Couples are increasingly settling divorce disputes outside court through a new American-style method which could be extended to other litigation, one of Britain's top judges said last night.

Lord Kerr of Tonaghmore, a justice in the UK's new Supreme Court, said that there had been an "impressive" take-up in the use of what is called the "collaborative" approach to divorce.

In 2003, only four lawyers in England were offering the new out-of-court method, he said. Now the number had risen to 1408 in England and Wales and 100 in Northern Ireland - with a rise of 87 per cent in cases to an estimated several thousand a year.

Lord Kerr, a former Lord Chief Justice of Northern Ireland, added: "Perhaps the most inspiring statistic of all is that of the settlement rate of collaborative law cases - a remarkable 85 per cent."

Addressing leading family lawyers in London last night at an event to celebrate collaborative law, Lord Kerr added that the essence of the approach could be applied in commercial and other disputes.

The essence, he added, was not victory by one side over the other or "the vindication of one viewpoint at the expense of an opponent's."

"Rather the fundamental purpose is to shape a solution to the problems experienced by the parties that not only resolves the immediate dispute, but which will endure to sustain a relationship after the parties have left the stage."

This goal was not just "an incidental side effect of civilised negotiations", he added. "It reflects its centrality to the entire process."

It required more than civility and courtesy; it required the mindset that asks: what is best for my client and the fashioning of an outcome that was best for all those affected, such as the children, in the dispute.

Some leading family law firms now maintain that one in three of their cases are handled under the collaborative approach.

It involves the two sides holding a series of discussions, with lawyers present, and having agreed they intend not to litigate and resort to court. If negotiations fail, and court is the only option, the husband and wife have to instruct new lawyers.

The idea is to keep negotiations respectful and non-aggressive - as well as keeping down legal costs - and to achieve a solution in a non-gladiatorial atmosphere.

But in a warning note, Lord Kerr said that one danger was that its very success might act as a disincentive to the courts system to look at ways of improving its own procedures by adopting some of the best collaborative features.

"Put crudely and simply, if court procedures are deficient, should the answer be the espousal of a system entirely outside the courts?"

Or, he added, should the advantages of collaborative law "act as a spur" to adapting court procedures for those who have to resort to use them?

Although most collaborative law took place in family cases, it might translate to other fields, he said.

"One can see the scope for its introduction to some types of commercial dispute" although whether it could be extended to other areas, such as public law, were "more imponderable."

But there was no reason why it should not at least be tried, he said.

Otherwise, he warned, there could be the creation of a parallel system of resolving disputes outside the courts, with "profound implications for the development of the law."