Mr Justice Jackson has set out his views about litigation which has got out of control in a Court of Protection case – A & B [2014] EWCOP involving two claims which highlight the problem of delay and expense. Apparently each case cost £9,000 per month. He commented about the stress caused by the litigation which had caused “human misery” and said that “just as the meter in a taxi keeps running even when not much is happening, so there is a direct correlation between delay and expense.” He criticised the expense which mostly fell on the state in these cases and said that the duty to ensure that the costs are reasonable bites particularly sharply when deciding that an incapacitated person’s money should be spent on deciding their future. The judge commented that another cause of delay is the search for a perfect solution when a decent but imperfect solution can be rejected. The judge considered that the main responsibility for the situation and the solution lies with the Court which has the power to control the proceedings. The judge did not mention mediation as a solution, but encouraging the parties to use an ADR procedure does form part of the Court’s active case management powers listed by the judge. We understand that there is a mediation pilot under way in the Court of Protection, so it is not clear why this was not mentioned.
Family disputes are always ripe for mediation, but sadly the reduction in legal aid has reportedly led to a reduction in mediation in family cases. In a recent case, J v J [2014] EWHC 3654 (Fam) it has been reported that a couple ran up “grotesque” legal bills of £920,000 while fighting over assets worth less than £2.9million, amounting to nearly a third of the family assets they spent 18 years building up. Mr Justice Mostyn said the couple’s dispute over who should get what following a separation was ‘easily settleable’ and he was ‘almost lost for words’ at the scale of the ‘madness’.
Mr Justice Mostyn presided over a seven-day trial where the ‘principal focus’ had been a ‘bitter war of recrimination and denunciation about who was more at fault for this appalling state of affairs’. The two parties were represented by DWF LLP and Merrick Solicitors. The judge said the £920,000 spent on costs had reduced the couple’s total assets to a little under £2million. He concluded that the woman should get assets worth just over £1million and the man just under £900,000 worth of assets. He said they had married in the 1990s and separated in 2011. ‘I must confess to have been almost lost for words when the scale of this madness was revealed to me,’ said Mr Justice Mostyn. ‘They have spent a total of £920,000 in costs. Of this they have spent … £154,000 on forensic accountants valuing the husband’s business interests. ‘They have spent on costs nearly a third of everything they built up over 18 years.’ The judge added: ‘The result has been to make a case that was surely so easily settleable almost impossible to compromise.’ He said he had presided over a seven-day trial where the ‘principal focus’ had been a ‘bitter war of recrimination and denunciation about who was more at fault for this appalling state of affairs’. ‘These figures speak for themselves.’ He added: ‘Such a result should not be allowed to happen again.”
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By the time of a financial dispute resolution meeting in April 2014, the parties had already spent £226,000 on costs. This was largely due to a judge deciding in November 2012 to allow each party to appoint their own expert to value the husband’s business interests: in the event forensic accountants filed six expert reports and a joint statement, charging £154,000 in fees. In the eight months since April, a further £700,000 was spent on costs – a figure Mostyn described as ‘staggering’. The result, he added, has been to make a case that was ‘surely so easily settleable almost impossible to compromise’, and to impose on the High Court a seven-day trial. Of 18 pages of final submissions from one party, nine were devoted to costs. ‘The time has come when the law-makers in this country, whether they are legislators or judges, must stop saying something must be done and actually do something,’ said Mostyn. He said new rules must come into force to impose a costs cap on fees charged by lawyers and set fixed fees for each stage of litigation. The judge added: ‘In my opinion only if these two steps are taken will the grotesque leeching of costs, such as has occurred in this case, be arrested.’ Mostyn also noted that tougher rules may see more people opt to employ a lawyer rather than be self-represented as they seek expert advice on how much their case will cost. He intends to bring this judgment to the attention of the president of the Family Division with a view to him raising this pressing matter ‘as a matter of urgency’ with the Family Procedure Rules Committee. In the event, Mostyn ordered that the wife receive £1,123,500 of the assets and the husband £841,500. Lawyers and experts received £920,000 in total – almost 32% of the assets. also, in V v V [2011] EWHC 1190 (Fam) Judge Peter Jackson described £950,000 costs incurred by a couple who had not started financial proceedings as “absurd” This must surely be a case which is an abject lesson in why cases should be mediated rather than litigated. |