MT v VA (Second Application: Legal Services Provision order)

On an application for a legal services payment order, the court must be satisfied that the applicant cannot reasonably obtain appropriate legal services without provision from the other party. This includes considering the availability of commercial funding, a charge over assets recovered in the proceedings, or a Sears Tooth arrangement.

The court must assess the parties’ present and prospective resources and needs, the issues in dispute, proportionality, and the effect of an order on the paying party’s ability to secure legal services. It may adopt a robust view of likely third-party financial support where the evidence shows a history of such support and the position remains unclear. A limited order beyond an FDR hearing may be justified where focused advice is likely to narrow issues and promote settlement.

The applicant, H, sought a second order under section 22 ZA of the Matrimonial Causes Act 1973 requiring his former wife, W, to fund legal services in ongoing financial remedy proceedings.

His first legal services payment order had been made in March 2019. The proceedings had since become extensive, the anticipated FDR had taken place, and a final hearing had been listed. Developments in related international arbitration had reduced the immediate prospect of recovery from a potential litigation asset but had not eliminated it.

The central issues were whether H reasonably required further legal services, whether alternative funding was available, and whether W had sufficient resources, directly or through likely family support, to meet a further order without undue hardship.

1. Application granted. W was ordered to pay £95,000 to H’s solicitors in two instalments: £58,000 towards historic costs and £37,000 for ongoing legal advice, including advice on settlement and the next steps in the financial remedy proceedings.
2. Section 22 ZA required the court to consider whether, without the payment, H could reasonably obtain appropriate legal services. The inquiry was prospective and was not a surrogate inter partes costs jurisdiction. The court also had to be satisfied that commercial litigation funding was unavailable and that H’s solicitors would not proceed under a Sears Tooth arrangement.
3. The guidance in Rubin v Rubin [2014] EWHC 611 (Fam) was applied. Although funding generally should not extend beyond an FDR hearing, an award beyond that stage could be justified by good reason. Here, focused advice had the potential to narrow the issues and avoid a lengthy final hearing.
4. In applying section 22 ZB, the court considered the parties’ resources, needs, obligations and responsibilities; the complex subject matter and issues in dispute; representation; conduct; and the effect of an order on W. The recent arbitration award made immediate liquidity more remote but did not eliminate the possibility of future recovery.
5. The court was entitled to take a robust view of W’s ability to pay. Following TL v ML [2005] EWHC 2860 (Fam), where a party had historically been supported through a third party and that support was said to have been curtailed while the third party’s position remained ambiguous, the court could assume that support would continue at least until final trial.
6. H had no disposable income or security for a commercial loan, and his solicitor could not enter a Sears Tooth arrangement. W’s history of substantial family and third-party support meant that an order of £95,000 was proportionate and would not cause undue hardship or prevent her obtaining legal services.