On average, 22% of the cases in the NSW Supreme Court are referred to Court-Ordered Mediation. Of these, approximately 42% of the cases settle at Mediation. Mediation is an important part of the Family Provision Regime, enabling Family Provision Claims to be resolved in a cost-effective and efficient manner.

Court Ordered Mediation

In NSW, under the Succession Act and pursuant to Practice Note SC Eq 7 – Family Provision, unless the court orders otherwise, all family provision claims must participate in Court-Ordered Mediation before the matter can proceed to a final hearing and be determined by a Judge.

What is Mediation?

Mediation is an alternative dispute resolution process whereby an independent, impartial and neutral third party, the mediator, assists the parties’ negotiations and helps facilitate settlement of the issues. A mediator, however, is not a judge and does not have the power to impose binding decisions.

The Mediator

In family provision, a Supreme Court’s equity division registrar may act as the mediator, or the parties may employ a private mediator.

Benefits of Mediation

  • Mediation is cost-effective and quicker than court.
  • It is less adversarial and thus promotes better relations between the parties.
  • Parties have greater flexibility in reaching decisions and are not strictly bound by legal rules, rights or norms.
  • Everything said and done at mediation is confidential.
  • Unlike a final judgment, if the matter is settled in mediation, it cannot be appealed.

Preparing for the Mediation

Representation

All relevant parties should be represented at the mediation, preferably by a legal professional. Generally, the executor will represent the interests of the beneficiaries. However, a beneficiary may wish to engage separate legal representation, particularly where the interests of the executor and beneficiaries are, or may be, in conflict.

Legal Advice

All parties to the mediation should consult with their legal practitioners to attain advice on the case prospects and likely outcomes should the matter fail to settle at mediation, the potential costs of taking the matter to a hearing and the range of acceptable outcomes at mediation. Parties should be made aware of the legal principles governing family provision claims to ensure that they approach the mediation with a realistic understanding of the strengths and weaknesses of their case.

Preparation of Evidence

Prior to the mediation, an updated evaluation of the estate setting out all the assets and liabilities of the estate should be prepared. In this, regard should be had to any CGT and/or other tax implications concerning the estate and any distributions from the estate. All of this material, and all the evidence previously filed, should be provided to the mediator.

Settlement

If the mediation is successful and the parties have reached an agreement or settlement, that agreement will usually be expressed in draft consent orders. These consent orders must contain the provisions set out in the Practice Note at paragraph 20.

Where the orders do not require judicial approval, the registrar may make the consent orders, and the agreement will be enforceable by the courts. Note that under the Succession Act, if the orders include a release for any possible future claims, the court must approve the orders.

If the mediation is unsuccessful, the matter will return to court in order to fix a hearing date and set down a timetable for the filing of additional evidence.

DISCLAIMER: The information provided above is published for general informational purposes only and is not intended to be nor should it be relied upon as a substitute for legal or other advice.