As Dr Alon Kaplan TEP, pointed out to me this morning
in a comment on one of my recent posts about the use of Family Investment Companies (‘FIC’s’) in estate planning, ‘I think it would be interesting to consider an arbitration procedure within the articles of associations of the FIC. As you know this issue is problematic in a trust. But as part of a company constitution documents, it should work.’
This is a very smart observation, and see paragraph
12.5 ‘Arbitration’, of my book the ‘Contentious Trusts Handbook’ for a full discussion of the issues and potential solutions. Dr Kaplan’s comment made me think about two more connected issues:
1. Use of an LLP instead of a FIC (which is popular as a tax-efficient wealth planning vehicle in international estate planning e.g. in Lichtenstein), and is highly adaptable to the Sharia compliance needs of Middle Eastern families. See:The ‘Keystone Structure’ | Carl’s Wealth Planning Blog

2. The inclusion in the FIC articles of a ‘two tier’ ADR clause, i.e. for Mediation, followed by Arbitration, or some form of non-judicial ENE, e.g. Adjudication by a panel of TEP’s?
Adjudication is a highly appropriate method of ADR for Probate/Trust disputes, either on its own, or possibly as a first step prior to mediation, i.e. to help parties to gain a more objective and realistic view of their respective positions, and where appropriate to shift from unrealistic positions, e.g. where one or more of the parties has taken an unrealistic and entrenched view of an issue in dispute, or of the case as a whole, and would benefit from an assessment of the particular issue, or case, by an independent expert/specialist practitioner. I would be interested to hear your views and about your experience, as Adjudication is rarely proposed as a form of ADR in domestic probate/trust disputes.

I am currently developing a new form of ADR which I call ‘Expert Mediation’, which involves:

·       Adjudicative evaluation by one Mediator (‘A’) with the conclusion being communicated before the start of the mediation day to: (i) the other Mediator (‘B’), and to each participant separately, about the legal and procedural merits of their own case (but not to their opponent).

·       Facilitative Mediation being led by Mediator B with Mediator A being available for consultation by Mediator B and the participant in the each private session. I will write a further post about this in due course.