KS v VS

Applications for a stay of divorce or financial remedy proceedings do not fall within the no-order costs regime for financial remedy proceedings. The court must instead apply the costs regime incorporated through FPR 28.2, exercising its discretion after considering all the circumstances, including party conduct and partial success.

Where the issues are sufficiently straightforward, summary assessment may be appropriate even though the hearing lasts more than one day. The civil guideline hourly rates are not strictly applicable in the Family Court, but may provide helpful guidance when assessing reasonable and proportionate costs in financial remedy litigation.

The applicant husband had succeeded on his application to stay divorce and financial remedy proceedings in England and Wales in favour of proceedings in Monaco. The court had found that Monaco was the forum with which the parties had the most real and substantial connection and that continuation there would not cause substantial injustice.

The issue of costs was adjourned. The husband sought recovery of costs exceeding £331,000 after amendment. The wife opposed any costs order, relying on the parties’ financial disparity, the husband’s conduct and her limited ability to pay. The court determined the applicable costs regime, whether summary assessment was appropriate, and the amount and timing of any costs order.

1. Applicable regime. An application for a stay of divorce or financial remedy proceedings is not a financial remedy proceeding for the purposes of FPR 28.3. The court therefore applied FPR 28.2 on a clean-sheet basis. Either party could seek, and be subject to, a costs order.
2. Relevant factors. Under the incorporated CPR provisions, the court had to consider all the circumstances, including conduct before and during proceedings, the reasonableness of raising or contesting issues, the manner in which the case was pursued, exaggeration and partial success. The husband’s delays, failures to comply with directions, late payments, adjournment application and pursuit of a fault-based divorce in Monaco increased costs. The wife’s arguments were weak and she had continued with proceedings which she lost.
3. Summary assessment. Summary assessment was appropriate. Although the hearing extended over more than one day, there was no absolute rule preventing summary assessment in a longer case. The judge had conducted the case throughout, the issues were straightforward and a detailed assessment would create further expense.
4. Guideline rates. The civil Guide to the Summary Assessment of Costs was not strictly applicable in the Family Court. Nevertheless, it provided useful support for a consistent, proportionate and predictable costs framework. A top guideline rate of £546 per hour was regarded, as a rough rule of thumb, as a proportionate amount recoverable from a losing party in the circumstances.
5. Order. A no-order decision was inappropriate despite the parties’ financial disparity. The husband’s conduct justified reducing his recoverable claim to 85 per cent, and a further broad-brush reduction of 30 per cent was made on standard assessment. The wife was ordered to pay £196,000, payable at the conclusion of the Monaco proceedings, including any appeal.

Not an appeal. The judgment concerned the adjourned costs issue following the court’s earlier decision granting the husband’s stay application.