Court-listed hearings, whether in the High Court or the County Court, are subject to significant judicial and listing pressures. This often leads to delays and the risk of being listed before a judge who lacks deep specialism in a niche area like trust construction or undue influence.

By opting for a Private Chancery FDR, parties regain control: they can select a highly experienced practitioner (e.g. a King’s Counsel or a specialist former judge) with demonstrable expertise in the precise area of dispute. This guarantees that the without-prejudice indication is grounded in the most current legal authority, adding significant weight to the subsequent negotiation.

3. Suitable for complex or inter-generational claims

Will, Trust, and Estate (WTE) claims are often characterised by long-standing family history, allegations of fraud or misconduct, and disputes where future relationships are essential. The private nature of FDR, held in chambers or a solicitor’s office rather than a public courtroom, provides an atmosphere far more conducive to resolution and preservation of familial relationships.

Where Chancery FDRs have maximum relevance

Certain types of WTE disputes are particularly well-suited to the FDR approach:

1. Inheritance (Provision for Family and Dependants) Act 1975 Claims (1975 Act)

These claims are inherently suited to FDR. The court is tasked with deciding the extent of “reasonable financial provision” a claimant should receive from an estate. This decision involves judicial discretion, making it difficult to predict with certainty.

A Chancery FDR neutral can assess all factors – the size of the estate, the claimant’s needs, the beneficiaries’ needs, and the testator’s reasons – and provide a range of likely outcomes, allowing parties to negotiate a precise figure immediately. This approach bypasses the need for costly expert reports and cross-examination on needs.

2. Proprietary estoppel and constructive trust claims

Where a dispute concerns whether a claimant has a beneficial interest in land based on promises made (proprietary estoppel) or contributions made (constructive trust), the court must determine two key elements:

Whether the claim is successful (i.e. whether the promise or contribution is established).
If successful, what the appropriate remedy should be (e.g. outright transfer of property, a cash sum, or a life interest).
The FDR neutral can objectively assess the strength of the evidence and value and nature of the remedy the court is likely to grant.

3. Trust administration and removal of trustees

Disputes often arise regarding the conduct of trustees, allegations of breach of trust, or applications for an account. If the parties are fighting over the distribution of specific assets or the amount that should be restored to the trust fund, an FDR is invaluable. A specialist neutral can quickly assess the extent of the breach (if any) and place a commercial value on the resulting liability, encouraging the parties to agree on a compensation figure or a mechanism for a clean-break resignation of the trustee.

Conclusion: time to make FDR standard practice

The Chancery Division has formally acknowledged the effectiveness of the FDR model, yet its uptake outside the family sphere remains disappointing.

In complex, high-value disputes concerning wills, trusts, and land, FDR offers a mechanism for achieving finality, certainty, and profound cost savings.

As senior associates in contentious private client work, we have an obligation to guide our clients towards the most efficient resolution possible. Private Chancery FDR provides the framework to leverage specialist expertise in a collaborative, confidential environment, turning the heat down on emotionally charged disputes and bringing them to an effective conclusion.

Considering a Chancery FDR?

At TWM Solicitors, our Will, Trust and Estate Disputes team regularly advises clients and professional executors on the suitability and strategy of FDRs in complex estate and trust matters.

To discuss whether a Chancery FDR may help resolve your dispute effectively, please contact a member of our specialist team.