Mediation and Out-of-Court Settlement
Within Australia’s family law system, the great majority of disputes about divorce, parenting arrangements and property settlement are not ultimately resolved by a court decision.
They are settled, before a matter reaches court, through mediation or out-of-court settlement.
This negotiation-first approach reflects the law’s respect for parties’ autonomy to decide their own arrangements, and is also driven by practical considerations of cost, time, and the preservation of ongoing relationships.
Under section 60I of the Family Law Act 1975 (Cth), most parties to a parenting dispute must first attempt Family Dispute Resolution (FDR) and obtain a section 60I certificate from an FDRP before they can file an application in court.
Family violence, urgent protection matters, or the refusal of the other party to participate may amount to recognised exemptions. In practice, mediation and out-of-court settlement raise a number of real-world issues, including:
When NS Legal assists with mediation and out-of-court settlement, the focus is on helping the client assess whether mediation is the most appropriate path at this stage, preparing the mediation material, participating in negotiations, and giving the final agreement formal legal effect (including drafting and filing consent orders or a Binding Financial Agreement).
whether mediation is in fact required and whether any section 60I exemption applies;
how mediation works in terms of cost, timing and procedure;
whether an agreement reached at mediation is legally binding and whether further steps are needed;
the circumstances in which mediation is not appropriate and the priority should instead be on seeking court protection or interim orders.
What is Family Law Mediation
Family law mediation is a structured process in which an independent third-party mediator assists the parties to negotiate over disputes about children, property division, spousal maintenance and related issues.
The mediator does not make a decision; rather, the mediator guides the parties in expressing their needs, identifying common interests, and developing workable options, so that the parties can reach their own agreement.
In Australia, family law mediation is generally conducted by an accredited Family Dispute Resolution Practitioner (FDRP). Common providers of these services include:
- Relationships Australia: a government-funded family relationships organisation operating in every state and territory;
- Anglicare, CatholicCare and similar not-for-profit organisations offering FDR services in many regions;
- Family Relationship Centres (FRCs): government-established centres providing initial advice and mediation;
- private FDRPs and mediation organisations: typically handling more complex or higher-asset matters.
It is important to recognise that family law mediation is, by its nature, a negotiation rather than an adjudication.
Even where the mediator is highly experienced, whether an agreement is reached and the content of any agreement remain dependent on the willingness of the parties and the outcome of negotiations.
Mandatory FDR and Section 60I Certificate
Section 60I of the Family Law Act 1975 (Cth) provides that parties to a dispute about parenting arrangements must, as a general rule, make a genuine attempt at family dispute resolution before filing an application with the Federal Circuit and Family Court of Australia (FCFCOA).
This requirement is commonly referred to as “compulsory FDR”. In practice, a section 60I certificate may be issued by an FDRP in any of the following five circumstances:
- the other party refuses to attend mediation;
- the other party fails to attend a scheduled mediation session;
- the mediator forms the view that the matter is not suitable for mediation (for example, where there is a risk of family violence);
- both parties attended mediation but did not reach an agreement;
- both parties attended mediation and reached a partial agreement requiring further determination by the court.
The FCFCOA will only accept a parenting application where a section 60I certificate is on file or a statutory exemption applies.
Exemptions include family violence, child abuse, urgent circumstances and situations where a party is in practice unable to participate (for example, due to long-term imprisonment or a serious health condition).
Mediation in Property Settlement
Unlike parenting matters, Australian law does not strictly require mediation before commencing a property dispute.
However, the FCFCOA generally expects parties to comply with “pre-action procedures” before a property application is filed, including making a genuine attempt to resolve the dispute through negotiation or mediation, disclosing financial information, and exchanging written offers.
The central issues in property mediation typically include:
- identification and valuation of assets: covering real property, superannuation, business interests, trust assets and overseas assets;
- assessment of contributions: the relative weight of financial and non-financial contributions (such as full-time care of children or maintenance of the home);
- assessment of future needs: the parties’ respective ages, health, caring responsibilities, and earning capacity;
- structuring of the settlement: lump-sum payments, asset allocation, superannuation splitting or a combination of these.
Compared with parenting mediation, property mediation usually involves more specialised work in financial disclosure and asset valuation.
In most matters, the parties need to prepare comprehensive financial documents before mediation (including bank statements, valuation reports and superannuation account information) before mediation can meaningfully advance.
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Are Mediation Outcomes Legally Binding
This is one of the most frequent questions clients ask. The oral or written “heads of agreement” reached at a mediation session is typically not, of itself, strictly enforceable in law.
The agreement must be formalised through further legal instruments. In family law, the two most common formalisation routes are:
- Consent Orders: the parties draft the mediated agreement as an Application for Consent Orders and lodge it with the FCFCOA. Once the Court is satisfied that the agreement is just and equitable, it makes an order that has the full force of a court order and is enforceable;
- Binding Financial Agreement (BFA): a financial agreement made under s 90B (before marriage), s 90C (during marriage) or s 90D (after divorce) of the Family Law Act 1975. A BFA does not require court approval, but each party must receive independent legal advice and the lawyer must issue the prescribed certificate before the agreement is binding.
Consent orders are generally more suited to comprehensive agreements covering both parenting and property, given the certainty and ease of enforcement that comes with a court order.
A BFA is more often used for purely financial arrangements, where the parties wish to avoid court processes, or in the context of a second marriage where asset planning is required.
Costs, Timing and Process
Compared with traditional litigation, the cost and time advantages of mediation are the central reasons it is so widely used.
On cost, community-based FDR services (such as Relationships Australia and FRCs) typically offer free or sliding-scale services to lower-income families; private FDRPs commonly charge between AUD 200 and AUD 500 per hour, with a full-day mediation session (around six hours) typically costing AUD 1,500 to AUD 3,500, shared between the parties or apportioned by agreement.
On timing, a typical family law mediation from initial booking to the mediation session usually takes between six and ten weeks (covering intake, risk assessment, separate sessions with each party, and the joint session).
By comparison, waiting times for parenting matters in the FCFCOA are commonly in the order of 12 to 24 months or more. On process, a standard family law mediation typically involves the following stages:
| intake | the mediator meets with each party separately to understand the dispute and the risk factors (including family-violence screening); |
|---|---|
| pre-mediation | information is exchanged, the issues are identified and the schedule is set; |
| joint session | both parties participate together, with discussion facilitated by the mediator; |
| private or shuttle sessions | the mediator speaks with each party separately to help work through impasses; |
| drafting heads of agreement | any consensus reached is recorded in writing; |
| subsequent legal formalisation | the written agreement is converted into consent orders or a BFA. |
When Mediation is Not Appropriate
While mediation is the preferred pathway in most family law matters, it is not appropriate in every situation.
In the following categories of matter, priority should be given to seeking urgent orders or commencing court proceedings directly:
- family violence or risk to personal safety: where there is ongoing family violence, controlling behaviour, or a risk of abuse of children, mediation may aggravate harm or place further pressure on the victim;
- urgent risk to a child’s safety: matters involving unlawful removal of a child, or a risk of interstate or international relocation of children;
- dissipation or concealment of assets: where one party has evidence that the other is transferring, concealing or wasting matrimonial assets, priority should be given to asset-freezing orders or pre-action disclosure;
- substantial power imbalance: for example, where one party has had complete control of the family finances and the other has no knowledge of the assets, court-compelled disclosure may be required first;
- refusal to disclose financial information: in the absence of honest disclosure, mediation will struggle to progress to a substantive agreement.
In these circumstances, applying through the courts at an early stage for a family violence order, urgent interim orders or asset-preservation orders is often the more secure way to protect a client’s lawful interests.
How We Can Help
Family law mediation may appear to be simply a matter of the parties sitting down to talk, but at every step it involves legal judgement and strategic choices: when to start, who participates, how the agenda is set, how the agreement is drafted, and how it connects to court processes.
The role of the NS Legal family law team is to provide targeted legal support at each stage of mediation. We will usually start with a case assessment to determine whether mediation is the most appropriate path at this stage.
Where it is not, we help the client consider alternatives (such as collaborative law, lawyer-led negotiation, or proceeding directly to court). Once mediation is confirmed as viable, the preparation phase begins.
In practice, we are typically able to assist clients to:
- assess the application of section 60I to a parenting dispute and, where appropriate, support an exemption application;
- prepare pre-mediation financial disclosure documents, asset schedules and valuation material;
- develop a mediation strategy, clarify the BATNA (best alternative to a negotiated agreement) and identify the bottom-line position;
- attend mediation sessions with the client (some mediators allow lawyers to attend the session; others permit only off-room advice);
- draft heads of agreement, applications for consent orders and BFA instruments;
- lodge consent orders with the FCFCOA and follow the matter through to the making of the order;
- where mediation does not succeed, help assess next steps — whether further negotiation, a shift to collaborative law, or commencement of court proceedings is appropriate.
Our goal is to enable clients to express their needs fully in mediation while securing a final agreement that is legally robust, so that the agreement itself does not become the source of a fresh dispute later on.
Frequently Asked Questions
Do I need a lawyer to attend mediation
A lawyer is not strictly required. Many FDRPs and family relationship centres in fact encourage parties to attend on their own so that they can express their needs more directly. However, where the matter involves complex property, cross-border assets, superannuation splitting, or the other party is legally represented, attending with a lawyer or having a lawyer available for real-time advice off the room is usually a better way to protect the client’s interests. Whether to attend with a lawyer should be assessed against the circumstances of the matter.
What if the other party refuses to participate
A refusal by the other party to attend mediation is one of the statutory grounds on which a section 60I certificate can be issued. In that situation, the FDRP will generally issue a section 60I certificate and the client may, within 12 months, use that certificate to file a parenting application with the FCFCOA. Once it is clear that the other party will not participate, it is best to contact the FDRP promptly to obtain the certificate so that there is no delay to the subsequent process.
Can a mediated agreement be revoked
This depends on whether the agreement has already been formalised in a binding legal instrument. A heads of agreement that has not been further formalised will generally not be enforceable and can, in theory, be re-negotiated. Once an agreement has been formalised by way of consent orders or a BFA, however, it carries legal force, and setting it aside becomes substantially more difficult — generally requiring grounds such as fraud, duress, material mistake or a statutory ground. Comprehensive legal advice should be obtained before signing any formal instrument.
Can mediation proceed where there is family violence
Generally, it is not advisable. FDRPs conduct family-violence screening at intake. Where the assessment indicates ongoing family violence or that the party will not be able to negotiate freely in the presence of the other party, the mediator may issue a section 60I certificate on the basis that the matter is not suitable for mediation and recommend that the client seek a court remedy or apply for a family violence order. In these matters, safety should take priority over process.
How long does property mediation take
The duration depends on the complexity of the matter. Straightforward matters (where the parties broadly agree on the asset pool and contributions) may reach agreement within one or two mediation sessions, with the overall process taking around two to three months. Matters involving business valuations, superannuation, trusts or overseas assets typically take four to eight months, during which time valuation reports must be prepared, independent experts may need to be engaged, and multiple rounds of negotiation will usually be required. Thorough financial-disclosure preparation in advance can substantially shorten the mediation cycle.
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