Mediation: a fairer fix on future finances

With inflation running higher than ever and weak wage increases, many people ordered to pay maintenance upon divorce are unable to keep up such payments.

Some just stop paying and wrack up arrears. Others eat into capital or discharge on credit cards or borrowings as a short term coping mechanism.

Those receiving maintenance may also have realised that what was agreed and or ordered, does not cover their monthly needs.

There lies the challenge of having to revisit the financial territory post divorce with few wishing to return to square one and repeat the process they embarked upon first time around.

Mediation (and other dispute resolution options including arbitration) can address a number of the barriers to reopening maintenance orders.

Communication with an ex-spouse, is supported in mediation, as the mediator does not represent either party nor positions parties against each other. Taking an independent role, they facilitate an outcome that works for both payer/payee.

Before the mediation is concluded or documented, it is reality tested against different scenarios (“what if I need more later; what if I lose my job/my wage increase is below inflation?”). Mediations end with a memorandum of information which can be converted into a new court order.

Information

– a mediator is unable to advise either payer or payee but can explain what the law says on the issue and review what likely outcomes might look like if the matter was taken to court.

What many may not appreciate is that by raising the idea of varying any maintenance order, there is a possibility that one or other may seek the stopping of maintenance and, if so, upon what terms, which may include capitalisation of the maintenance quantum. The mediator explains how a court would deal with such a scenario and whether the recipient could “adjust without due hardship”.

Timing

- Courts are no longer the obvious choice for sorting such issues because of the time it can take from identifying that one or other party wants to vary the maintenance, through to resolving matters by agreement or a full hearing with a judge making a new order. This can take at least 6 months if not a year.

Mediation and arbitration offer faster outcomes because they are more flexible processes, but to start either both need payer and payee to agree to the process.

Reduced paperwork

– mediation is no soft option. It is still necessary to complete some financial disclosure. Mediation still involves some financial disclosure to understand if a reduction is justified (and if not how to deal with arrears) ; if an increase is warranted ( income streams and budgets will be looked at) .The scope of that disclosure though is up to the mediator and the parties to decide. A minimum might be what a court accepts if there is a consensual deal.

Access to solutions

– whilst the availability of funding for legal advice is extremely limited, it is not difficult to find family/lawyer mediators countrywide at a variety of price points, who have the legal and financial skill set, to convene a few mediation sessions.

Autonomy and privacy

– parties want to sort things out themselves but without the scrutiny of any third parties. Final court hearings may mean in public to meet the courts desire for greater transparency. That often is at odds with the desire to keep family disagreements about money, a private affair. Mediation can bolster both parties’ sense of autonomy. The taking of responsibility for outcomes often adds to the chances that those outcomes will be abided by rather than handing matters over to a judge to decide or an arbitrator imposing an award.

Relooking at maintenance is sometimes necessary - mediation might just be the right route to take for a fairer fix on future finances.