MB v CD

An order for payment of legal services costs may be made only where the applicant cannot reasonably obtain appropriate legal services without it. The applicant must also show that a litigation loan is unavailable and that funding by charging assets cannot reasonably be obtained. A property may nevertheless be treated as a realisable asset where it is the applicant’s secure home; that protection is less compelling where the applicant’s existing accommodation is insecure. The court may fund both historic and future costs, but must assess what is reasonably required rather than simply allow the sums claimed.

The applicant sought legal services payment orders under the Matrimonial Causes Act 1973 for financial proceedings and related Children Act proceedings. The parties were divorced and had a teenage child with significant special needs. The applicant sought funding for enforcement and variation proceedings, child-arrangements proceedings, historic costs and future costs.

The central issues were whether the applicant could reasonably obtain appropriate legal services without an order, whether she could raise funds by borrowing or charging assets, whether her owned property should be treated as her home, and what level of funding was reasonably required.

1. Statutory test. The application was governed by s22 ZA of the Matrimonial Causes Act 1973. The applicant had to establish that, without payment, she would not reasonably be able to obtain appropriate legal services for the proceedings or part of them. She also had to show that she could not reasonably secure a loan or obtain funding by granting a charge over assets.
2. Assets and accommodation. The applicant had no realistic litigation loan and no available Sears Tooth arrangement. Although she owned a property with substantial value, her accommodation with the child was owned by the respondent and was subject to conditions which made her long-term, and possibly medium-term, occupation insecure. In those circumstances, requiring her to sell her property to fund litigation was speculative and unreasonable at that stage.
3. Scope of the application. The judge determined funding for both the financial and Children Act proceedings. Both applications had been listed before her, she had reviewed the relevant bundles, and the proceedings were complex. It was unnecessary to defer the Children Act funding issue to the judge who would later hear those proceedings.
4. Quantum and orders. Historic and future costs were assessed separately and reduced to sums reasonably required. The order totalled £60,000 for the financial proceedings and £140,000 for the Children Act proceedings. The sums for historic costs and the first future instalment were payable within 14 days, with later instalments due by the end of April and May. Further funding could be sought if the proceedings did not settle at the DRA. The respondent was ordered to pay £15,000 towards the costs of the application.