The judge hereby gives leave for it to be reported.
Strand, London, WC2A 2LL
B e f o r e :
| Marie Louise Rubin
- and -
Jeffrey Jacques Rubin
Mr Christopher Hames (instructed by Brethertons Solicitors) for the Respondent
Hearing dates: 5 March 2014
Crown Copyright ©
Mr Justice Mostyn :
i) An application by the applicant ("the wife") for a legal services payment order ("LSPO") pursuant to s22ZA Matrimonial Causes Act 1973 in the sum of £7,268 to cover costs incurred in financial remedy proceedings.
ii) An application by the wife for an order for a lump sum pursuant to s15 and Schedule 1 para 1(2)(c) Children Act 1989 of £15,700 to cover costs incurred in proceedings under the 1980 Hague Convention on the Civil Aspects of Child Abduction (as incorporated into our law by the Child Abduction and Custody Act 1985).
iii) An application by the respondent ("the husband") for an order granting permission to appeal the order of Deputy District Judge Elliot dated 28 February 2014 whereby he excepted from a stay which he granted of the wife's divorce proceedings her application for the LSPO. If permission is granted the husband would wish the appeal to be dealt with immediately and allowed.
Legal Services Payment Order
"The statutory provision, in my judgment, does no more than to codify the principles to be collected in this regard in the authorities, most recently in Currey v Currey  1 FLR 946. Under s. 22ZA(3) the court cannot make a costs allowance unless it is satisfied that without the amount of the allowance, the applicant would not reasonably be able to obtain appropriate legal services for the purposes of the proceedings or any part of the proceedings, and for the purposes of this provision the court must be satisfied in particular that the applicant is not reasonably able to secure a loan to pay for the services (see s. 22ZA(4)(b))."
i) When considering the overall merits of the application for a LSPO the court is required to have regard to all the matters mentioned in s22ZB(1) (3).
ii) Without derogating from that requirement, the ability of the respondent to pay should be judged by reference to the principles summarised in TL v ML  EWHC 2860 (Fam)  1 FCR 465  1 FLR 1263 at para 124 (iv) and (v), where it was stated
"iv) Where the affidavit or Form E disclosure by the payer is obviously deficient the court should not hesitate to make robust assumptions about his ability to pay. The court is not confined to the mere say-so of the payer as to the extent of his income or resources. In such a situation the court should err in favour of the payee.
v) Where the paying party has historically been supported through the bounty of an outsider, and where the payer is asserting that the bounty had been curtailed but where the position of the outsider is ambiguous or unclear, then the court is justified in assuming that the third party will continue to supply the bounty, at least until final trial."
iii) Where the claim for substantive relief appears doubtful, whether by virtue of a challenge to the jurisdiction, or otherwise having regard to its subject matter, the court should judge the application with caution. The more doubtful it is, the more cautious it should be.
iv) The court cannot make 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. Therefore, the exercise essentially looks to the future. It is important that the jurisdiction is not used to outflank or supplant the powers and principles governing an award of costs in CPR Part 44. It is not a surrogate inter partes costs jurisdiction. Thus a LSPO should only be awarded to cover historic unpaid costs where 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.
v) In determining whether the applicant can reasonably obtain funding from another source the court would be unlikely to expect her to sell or charge her home or to deplete a modest fund of savings. This aspect is however highly fact-specific. If the home is of such a value that it appears likely that it will be sold at the conclusion of the proceedings then it may well be reasonable to expect the applicant to charge her interest in it.
vi) Evidence of refusals by two commercial lenders of repute will normally dispose of any issue under s22ZA(4)(a) whether a litigation loan is or is not available.
vii) In determining under s22ZA(4)(b) whether a Sears Tooth arrangement can be entered into a statement of refusal by the applicant's solicitors should normally answer the question.
viii) If a litigation loan is offered at a very high rate of interest it would be unlikely to be reasonable to expect the applicant to take it unless the respondent offered an undertaking to meet that interest, if the court later considered it just so to order.
ix) The order should normally contain an undertaking by the applicant that she will repay to the respondent such part of the amount ordered if, and to the extent that, the court is of the opinion, when considering costs at the conclusion of the proceedings, that she ought to do so. If such an undertaking is refused the court will want to think twice before making the order.
x) The court should make clear in its ruling or judgment which of the legal services mentioned in s22ZA(10) the payment is for; it is not however necessary to spell this out in the order. A LSPO may be made for the purposes, in particular, of advice and assistance in the form of representation and any form of dispute resolution, including mediation. Thus the power may be exercised before any financial remedy proceedings have been commenced in order to finance any form of alternative dispute resolution, which plainly would include arbitration proceedings.
xi) Generally speaking, the court should not fund the applicant beyond the FDR, but the court should readily grant a hearing date for further funding to be fixed shortly after the FDR. This is a better course than ordering a sum for the whole proceedings of which part is deferred under s22ZA(7). The court will be better placed to assess accurately the true costs of taking the matter to trial after a failed FDR when the final hearing is relatively imminent, and the issues to be tried are more clearly defined.
xii) When ordering costs funding for a specified period, monthly instalments are to be preferred to a single lump sum payment. It is true that a single payment avoids anxiety on the part of the applicant as to whether the monthly sums will actually be paid as well as the annoyance inflicted on the respondent in having to make monthly payments. However, monthly payments more accurately reflects what would happen if the applicant were paying her lawyers from her own resources, and very likely will mirror the position of the respondent. If both sets of lawyers are having their fees met monthly this puts them on an equal footing both in the conduct of the case and in any dialogue about settlement. Further, monthly payments are more readily susceptible to variation under s22ZA(8) should circumstances change.
xiii) If the application for a LSPO seeks an award including the costs of that very application the court should bear in mind s22ZA(9) whereby a party's bill of costs in assessment proceedings is treated as reduced by the amount of any LSPO made in his or her favour. Thus, if an LSPO is made in an amount which includes the anticipated costs of that very application for the LSPO, then an order for the costs of that application will not bite save to the extent that the actual costs of the application may exceed such part of the LSPO as is referable thereto.
xiv) A LSPO is designated as an interim order and is to be made under the Part 18 procedure (see FPR rule 9.7(1)(da) and (2)). 14 days' notice must be given (see FPR rule 18.8(b)(i) and PD9A para 12.1). The application must be supported by written evidence (see FPR rule 18.8(2) and PD9A para 12.2). That evidence must not only address the matters in s22ZB(1)-(3) but must include a detailed estimate of the costs both incurred and to be incurred. If the application seeks a hearing sooner than 14 days from the date of issue of the application pursuant to FPR rule 18.8(4) then the written evidence in support must explain why it is fair and just that the time should be abridged.
Other orders for legal costs funding
Application of the principles to this case
"While there are no special rules for applications for orders for costs brought at the conclusion of Hague Convention proceedings (EC-L v DM [2005 2 FLR 772, there are special considerations why applications should not be entertained pending that conclusion: prospective applicants should not be deterred and discouraged from seeking return orders; such applicants are placed in a privileged position in having the automatic right to non-means tested non-merit based public funding; it would usually be difficult re-balance any costs payments made at the conclusion of the proceedings when findings will have been made; the summary nature of the proceedings could very well be jeopardised if the court had, first, to set up and then adjudicate upon applications for costs payments prior to any work even being commenced on behalf of a respondent; there would probably have to be extensive financial disclosure from applicant's living abroad which would be inimical to the purpose of the Hague Convention of seeking the swift return of abducted children."
"17. The case has accordingly come on for final hearing before me here, today, with one clear court day allowed. The father himself remains, as he is entitled to do under the convention, in Lithuania. But, he is very well represented by his non-means-tested, fully publicly funded lawyers. The mother appears in person. She speaks negligible English. An interpreter has been provided by the court at the expense of public funds. The adult daughter, who speaks much more fluent English, is kindly here to assist her mother, but does not need to be. The father's solicitors have also necessarily engaged their own Lithuanian interpreter, also at the expense of public funds, so that they can communicate from the court here with their client in Lithuania, who I infer speaks no English. The CAFCASS officer attended and I heard some very brief, but helpful oral evidence from him at the outset of the hearing this morning.
18. I wish to make crystal clear that I give no steer whatsoever as to the likely outcome of this case. On the one hand, this is a blatant case of wrongful retention after an agreed short holiday here. On the other hand, on the alleged facts as I have summarised them, there is clearly a properly arguable case, with at least a realistic prospect of success, that there is a grave risk that the return of the child forthwith to Lithuania would expose her to physical or psychological harm or otherwise place her in an intolerable situation; and, separately, that she does object to being returned (having identified 10 on the scale given to her) and that she has attained an age and degree of maturity at which it is appropriate to take account of her views. The mother is simply incapable of presenting and developing her case properly. She does not know the complex law. She has to communicate through the interpreter. The father has all the resources of state-funded lawyers. This is not equality of arms, as the fair trial provisions of Article 6 of the European Convention on Human Rights require. The father's own very experienced barrister in this field, Mr Nicholas O'Brien, said that he did not resist an adjournment "since there is a considerable risk of unfairness to the mother and the child if the case proceeds today".
The husband's appeal
"It is trite law and practice that financial applications ancillary to a divorce depend on the continuation of the petition. S22 states that the term of an order made under it shall be [for]
" such term, being a term beginning not earlier than the date of the presentation of the petition and ending with the date of the determination of the suit, as the court thinks reasonable".
So if a petition is dismissed, maintenance pending suit comes to an end (although any arrears remain: Moore v Moore  1 FLR 1413). If the petition is stayed, it follows in my view that any application for maintenance pending suit is stayed with it, as the latter has no independent life. This is a matter of substantive English family law / practice / procedure, not one of jurisdiction, nor of failing to accept jurisdiction."