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Home > Judgments > 2009 archive

L v K (Jud re Costs) [2009] EWHC 2213

Judgment concerning costs in ancillary relief proceedings involving conduct, inherited wealth and post-nuptial agreements and where the husband had been convicted and jailed for sexually abusing his step-granddaughters. The husband was ordered to pay a £50,000 contribution to the wife's costs because of his conduct in the proceedings.

IN THE HIGH COURT OF JUSTICE
FAMILY DIVISION                          
[2009] EWCH 2213 (Fam) 
FD07D05911

Thursday, 4th June 2009

Before:

MR. JUSTICE MOYLAN (In Private)

B E T W E E N :

L (Petitioner)

-  and  -

K (Respondent)


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__________


MR. J. TURNER QC and MISS LISTER appeared on behalf of the Petitioner Wife.
MR. V. LE GRICE QC appeared on behalf of the Respondent Husband.

__________

This judgment is being distributed on the strict understanding that in any report no person other than the advocates or the solicitors instructing them (and other persons identified by name in the judgment itself) may be identified by name or location and that in particular the anonymity of the children (grandchildren) and the adult members of their family must be strictly preserved.

J U D G M E N T

MR. JUSTICE MOYLAN
1. Having just given judgment in this ancillary relief case, I now turn to deal with the issue of costs.  Mr. Turner, on behalf of the wife, submits that the husband should make a contribution towards the wife's costs.  Her total costs of these proceedings are just over £250,000.  That sum has been paid by her, so when, in the course of my judgment I have referred to the wife's resources, this has been after the payment by her of those costs.  He submits that the case advanced by the husband in these proceedings has been "hopeless" and that he should make a contribution in the sum of £100,000 to the wife's costs.  He also submits, in order to meet the argument deployed by Mr. Le Grice to the effect that the wife has made no "effective" offer, that the husband could have made an offer as easily as the wife.

2. Mr. Le Grice, who, as I have already indicated, came into this case on the first day of the hearing when the husband obtained public funding, has informed me that the current limit imposed by the Legal Services Commission in respect of the husband's costs is £20,000, possibly exclusive of VAT.  That sum may be reduced by the Legal Services Commission on analysis of the costs' bill put in by the husband's solicitors.  Mr. Le Grice considers it possible that the amount might be increased.  He submits that there should be no order for costs.  He bases his submission on the fact that the wife did not make any open offer until the first day of the hearing when the wife openly repeated the offer she had made in the letter of 25th February 2009 in which she proposed a payment to the husband of £100,000 in return for the transfer to her of his interest in the overseas property.  Mr Le Grice submits that it was always open to the wife to accept the validity of the husband's claim in respect of that amount.  He submits that I must be cautious to avoid double-counting – and I will come to that again in a moment – and he submits that I must take into account the impact of costs, in particular on the husband.

3. The rules provide that: "The general rule in ancillary proceedings is that the court will not make an order requiring one party to pay the costs of another party; but the court may make such an order at any stage of the proceedings where it considers it appropriate to do so because of the conduct of a party in relation to the proceedings (whether before or during them)".  Accordingly, under the rules the focus is on the conduct of the parties in relation to the proceedings.  It is this which leads Mr. Le Grice to submit that I must be cautious to avoid double-counting because I have, of course, taken into account the husband's during the marriage conduct when arriving at my substantive decision.

4. The rules further provide that, in deciding what order (if any) to make under the previous provision, I must have regard to a number of factors, being:

"(a) any failure by a party to comply with these Rules …;
(b) any open offer to settle made by a party;
(c) whether it was reasonable for a party to raise, pursue or contest a particular allegation or issue;
(d) the manner in which a party has pursued or responded to the application or a particular allegation or issue;
(e) any other aspect of a party's conduct in relation to the proceedings which the court considers relevant; and
(f) the financial effect on the parties of any costs order."

5. I take all those factors into account; in particular, the financial effect on the parties of any costs order and the offers to settle which have been made in these proceedings.  In respect of the latter, I note in particular that no offer was made throughout these proceedings by or on behalf of the husband and that no indication was given of the actual nature of his claim, beyond what was set out in his Form E which was, it must be said, rather an exaggerated claim, until Mr. Le Grice, when opening this case on behalf of the husband, stated what amount was being sought on his behalf.  I also take into account that the wife's offer was not made an open offer until the first day of the hearing.  I am not convinced that that does not permit me to have regard to the offer as being an effective offer from the date on which it was made, but both counsel submit that I should view it as being an offer only from the date on which it was made an open offer.

6. I must assess the conduct of the parties in relation to the proceedings -  in particular the way in which the parties have pursued their respective cases – when determining whether it is appropriate to make any order for costs and, if so, what order.  In assessing the conduct of the parties and in particular, as I have indicated, the offers, I have no doubt that, in apportioning responsibility for these proceedings and in looking at the conduct of the parties in relation to the proceedings, the husband bears a far greater responsibility for the continuation of these proceedings to their ultimate determination before me today than the wife.  He never made any offer.  He contested a number of the allegations raised by the wife when, in my view, it was not reasonable for him so to do. 

7. Having regard to the husband's conduct in these proceedings, I am satisfied it is appropriate to order the husband to make a contribution towards the wife's costs.  I propose to determine the amount on a very broad analysis.  The order  I make is that the husband shall pay a contribution towards the wife's costs in the amount of £50,000, inclusive of VAT, but that otherwise there will be no order as to costs. 

8. I have, of course, taken into account the effect of this order on the husband's resources especially when added to the costs which he will be required to pay the Legal Services Commission.  I have considered the impact it will have overall on his wealth.  In my view, notwithstanding that impact, it remains a just order in the circumstances of this case.

9. The two other matters I must deal with are, first, the proposal made by Mr. Le Grice that the amount which I have ordered to be paid to the husband should be by way of a settlement of property, at his election.  I reject that submission.  In my view, the sum should be paid simply as a lump sum - in return for the transfer by the husband of his interest in the jointly held overseas property to the wife.  What I propose to order is that the transfer should be effected within two months of today and that the lump sum payment should be made simultaneously with the transfer.

10. The final point I must deal with is at the request of the press.  They have asked whether, notwithstanding the order I made at the outset of this hearing, to the effect that the identity of those involved, in order to protect the children involved, should remain anonymous, they are entitled to refer to the nature of the husband's prior occupation.  When considering the purpose of my order, which is to protect the interests of the children who are connected with these proceedings, in my view, the right balance, having regard to their interests and the other factors which I have to take into account, is that I should give the press permission to identify or refer to the nature of the husband's prior occupation.  I do not think that this is likely significantly to damage the interests of the children connected with these proceedings.