Family financial court proceedings and cost orders

In the majority of litigation court cases, the loser has to pays the legal costs of the winner. That can be a powerful deterrent to litigation. Failure can mean that not only do you not get damages or compensation but you could be wiped out financially through paying the winner’s legal costs.

The top London divorce solicitors will tell you that in family financial court proceedings the cost rules are different. The normal rule on paying legal costs in financial court proceedings is that the family court judge will not make an order requiring one spouse to pay the costs or pay a contribution towards the costs the other spouse. Therefore any financial family court proceedings come with a health warning that the likelihood is that you will have to pay your own legal costs, win or fail.

However, the best London divorce solicitors will tell you that the family court judge may depart from this costs rule. You therefore cannot start or continue family court proceedings thinking that you will only be responsible for your own legal costs, win or fail. That is because if the court it considers it appropriate to do so , for example because of one spouse’s conduct before or during the court proceedings, the family judge can make a costs order.

The court of appeal case involving Mr Lemmens and his former wife emphasises the importance of preparation in family financial court cases. It also highlights the benefits of taking top London divorce solicitors advice to avoid a victory being overshadowed by a family court costs order.

How can OTS Solicitors help?

If you need legal advice on a financial settlement or financial court proceedings then OTS Solicitors’ divorce and family finance team can help you.

For a confidential discussion on how OTS Solicitors can help you in negotiating a financial settlement or by providing representation in court proceedings please call us on 0203 959 9123 .

Financial court proceedings and costs orders

The 2018 court of appeal case of Lemmens v Barbara Brouwers provides a salutary reminder that some court cases are not just about “winning”. This court case shows how, even in victory, a spouse in family court proceedings can achieve very little in real terms because of the impact of a court costs order.

The best London divorce solicitors will have read the court of appeal judgement of the case of Mr Lemmens and his former wife Mrs Brouwers with interest because of the lessons that can be learnt from it by spouses and family law practitioners.

The case of Lemmens v Barbara Brouwers (Ex Lemmens) [2018] EWCA Civ 2963 (27 November 2018) concerned a husband’s application to the family court to reduce the amount that he was paying in spousal maintenance to his former wife, Barbara Brouwers. To all intents and purposes, Mr Lemmen’s case was a success story as the family court agreed that the spousal maintenance payments should be reduced. However, the sting in the tail was the costs order. The family judge ordered the husband to pay £30,000 as a cost contribution towards his former wife's legal costs. Anyone with a calculator will realise that Mr Lemmens could have continued to pay a higher rate of spousal maintenance for a long time and avoid the cost order made against him. However, the real issue is how did the winner of the court case turn into the loser?

That was the question that the husband in the case of Lemmens v Brouwers wanted answers to. He appealed against the £30,000 costs order. The court of appeal upheld the costs order. Perhaps fortunately for Mr Lemmens his former wife was not legally represented at the court of appeal hearing and the appeal court therefore does not appear to have made a further costs order against Mr Lemmens for the failed court of appeal hearing.

Family court costs orders and preparation

To top London divorce solicitors it is crucial that London divorce solicitors and spouses learn the lessons from the Lemmens court case.

The court of appeal said that the family judge was right to make the £30,000 costs order against the husband as the judge had found that, up to the start of the financial court hearing, Mr Lemmens had not properly explained his financial situation to his former wife or to her divorce solicitors.

The judge went as far as to say that the husband's Form E financial disclosure document was “deliberately misleading”. The judge at the court hearing justified the cost order against the husband on the basis that his former wife had spent a lot more on her divorce  solicitors and in legal bills than she would have otherwise done if the husband had explained the rationale behind his application to reduce the spousal maintenance payments. This was because the husband's financial disclosure and Form E paperwork appeared to show that the husband's income had not changed since the spousal maintenance order was made. That meant the wife was not prepared to agree to a reduction in spousal maintenance and led to costs being incurred to investigate the husband's financial disclosure and to oppose his court application.

The husband argued against the costs order on the basis that he had provided Form E financial disclosure and that even if his financial disclosure was not detailed enough the wife had not incurred an extra £30,000 of legal costs as a result.

To the best London divorce solicitors the case emphasises the importance of ensuring that Form E financial disclosure is detailed and accurate. Top London divorce solicitors tend to find that sometimes those with complex investments or those who hold shares in a family business do not explain their financial affairs fully in their Form E. In many cases that can be down to an assumption that their former spouse, their divorce solicitors and even the judge will understand their financial affairs without an explanation of the asset structure or how income is generated. This can be a costly mistake, as all too often spouses do not necessarily have the knowledge base that their spouses assume that they have, and that compounded by a spouse’s suspicion about their former partner’s financial affairs can lead to more investigations and higher legal costs.

Family costs orders and summary assessment

The husband also argued that it was unreasonable to make a costs order against him when his former wife's divorce solicitors had filed a cost form, called a form H, late. Furthermore, the husband said that the judge should not have assessed the costs at £30,000 but instead the costs award should have been subject to a detailed assessment process. The court of appeal disagreed with these grounds of appeal and upheld the costs order.

However, recent litigation rulings do not give the best London divorce solicitors any reason to be complacent about not meeting court deadlines for the filing of court paperwork. That is because in a number of recent civil litigation cases courts have very strictly enforced court deadlines. In this family case, the court of appeal decided that the husband had not been prejudiced by the late filing of his former wife's costs form H. Accordingly the court of appeal held that the judge was entitled to decide to assess the costs summarily at £30,000.

The case of Mr Lemmens really emphasises the importance of taking legal advice from the best London divorce solicitors and just how vital it is to provide full and frank financial disclosure. The financial disclosure needs to be given at the outset of a court application to avoid cost penalties.

How can OTS Solicitors help?

For advice on costs orders in financial court proceedings or representation in financial court proceedings or advice on your financial settlement options please call OTS Solicitors on 0203 959 9123 for a confidential discussion about how the London divorce solicitors at OTS Solicitors can help you.