In recent years, family arbitration has become an increasingly popular way of resolving disputes following separation or divorce. Many couples are drawn to it because it offers privacy, flexibility, and speed at a time when the family court is often under considerable pressure. Hearings can be listed quickly, the parties can choose their arbitrator, and the process is generally more informal than court litigation.

That said, arbitration is not a complete substitute for the family court. There remains important powers that only a judge can exercise, and there are particular circumstances in which court proceedings are not just preferable but necessary.

Why arbitration is often preferred

Arbitration in family law is most commonly used to determine financial disputes arising from divorce or disputes under the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA). It can also be used for certain child disputes, although this is less common. The process generally follows this route:

  • The parties agree to appoint a suitably qualified arbitrator, often a senior barrister, solicitor, or retired judge, who will determine the issues in dispute.
  • A timetable is agreed along with the scope of the issues and the format of the hearing.

The process is private and confidential; there is no waiting months for a court date, and no risk that the case will be adjourned at short notice because of judicial availability.

For many separating couples, particularly those who wish to preserve a working co-parenting relationship or who have sensitive financial or business considerations, this degree of control and discretion is appealing. Arbitration also tends to produce a final decision more quickly than the court system, which can reduce stress and legal costs.

However, despite these advantages, arbitration has structural limitations. These stem from the fact that an arbitrator derives their authority from the agreement of the parties, whereas a judge derives authority from statute and the inherent jurisdiction of the court.

Arbitrators and judges: Different roles, different powers

The distinction between arbitrator and judge goes to the heart of their powers. A family court judge can compel attendance, enforce compliance, and make orders binding on third parties. A judge’s decision carries the weight of the court’s enforcement machinery.

An arbitrator, by contrast, is appointed under a private agreement between the parties and operates under the framework of the Arbitration Act 1996 (as adapted for family law by the Institute of Family Law Arbitrators (IFLA) schemes). The arbitrator’s jurisdiction exists only because both parties have agreed to submit their dispute to arbitration. If one party refuses to engage at the outset, arbitration cannot proceed.

Although the family court has made clear that it will generally uphold and convert arbitration awards into court orders unless there is a compelling reason not to do so, the arbitrator does not have the same powers as a judge during the process itself.

Powers the family court has that arbitration does not

  • The power to compel disclosure from third parties: In financial remedy proceedings, full and frank disclosure is the cornerstone of the process. A judge can make orders requiring third parties, such as banks, employers, accountants, trustees, or business partners, to disclose documents or provide information. An arbitrator has no independent power to compel a non-party to provide disclosure. While parties can agree to seek disclosure voluntarily, if a third party refuses, the arbitrator cannot enforce compliance.
  • The power to join third parties: The court can join third parties to proceedings where their interests are engaged. This often arises in cases involving allegations that assets have been transferred to relatives or companies to defeat claims, or where there is a dispute about beneficial ownership of property. For instance, if one spouse claims that the former matrimonial home is owned by a company controlled by the other spouse’s parents, the court can join the company and the parents to the proceedings. Arbitration, by its nature, binds only those who have agreed to participate; an arbitrator cannot compel a third party to do so.
  • The power to grant injunctions: The family court can grant a range of injunctions, including freezing orders to prevent the dissipation of assets, non-molestation orders, occupation orders, and orders restraining the removal of children from the jurisdiction. An arbitrator does not have the power to grant injunctive relief in the same way. If there is a risk that assets may be dissipated, or that one party may seek to frustrate the process, an application to court is necessary. Similarly, issues of domestic abuse requiring protective injunctions must be dealt with by the court.
  • Enforcement powers: While an arbitration award can be converted into a court order, enforcement mechanisms ultimately depend on the court. The family court can make attachment of earnings orders, charging orders, third-party debt orders, and in extreme cases, commit a party to prison for contempt. An arbitrator cannot directly enforce compliance. If a party refuses to abide by the award, the successful party must return to court to have it embodied in an order and enforced. This additional step can be straightforward in cooperative cases but problematic in high-conflict ones.
  • Public law and safeguarding jurisdiction in children cases: In children matters, the court has a safeguarding function. It can direct Cafcass involvement, order section 7 or section 37 reports under the Children Act 1989, and make findings of fact regarding allegations of harm. It can also involve local authorities and make public law orders if necessary. Although child arbitration exists, it is generally confined to private law disputes between parents. Where there are serious safeguarding concerns, allegations of abuse, or the potential involvement of social services, the court’s broader protective jurisdiction makes it the appropriate forum.
  • The power to make certain pension and property orders: While arbitrators can determine the division of pensions and property in principle, certain orders, such as pension sharing orders, must ultimately be made by the court to take effect. An arbitration award cannot itself implement a pension share; it must be converted into a court order approved by a judge.

When court may be the better route

There are obvious scenarios in which issuing court proceedings is either unavoidable or tactically wiser.

  • Non-cooperation from the outset: Arbitration depends on agreement; if one party refuses to engage, the court is the only route.
  • Complex asset structures: Cases involving trusts, offshore entities, or disputed beneficial ownership may require third-party joinder and coercive disclosure.
  • Risk of asset dissipation: Urgent freezing relief is only available through the court.
  • Domestic abuse or safeguarding concerns: Here, the court’s protective powers are essential.

Where parties are broadly cooperative but disagree on valuation or the appropriate division of assets, arbitration can be highly effective.

Is it possible to use both routes?

Hybrid approaches are not uncommon. One example is where parties arbitrate the financial issues but require the court’s assistance for another matter, such as joining a third party or granting interim relief. Another is where an award is converted into a consent order and approved by the court, which is standard practice in financial remedy cases following divorce.

There are also situations in which arbitration may break down, perhaps because new evidence emerges requiring third-party involvement, leading the parties back to court. Alternatively, parties may begin in court but later agree to adjourn proceedings and refer specific issues to arbitration to speed up resolution.