Hon Judith Collins

Minister of Justice

25 March 2014

Address to Arbitrators’ and Mediators’ Institute of New Zealand (AMINZ) Breakfast meeting on the new Family Disputes Resolution service

The Northern Club, Auckland

Ladies and gentlemen

Good morning.

Thank you for this – very timely – opportunity to speak to you this morning about the Government’s reforms of New Zealand’s family justice system. Yesterday the Governor-General signed an Order in Council, setting 31 March as the day the new system comes into effect. And later today the Ministry of Justice will launch a new Family Justice website, and begin a public awareness campaign.

These reforms mark the most significant changes to New Zealand’s family justice system since the establishment of the Family Court 33 years ago. They aim to create a modern, accessible and sustainable family justice system; one which responds to the needs of children and vulnerable people who most need the Court’s protection.

The aim is, wherever possible, to reduce the amount of stress experienced by families and children, by avoiding the delays, conflict and expense that court proceedings entail by greater use of out-of-court mediation.

These reforms are the result of an extensive review in 2011. The review involved input from Judges, Family Court lawyers, counsellors and psychologists and confirmed what everyone knew and had been unable to address: the system was not working well, and it had to change.

The system had to change because New Zealand has changed since Parliament passed the Family Courts Act in 1980. At a time when the traditional “nuclear” family was the norm, the Court’s primary motivation was to reconcile married couples. Today the reality is that children grow up in safe and caring families, whether they are living in one-parent and blended families, or if their parents are married or in de facto or same-sex relationships.

The 2011 review found that Family Court processes were complex, uncertain, and too slow. Too many people were going to court and the costs were increasing without corresponding benefits for children and families.

Our reforms, which go-live next week, put the needs of children and vulnerable people first. They make significant changes to the Care of Children Act, which accounts for about 40 percent of all applications to the Family Court.

Each year, more than 20,000 children are the subject of court disputes under the Care of Children Act.[1] The Family Court process – with its propensity for protracted litigation and delays – can take a very heavy toll on those children.

As I told Parliament last year, applications under the Care of Children Act are taking, on average, 238 days to resolve[2]. All too often, throughout that time, the children wait in a state of limbo. The longer uncertainty remains, the greater the stress and anxiety they experience. Adults exerting their right to ‘have their day in court’ too often do so at the expense of their children.

A key part of the reforms is recognition that the Family Court should be just one part of a wider system that helps families reach agreement about care arrangements for their children. These reforms will ensure that more cases are dealt with outside of court, so that the Family Court can focus on serious, urgent or legally complex cases.

Most people manage to sort out their relationship issues without resorting to legal action and these reforms are designed to encourage, and assist, more people to settle their disputes themselves. Central to this goal – of helping people to help themselves – is the introduction of out-of-court family dispute resolution.

The introduction of a new service – Family Dispute Resolution or FDR for short – is the most significant change within these reforms and I foresee it becoming a cornerstone of the family justice system.

Family dispute resolution will see trained and accredited mediators – like AMINZ members – working to help parties reach their own arrangements for how their children will be cared for. This happens outside the court, without lawyers or a judge.

FDR will be mandatory for most parents before they can access the Family Court to sort out parenting disputes. FDR will consider issues such as: who a child should live with when their parents have split up; who the child has contact with; choosing a school; or working out whether a child attends school holiday care. Urgent or serious cases, such as those involving domestic violence, will still go straight to the Family Court, without the need for FDR beforehand.

A range of specifically developed materials will be available to parties, both in hard copy and online to help parents develop parenting plans.
The key to these reforms is to encourage parties to reach their own agreement if at all possible. Agreements that are reached by the parties themselves have a much better chance of being honoured than court imposed decisions.

To further assist in reaching an agreement, parties will also need to attend the Parenting Through Separation training course which encourages parents to put the needs of children at the heart of their decision making.

The numbers likely to access Family Dispute Resolution are not large. The Ministry of Justice estimates about 7000 cases a year. Of those, it is further estimated that 60 percent of individuals accessing FDR will be fully Government funded. The Family Dispute Resolution market is not a big market and I don’t see it growing.

FDR only involves Care of Children Act cases, which make up 40 percent of the Family Court’s work. The other 60 percent of the Court’s work, for example resolving disputes about care and protection orders, domestic violence applications and complex relationship property, will continue to be dealt with directly by the Court as they always have been.

As I mentioned, most people resolve parenting and relationship disputes themselves without resorting to litigation. However, under changes to the Care of Children Act passed by Parliament last year, only those parents who have completed FDR and, who still cannot resolve their dispute, will be able to apply to the Family Court for parenting or guardianship orders.

These statutory requirements set FDR apart from other forms of alternative dispute resolution (ADR), which is usually undertaken through the mutual agreement of the parties. It is not about resolving a dispute between two businesses about the terms of a contract. Nor is it about who gets what in a division of relationship property.

FDR is about resolving disputes between parents about the care of their children – the future of our society. Most parents in dispute about the care of their children will have to participate in FDR before they can access the Family Court. I therefore believed it was essential the service would be both affordable and accessible to most New Zealanders.

For this reason I have settled on a system that gives parents in dispute, who are already under enough stress as it is, some certainty about the costs they might face. When the legislation was at select committee stage, I indicated that those accessing Government-subsidised FDR would not have to pay more, on a per case basis, than about $900 including GST. Since that time, we’ve settled on a figure of $897 including GST. For those who meet the income threshold for civil legal aid – estimated to be about 60 per cent of participants – FDR will be fully funded by the Government and access to this service is through Government-appointed suppliers.

In terms of the selection of suppliers to provide fully-funded FDR services, I am advised by the Ministry of Justice that they engaged in a thorough procurement exercise to identify suppliers who met the criteria. This involved firstly a Request for Information (RFI), and more recently, a Request for Proposal (RFP) exercise.

As a result of the RFI process, Fairway was identified as the only organisation able to provide FDR services nationwide from day one, and the Ministry has negotiated with Fairway to this effect. This was made clear in the RFP.

Following responses to this RFP exercise, the Ministry is negotiating with other potential suppliers with a view to them also being able to engage in the delivery of fully-funded FDR.

I also recognised that providing FDR would, in many instances, cost suppliers of non-fully funded FDR services more than $897 to deliver. While the market to provide FDR is in its formative stage, I am keen to see it evolve and mature. To that end, I am able to announce this morning that additional suppliers who meet terms set by the Ministry of Justice will receive a funding top-up to bring the effective income they receive from providing FDR services to the non-fully funded market to about $1,400 including GST. By FDR, I mean the assessment, the mediation and the administration that goes with this, is funded. Given many suppliers will offer other services to complement FDR I believe this will set a reasonable benchmark for the developing market.

The Ministry aims to have this offer in place by three months of commencement and will be providing more information in the coming weeks.

FDR providers will assume a key role as ‘gateway’ to New Zealand’s reformed family law system, and have a direct interface with our family justice system.

The Secretary for Justice has approved AMINZ as an approved dispute resolution organisation. AMINZ is one of only three organisations – alongside the Law Society and LEADR – that is responsible for appointing individuals as approved FDR providers. In that role, it is your responsibility to decide who is appropriately trained and skilled to provide these services.

FDR practitioners will generally have at least five years of practice in family mediation or an associated profession to be credentialed by AMINZ. This requirement sets the requisite high standard for FDR but I am confident we already have a number of talented individuals – many of them here this morning – poised to enter this new environment.

This new environment is a major innovation in the field of alternative dispute resolution in New Zealand. For those who have decided to become involved it has required some unsettling change. As you know from mediating parties in dispute, dealing with change is never easy. Change often involves challenges.

There are challenges in adopting new systems, meeting new contractual standards of customer service and in addressing new issues around parents and the care of their children.

But like all changes it also involves opportunities and I see many opportunities for mediators in FDR. ADR practitioners have long argued that mediation offers better outcomes in resolving disputes. It is a sentiment with which I have some sympathy.

In more than two decades as a lawyer I quickly came to the conclusion that litigation is not always the best way to solve a dispute. Decisions by judges and courts, however well framed, often create the impression of “winners” and “losers” and increase the odds that one party will breach any order. The most enduring arrangements are usually those which the parties agree upon themselves, often assisted by professional mediators.

FDR signals a step-change for mediators in New Zealand. No longer is ADR being treated as an optional add-on or a “nice-to-have” extra. From 31 March it will play a central, statutory and mandated role in New Zealand’s family justice system, helping parents resolve disputes about the care of their children. The FDR forms that mediators produce will be key documents in assisting Family Court judges in dealing with the disputes that come before them. This is an important responsibility and dictates high levels of professionalism – standards I’m sure you will be able to meet.

To that end, I’m pleased to learn that AMINZ is offering a number of educational modules for FDR practitioners. I want to congratulate you on this commendable initiative and urge any prospective practitioners in the audience today to utilise these opportunities and enrol in these courses, to up-skill and to best prepare for the introduction of FDR in New Zealand.

The Government wants to encourage and support families who want to resolve their disputes in a way that preserves and enhances the healthy aspects of their relationship. Dispute resolution promises to achieve this better than litigation, which often reduces direct communication and emphasises parties’ differences rather than their shared interests.

Family dispute resolution is focused on achieving a lasting outcome and giving people skills to resolve future problems.

Most importantly FDR prioritises the rights and welfare of children. Everyday experience and research indicates that children do best when separating parents co-operate with one another about their children’s care arrangements. Successful FDR encourages parents to be responsible for minimising the negative impact their conflict may have on their children. FDR also keeps children outside of court processes, avoiding what can be a damaging or negative experience.

And let us not forget, a reasonable proportion of family cases that currently go through the courts will be resolved at FDR– allowing those courts to focus on urgent cases and those which are most difficult to resolve.

In conclusion, FDR focuses on achieving lasting outcomes and gives people the skills to resolve their problems themselves. Both FDR and the expansion of the Parenting through Separation programme empower parents to resolve their disputes with the help and guidance of expert support and mediation services.

The family justice reforms, and the introduction of FDR in particular, are about changing the way New Zealanders think about family law and the role of mediators in that process. FDR marks a new era for ADR in New Zealand, playing a central role in family justice. I will be keenly watching the implementation of FDR and the long-term potential of mediation in our wider justice system.

More than 30 years after the Family Court was established, it is now the right time to move away from a court-centred approach to family disputes. If we can keep people out of court, if we can get them to take responsibility for their own actions – and put the welfare of their children to the forefront – we will have gone a long way to bringing family law into a new era.

In the end, however, the success of these reforms rests with those who work in our family justice system, including many of you here this morning. We all want to ensure this system works well, because, like you, we believe New Zealand’s families and children deserve nothing less.

Thank you.

Ends

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