CF v KM

Where a child-support calculation prevents an order for periodical payments, it does not necessarily prevent a lump-sum order under Schedule 1 to the Children Act 1989. The court may make such an order during existing proceedings, or dispose of a lump-sum claim while leaving other relief for later determination, provided the payment is for the benefit of the child.

This jurisdiction may fund legal costs in Schedule 1 proceedings and, where appropriate, costs in proceedings under section 8 of the Act. The jurisdiction is distinct from the ordinary costs jurisdiction and must be exercised carefully and sparingly. Relevant considerations include the paying parent’s wider financial resources, the likely prospects of a substantive award, fairness, and the realistic prospect of recoupment.

The mother appealed against the dismissal of her application for a lump-sum payment under Schedule 1 to the Children Act 1989. She sought funding for her Schedule 1 financial-provision claim and for related section 8 proceedings concerning the child’s education and living arrangements.

The District Judge held that there was no jurisdiction to make the order because a child-support assessment was already in force and was below the maximum. The central issue before the High Court was whether the court could make a lump-sum order for the child’s benefit while the proceedings continued, notwithstanding the restrictions on periodical payments under section 8 of the Child Support Act 1991.

1. Jurisdiction. The appeal was allowed in substance. The court had jurisdiction to make a lump-sum order under Schedule 1 notwithstanding the existing child-support assessment. Paragraph 9 concerns interim orders made before disposal of the application. Paragraph 1 also permits a lump-sum claim to be disposed of, or revisited, while other aspects of the claim remain outstanding.
2. The statutory purpose is that the payment must be for the benefit of the child. That test applies both to orders made at the substantive hearing and to orders made during proceedings. Funding a parent’s legal costs may satisfy the test where representation is likely to ensure that the court is properly informed about the child’s welfare and financial circumstances.
3. The same reasoning applied to the section 8 proceedings. Their investigatory nature, the paramountcy of the child’s welfare, and the importance of equality of arms meant that funding the mother’s representation could benefit the child. The issue went to the exercise of the discretion, rather than the existence of jurisdiction.
4. The court rejected the argument that a lump-sum order would improperly circumvent the Child Support Act 1991. The order could be based on capital and other financial resources outside the income used for the child-support calculation. A costs order was not expenditure of the type addressed by the maintenance calculation.
5. The discretion had to be exercised cautiously. Relevant considerations included fairness to the paying parent, the risk that costs could not be recouped, the prospects of a substantial Schedule 1 award, the reasonableness of the claim, the parties’ financial disclosure, and whether the order would materially undermine the benefit ultimately secured for the child.
6. The court therefore ordered a lump sum of £20,000, inclusive of VAT, for future costs of the section 8 hearing, the FDR and initial consequential work. Past costs were excluded because of evidential gaps concerning their funding and the parties’ financial positions. The proposed payment was to be made to the mother’s solicitors, subject to an undertaking that it would be used only for those costs.

The judgment was an appeal from the dismissal by District Judge Aitken of the mother’s application for a costs allowance under Schedule 1 to the Children Act 1989. The High Court reconsidered the jurisdictional issue and made a limited lump-sum order.