KSO v MJO & Ors

In ancillary relief proceedings, a third party should not be joined merely to investigate whether a claim might exist or to obtain a fuller picture. Joinder requires a question or issue between that person and a party to the proceedings. Where a claim against a joined third party is abandoned, costs will ordinarily follow the event if the claim was always weak and unlikely to succeed. The court may order the claimant to pay the third party’s costs and may require the other spouse to bear part of that liability where inadequate disclosure materially contributed to the joinder. The judgment also stresses the need for proportionate costs and properly pleaded claims at an early stage.

These were ancillary relief proceedings arising from a divorce petition. The wife sought financial relief from the husband and investigated transactions involving the husband’s father, who was joined as a respondent, and the husband’s mother, who intervened in relation to a claimed loan secured on the former matrimonial home.

Before the hearing, the wife abandoned her substantive claim concerning the father. The mother’s claim was compromised by consent. The court therefore had to determine the appropriate orders concerning joinder, the father’s costs, the husband’s appeal and related procedural matters, including whether the father had properly been brought into the proceedings.

1. Joinder. The wife’s case was that the husband had a beneficial interest in property ventures nominally conducted by his father. RSC Order 15 rule 6(2)(b) could provide a proper procedural route for joinder where joinder was otherwise appropriate. However, the rule did not permit a person to be joined merely as a potential witness, source of disclosure, or means of finding out whether a claim existed. It required a question or issue between that person and a party to the proceedings.
2. Pleading and case management. The wife should have been required to formulate and plead her case against the father. Pleading provides intellectual discipline, exposes weaknesses at an early stage and may prevent ruinous costs. This was not a demand for technical formality, but for sensible and proportionate clarification of the case.
3. Costs of the father’s involvement. The wife had pursued a claim which was fraught with difficulty, had little prospect of success and was eventually abandoned. This was not a case in which a meritorious claim had merely become academic, nor one in which the merits were too difficult to assess. Costs should therefore follow the event. The father was entitled to recover his costs from the wife, including costs connected with complying with the inspection and disclosure orders.
4. Allocation between the spouses. The husband’s inadequate responses to the wife’s questionnaire had contributed to her suspicions, but by the time she sought joinder she possessed the relevant documents and could assess the weakness of her case. Responsibility was therefore shared. The husband was ordered to pay the wife one-half of the costs which she was ordered to pay the father.
5. Other orders. The mother’s claim was compromised at £52,500, secured by a charge over the former matrimonial home, with no order as to costs. The father’s appeal and injunction application were dismissed, with his costs of those matters payable by the wife and assessed if not agreed. The proceedings subsequently collapsed following the husband’s bankruptcy.

The judgment records an appeal by the father from orders made by the District Judge, which had been heard before Holman J and adjourned for determination with related applications. The father’s appeal and injunction application were dismissed by this court. The judgment also records a separate appeal by the husband concerning maintenance, but does not state that it was finally determined.