Nicholas Allen KC sitting as a deputy High Court judge.

Facts

Application for a legal services payment order within high net worth financial remedy proceedings.

W’s LSPO application was for H to meet the costs of £241,269 in unpaid invoices for historic legal costs; £651,288 in financial remedy costs up to and including the PFDR appointment; £46,668 for MPS; and £181,542 for FLA 1996. H did not oppose the making of a LSPO in principle and offered to pay £250,000 on the condition that W did not ask for any further sums for costs before the PFDR appointment, or in relation to any other matters, up to and including that date.

Legal principles

Under the Matrimonial Causes Act 1973, s 22ZA, the court may make an order requiring one party to pay to the other an amount for the purpose of enabling the applicant to obtain legal services for the purposes of the proceedings. The judge considered that the following LSPO jurisdiction should be viewed as part of the broad discretion available to judges:

• Rubin v Rubin – a court cannot make such an order unless it is satisfied that, without the payment, the applicant would not reasonably be able to obtain appropriate legal services for the proceedings.
• DH v RH [2023] EWFC 111 – the essential question is whether ‘the court is satisfied that without such a payment the applicant will not reasonably be able to obtain in the future appropriate legal services for the proceedings’.

Judgment

The judge ordered H to pay W’s solicitors £177,975 in historic costs, £500,000 in relation to future financial remedy costs, and £75,000 in respect of FLA 1996 costs. The MPS element was adjourned because W issued a fresh application and procedural fairness required that H have the opportunity to respond.

The payment for the ongoing financial remedy proceedings was recoverable as without it W would not reasonably be able to obtain appropriate legal services. The £500,000 for future costs to take the case to the conclusion of the PFDR appointment in June 2025 was reasonable based on the resources, the history of the litigation to date, the issues the case engages, its complexity and predictability. The judge refused to order payment in relation to the previous proceedings under FLA 1996 for occupation orders as the proceedings have already concluded and had been compromised as no order for costs.

Cobb J instigated a practice of making a deduction to account for a standard basis of assessment, on the basis of CPR Part 44. There has since been some judicial inconsistency. Here, the judge did not consider it appropriate to apply such a discount because CPR Part 44 does not apply to LSPOs as they are not costs orders. In his view a court should start from a presumption that the costs have been properly incurred and therefore, unless it can be established to the contrary, should be met under the LSPO.

Costs

The parties’ combined costs for the financial remedy proceedings alone exceeded £675,000. If the case continues in its present trajectory, then similar adjectives to those used below by judges may be appropriate:

• Crowther v Crowther & Ors [2022] 2 FLR 243 – parties ran up costs of £2.3m in just over two years and were described by Peel J as ‘nihilistic’.
• Xanthopoulos v Rakshina [2023] 1 FLR 388 – incurred costs of £5.4m and potential future costs of £1.8m and £2.6m were described by Mostyn J as ‘beyond nihilistic’ and ‘apocalyptic’.