Currey v Currey

A maintenance or periodical-payments order may include an allowance for legal costs. The applicant must first show that legal advice and representation cannot reasonably be obtained by any other means. This requires consideration of available assets, secured or unsecured borrowing, a charge over any eventual capital recovery, and suitable public funding.

This necessity is not invariably sufficient. The court retains a discretion which includes the subject matter of the proceedings, the reasonableness of the applicant’s position and other relevant conduct or liabilities. The case need not satisfy a separate test of being “exceptional”. Any allowance should be fixed with realism and caution as to amount and duration. An allowance extending only to a financial dispute resolution appointment may provide a proper opportunity for review.

The wife appealed against an interim variation of a periodical-payments order requiring her to provide the husband with £40,000 for legal advice and representation in continuing ancillary-relief proceedings. Those proceedings concerned her application to capitalise and discharge his periodical payments and his cross-application for an increase.

The High Court judge found that the husband could not fund his representation directly or through borrowing. He made the allowance notwithstanding the husband’s previous unreasonable litigation, costs liabilities and civil restraint order. The allowance extended only to the end of the financial dispute resolution appointment.

The central issue was whether the judge had misunderstood the legal conditions for a costs allowance or had wrongly concluded that the husband could not reasonably obtain representation through his own resources, particularly his interest in a £640,000 housing fund.

1. Permission to appeal was granted, but the appeal was dismissed. Wilson LJ delivered the leading judgment. Lindsay J agreed, and Chadwick LJ agreed after resolving his initial concern about the husband’s housing fund.

2. Sections 22 and 31 of the Matrimonial Causes Act 1973 permit a maintenance or periodical-payments order to include an allowance for legal costs. The controlling inquiry is whether the applicant can show that legal advice and representation cannot reasonably be procured by any other means. Available assets must be considered, but the applicant need not deploy them or use them as security where doing so would be unreasonable. The court must also consider borrowing, a charge over any eventual capital recovery and the availability of public funding providing expertise suitable for the proceedings.

3. The description of the jurisdiction as “exceptional” did not create an additional threshold. The inability reasonably to obtain representation elsewhere is a necessary condition, but it is not always sufficient. The court retains a discretion informed by the subject matter, the reasonableness of the applicant’s position and other relevant matters, including litigation conduct and existing costs liabilities.

4. The High Court judge had asked the correct central question and had weighed the husband’s adverse conduct. He was entitled to conclude that neither immediate recourse to the housing fund nor the earlier deployment of £100,000 to reduce secured debt offered a realistic solution to the immediate need for representation. It was especially relevant that the husband principally needed to defend the wealthier spouse’s application for a clean-break order.

5. A costs allowance should be set with a judicious mixture of realism and caution as to amount and duration. Limiting this allowance to the financial dispute resolution appointment was appropriate. That appointment was a suitable watershed at which the need for any further allowance could be reassessed.

6. Under rule 2.61E of the Family Proceedings Rules 1991, the judge who conducts an unsuccessful financial dispute resolution appointment must have no further substantive involvement. Any later application to vary maintenance by extending a costs allowance must therefore be heard by another judge.

7. A costs allowance within a maintenance order is not an order for costs. The general rule subsequently introduced by rule 2.71(4)(a) would therefore not prohibit such an allowance. The court could later secure reimbursement, if appropriate, by deductions from capital or periodical payments otherwise payable to the recipient.

• Court of Appeal (Civil Division): Granted permission to appeal but dismissed the wife’s appeal, upholding the interim costs allowance: [2006] EWCA Civ 1338.
• High Court, Family Division: H.H. Judge Wilcox, sitting as a deputy High Court judge, ordered an interim increase of £10,000 per month for four months to fund the husband’s legal representation through the financial dispute resolution appointment. No citation is stated.
• Earlier proceedings: A previous appeal concerning the substantive capital provision was determined in Currey v Currey [2004] EWCA Civ 1799, [2005] 1 FLR 952. The current proceedings arose from later cross-applications concerning capitalisation and variation of periodical payments.