England and Wales High Court (Family Division) Decisions

IN THE HIGH COURT OF JUSTICE
FAMILY DIVISION
IN AN APPLICATION UNDER SCHEDULE 1 CHILDREN ACT 1989

		The Civil Justice Centre 1 Bridge Street Manchester M60 9DJ
		25/07/2016

HIS HONOUR JUDGE BOOTH :

1. I am dealing with the costs of contested Schedule 1 Children Act proceedings that resulted in an order against the father following a claim being brought by the mother on A's behalf. The broad picture is that the mother has no assets and no income save for some state benefits and what she receives from the father. She and A live in rented accommodation paid for by the father. The father is a professional footballer whose success has come late in his career and who enjoyed an outstanding season in 2015/2016, after these proceedings were started.
2. The issue at the heart of the costs question is whether the father should have to pay the mother's costs beyond what he has already paid following orders being made against him as the case has progressed including post the FDR.
3. Miss Hillas on behalf of the mother and Mr Calhaem on behalf of the father have helpfully provided me with submissions in writing on this issue and on costs generally. I have taken into account everything they have submitted. Miss Hillas has also referred me to a recent decision considering interim costs provision^[1]. I have read it. It does not help me at all.

The law

4. The applicable principles appear to me to be as follows

a. Costs in family proceedings are governed by the Family Procedure Rules Part 28 and PD28A;

b. Although rule 28.3 establishes the principle of no order for costs, PD28A paragraph 4.2(b)(i) provides that Schedule 1 proceedings are excepted from the general rule;

c. Applying the reasoning in Judge v Judge [2008] EWCA Civ 1458 and Baker v Rowe [2009] EWCA Civ 1162 the correct starting point is a clean sheet of paper;

d. Factors to direct the reasoning on the clean sheet of paper include,

i. Per Wilson LJ in Judge: the days are gone when judges of the Family Division would not uncommonly order a wealthy party to pay the costs of an impoverished party irrespective of outcome;

ii. The correct starting point may well ordinarily be that costs follow the event;

iii. In bringing the claim under Schedule 1 the mother was in effect acting in a representative capacity for the child;

iv. Even a representative is not immune from the consequences of litigating unreasonably;

v. Lawyers are not a charity;

vi. The welfare of the child is the court's paramount consideration in administering the child's property – section 1(1)(a) Children Act. Any reduction of the sums awarded for the benefit of the child to pay towards litigation costs would absence something exceptional be impermissible;

vii. Any consequences that led to the financial impoverishment of the child's primary carer would be unlikely to be in the best interests of the child;

viii. All parties, representative or otherwise, are obliged to help the court further the overriding objective of enabling the court to deal with cases justly, having regard to any welfare issues involved and which includes ensuring the parties are on an equal footing and saving expense;

e. Civil Procedure Rules 1998 Part 44.2 provides a useful checklist of generically relevant matters for the court to consider when exercising discretion on the basis of a clean sheet of paper;

f. The judicial determination as to costs is likely to be fact specific in each case.

The litigation

5. Both the mother and the father had made open offers to settle the claim. Neither succeeded in obtaining what they proposed. Neither party made a Calderbank proposal that I could legitimately be referred to. Mr Calhaem attached to his submissions a letter marked "Without Prejudice" but making no reference to costs and/or Calderbank. It set out what the parties had very nearly agreed at the Financial Dispute Resolution hearing. I should not have been shown that letter and I have ignored its contents.
6. There can be no doubt but that the mother pitched her case beyond what was realistic. There can be no doubt that the father pitched his case below what was realistic. As the mother succeeded in achieving an award that was not available to her without pursuing the case to trial the starting point must be that she is entitled to her costs.
7. The next question is whether she ran a case that was so far beyond what she achieved that she should be penalised and made to pay her own costs from assets that she does not have. It is rare that a party in these sorts of cases succeeds in full in getting everything they ask for. Both parties here chose the ground on which to fight. The mother obtained a capital award for a home for her and A very significantly beyond what the father was prepared to volunteer. In the witness box, i.e. after all the costs had been incurred, the father made sensible concessions that he could have made in writing before the case started. The father succeeded in limiting the award of periodical payments for the support of the mother. Although as I said in my judgment I found that the most difficult aspect of the case, the award was still higher than the father's proposal, not least his initial position that I should make no award at all as I lacked jurisdiction to order anything, a point that was withdrawn during the hearing.
8. The next question is whether the mother was given a "costs budget", a practice available in civil proceedings but no part yet of family proceedings. Earlier orders provided the mother with a costs allowance, the court exercising inherent jurisdiction absent a statutory provision equivalent to section 22ZA Matrimonial Causes Act 1973. It is Mr Calhaem's submission that the mother having been provided with a sum towards her costs expressed to cover the period up to and including a final hearing that that provided an upper limit so that she should have ensured that her liability to her solicitors fell within that sum such that she knew any expenditure beyond that sum was at her own expense.
9. Whilst the argument was attractively presented it is without merit. "Costs budgeting" has no place in family proceedings. The sums awarded were not expressed to be a limit. The court order did not say so. No point was even made in correspondence shown to me to warn the mother of this argument before she incurred the costs that she has. The recovery of costs incurred beyond the amount paid by way of costs allowance is a matter for assessment. In any event, as I have explained above, the court has an absolute discretion as to costs when starting with a clean sheet of paper.

Exercise of discretion

10. I start with a clean sheet of paper. The mother succeeded in achieving an award for A that was not available to her without the need to litigate to a conclusion. The mother acted at all times in a representative capacity and has no resources of her own. It would be grossly unfair for her solicitors to be responsible for her costs, subject only to the process of assessment by a costs judge to protect the paying party's interests. The father's proposal that the mother should be left at risk of bankruptcy at the hands of her own solicitors was not a proposal that paid any regard to the welfare of A. Looking at the checklist in CPR 44.2(4): both parties can be criticised for overstating their respective cases, the mother succeeded even if she was not wholly successful and the father did not make an offer to settle in terms that might have been relevant.
11. In this case the father should pay the mother's costs subject to assessment and should receive credit for the amounts already paid in respect of costs pursuant to the earlier orders I have referred to. Once the liability has been assessed, then if the father wishes to argue that he should have time to pay he will need to make an application to that effect that should be directed to me for determination.

Note 1   BC v DE [2016] EWHC 1806 (Fam) Cobb J    [Back]