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FRB v DCA No.2 [2019] EWHC 2816 (Fam)

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This judgment was delivered in private. The judge has given leave for this version of the judgment to be published on condition that (irrespective of what is contained in the judgment) in any published version of the judgment the anonymity of the children and members of their family must be strictly preserved. All persons, including representatives of the media, must ensure that this condition is strictly complied with. Failure to do so will be a contempt of court

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[2019] EWHC 2816 (Fam) (No.2)

Royal Courts of Justice
London, WC2A 2LL

Monday, 28 October 2019


(In Private)


-  and -
DCA Defendant

MR J. GRUDER QC (instructed by Vardags) appeared on behalf of the Claimant Husband.
MR T. MUNBY (instructed by Payne Hicks Beach) appeared on behalf of the Defendant Wife.

1. I have this morning handed down judgment in this matter and I now have to deal with ancillary matters.  The first two are interrelated or, if not interrelated, at least broadly within the same area of debate, namely what costs order should I make, if any, and whether or not there should be a payment on account.

2. First of all, there is no doubt that the wife has "won" this litigation.  She has been the successful party in the proceedings and, as such, she is entitled to her costs.  Mr Gruder's suggestion that I should park the issue until the financial remedy proceedings are concluded and I have heard the evidence is an unattractive argument.  I have to deal with the matter now and I will be in a better position to deal with it now than I will be at a later stage, or at least in no worse a position.  In fact, if I did put the matter off and there had to be another hearing, there would be Mr Gruder and Mr Munby arguing the same points as they have argued in front of me today, with the consequent additional cost. 

3. The second issue then is whether or not I should make an order for indemnity costs, as the wife seeks, or an order on the standard basis, as the husband seeks.  My view is that costs should be ordered on a standard basis.  This is not a classic fraud case.  This is a case where in fact I have not come to any conclusions about the underlying subject matter of the action, namely whether or not the wife has misled the husband in relation to the paternity of C. 

4. Further, this is a human tragedy for both sides that I am dealing with and I think that anything that I do to raise already very high temperatures is to be avoided.  Thirdly, the issues that have arisen in the deceit proceedings will in a different form appear in the financial remedy proceedings and whilst I have found that the husband has approached the problem, if I can put it this way, in completely the wrong way, I have not found that there is not a problem.

5. I do not think in coming to a decision on this matter, I am significantly influenced by the fact that the husband has launched proceedings in all three divisions of the High Court.  The husband has not lost on all the points argued before me and nor has the wife covered herself in glory in some of the answers that she has given to questions that have been asked of her in the proceedings.  All these factors point to an order on the standard basis.

6. The third issue then is to what extent do I limit the wife's costs and bring her down from 100 per cent.  In my judgment, it is right that there should be a deduction, principally for the reasons that have been articulated in front of me, namely that a considerable amount of time has been spent on an issue (whether the tort of deceit can exist between husband and wife in intimate matters) on which the wife has not succeeded.  There is no doubt that argument will have increased the costs to some extent.  Secondly, it is fair to say that the husband has succeeded in flushing out an element of the case in which the wife has been less than honest and, thirdly, that some, but a small element of the material that has come out in these proceedings will be of use in the financial remedy proceedings. 

7. Mr Gruder places in front of me the idea that I should make an issue-based award.  I decline to do that.  It seems to me that the only people who would benefit from it would be the costs draftsmen.  This is one of those cases where it is simply not possible to identify and cost an issue as a discrete issue.  It is very different from those cases where perhaps there is a major argument about the valuation of a particular asset where it is easy to hive off the relevant costs but that does not apply in this case. 

8. The order that I have determined that I will make is that the husband will pay 80 per cent of the wife's costs of the action including the strike-out.

9. I come now to the question of payment on account.  The rules are clear: I shall order a party to pay a reasonable sum on account of costs unless there is good reason not to do so, and there is no good reason for me not to do so.  Mr Gruder perfectly properly raises the issue that a large amount of the wife's costs will be challenged as being necessary or proportionate and I bear that in mind. 

10. I calculate the sum that I will order as follows, starting with figures net of VAT:  of her bill of £376,000 costs, I reduce the figure by 80 per cent, which produces a figure of £300,800.  I then for the purposes of a payment on account order that the husband pays what I calculate as 55 per cent.  That is a relatively modest percentage if, as the parties agree, the wife can expect to recover 70 to 75 per cent, which produces a figure of £165,400, to which I then add VAT, which brings a figure of just under £199,000.  I am going to round it to £200,000.  Therefore, I shall order that the husband pays £200,000 inclusive of VAT on account of costs, and I gain such comfort as I can from the fact that if I have in any sense overshot the mark, which I think is very unlikely, then that is something that can be ironed out in due course.  Whatever the outcome of the financial remedies' litigation, the wife will be in a position to make any refund of funds that may be necessary. 


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