The annual value of the family law market reached £2 billion for the first time last year, marking a 4.5% increase, according to research by IRN Legal. This growth was driven in part by an increased demand for financial advice, even as the number of divorces filed decreased in 2023 following the introduction of no-fault divorce the previous year. Financial remedy case starts, in particular, saw a significant rise of over 13%.
Market Trends and Future Growth
The UK Family Law Market Trends Report 2024 projects the market will continue to grow by 4.5% annually over the next three years. This sustained growth is expected despite the abolition of mandatory mediation in January 2024, with changes to the Family Procedure Rules now promoting alternative dispute resolution (ADR) as a way to alleviate the burden on family courts, which are currently experiencing delays and backlogs.
The average time from the date of petition to decree nisi/conditional order increased to 42 weeks last year, up from 38 weeks in 2022. The mean average time from petition to decree absolute/final order rose to 69 weeks, an increase of two weeks. The need for quicker resolutions and greater transparency in family courts is pushing more cases towards ADR.
Innovations in Family Law Services
Virtually all leading family law brands now offer a ‘one lawyer, one couple’ service. This approach not only helps to expedite legal processes but also opens up opportunities for related legal services such as will writing, conveyancing, and wealth management advice. Although this model might reduce the volume of family law work, it potentially increases revenue from associated legal services.
Demand is also rising for services related to pre-nuptial agreements, co-parenting, counselling, and overall well-being, indicating a shift towards more holistic family law services.
Decline in Family Law Firms
The number of family law firms in England and Wales has decreased significantly, from over 5,700 in 2018 to fewer than 4,800 in 2024. This decline is attributed to mergers and acquisitions by larger consumer law firms and specialist family law brands, which are consolidating their market share through office network expansion.
At the upper end of the market, international law firms handling legal issues for high net-worth individuals and cross-border matters continue to thrive, contributing to healthy growth in this segment.
Prospects for Cohabitation Rights
Despite the stalling of the Cohabitation Rights Bill introduced in 2019, IRN expects progress in improving legal rights for cohabiting couples, a reform supported by the Labour Party. The number of cohabiting households has grown from 3.18 million to 3.69 million between 2016 and 2022, while the number of registered marriages has remained relatively stable at 12.65 million.
The family law market is undergoing significant changes driven by increasing demand for financial advice, the adoption of innovative service models, and a shift towards ADR to manage court backlogs. These trends suggest continued growth and evolution in the market, with new opportunities emerging for legal service providers.
Comments