Scandalous
In the recent case of JE (husband) v ZK (wife) [2015] EWHC B87 (Times Report by Frances Gibb here), ‘scandalous‘ divorce costs drove the wife to attempt suicide. In a case where the size of the matrimonial pot was £350,000, between them the couple had incurred fees of £120,000 and of that the wife’s were £80,000. In the report it states that Judge Wildblood said if, “legal costs had been approached sensibly”, it would have been enough for the man and woman “to be housed” and have enough money left to “go round”. Furthermore, condemning the costs run up to date, he was “particularly critical” of the size of the woman’s bill – which he said was unjustified.
Capped, Fixed, Proportionate
This is the latest in a string of judgments where the courts are making it crystal clear that divorce costs need to be reined in. Talk of capping fees, price fixing and proportionality abound in cases presided over by Moylan J (J v J [2014] EWHC 3654 (Fam)) which was featured in our blog at the time here.
In the case of Chiva v Chiva [2014] EWCA Civ 1558 (03 December 2014) Lord Justice McFarlane expressed astonishment that costs of £174,000 could be incurred by the wife aswell as £60,000 by the husband. In that case, the capital assets for division amounted to £415,659. The divorce costs prior to the Appeal were therefore more than 50% of the value of the matrimonial pot.
And again, in the case of Seagrove v Sullivan [2014] EWHC 4110 (Fam) (03 December 2014), Mr Justice Holman expressed his exasperation at the disproportionate costs that had been incurred relative to the value of the available assets referring to the “appalling profligacy of their legal expenditure”. Between them, the couple had incurred £1.3 million in costs. They were arguing about an asset worth £1 million, and therefore over £500,000 each. That meant the costs incurred by the couple were roughly three times the value of the assets in dispute. More details appeared in our blog ‘Fixed Fees in the spotlight‘ here.
Financial Remedies Working Group
In January of this year, Paradigm Family Law commented (here) on the report by the Financial Remedies Working Group in which they specifically commented on legal costs in family law financial proceedings as follows:
…..22. It is clear that many people feel that the method by which most family lawyers charge (on a time charge basis) is unpredictable and that the overall levels of costs are high. The group believes that this in part drives some litigants to act in person rather than to instruct solicitors.
23. The group has received representations regarding the re-introduction of the Calderbank system. The group is opposed to its reintroduction but does recognise that litigation misconduct needs to be addressed. Rule 28.3 of the Family Procedure Rules 2010 enables the Court to make orders for costs where there is litigation misconduct. This rule needs to be applied more generally. The group would wish to emphasise that litigants-in-person are not immune from its consequences.
24. Mostyn J in J v J [2014] EWHC 3654 (Fam) expressly raised the possibility of fixed price costing and judicial costs capping. The group noted this development, but also noted that these are complex and difficult issues for practitioners and that it would not be appropriate to take the issues further until professional bodies such as Resolution, the Law Society and the FLBA have been given the opportunity to engage in a discussion on the subject.
25. The group suggests that the costs working party of the Family Procedure Rule Committee should be invited to give consideration to costs issues, including the issues of fixed price costing and judicial costs capping…….”
Divorce costs, fixed
At Paradigm Family Law, since we opened our doors last year we have offered fixed fees to all clients in divorce and financial remedy proceedings. We pioneered the fixed fee approach in which we offer a fixed fee from the outset of the case for not just the divorce, but the financial remedy proceedings aswell. All of our clients on fixed fees know from Day 1 what they will pay to bring them to the end of their case. They will not have to face the dreadful situation that the couples in the reported case and those others highlighted above have had to deal with at what is already one of the most stressful life experiences anyone has to endure.
There is a better way…
What more will it take for there to be a legislative change in the way costs in financial remedy proceedings are handled? We at Paradigm Family Law are sure of one thing – our clients love our fixed fee approach.
Since setting up last year, our USP seems to be catching on and not just with our clients, but seemingly with the Judiciary aswell if the comments of Mostyn J et al are anything to go by. But don’t just take their word for it – see for yourself. Give Paradigm’s Family Law experts James Thornton and Frank Arndt a call today on 0845 6020422 or email us at [email protected] and ask about our fixed fees and free initial consultation.
