B v B

• Jurisdiction: Cayman Islands
• Judge: (Williams, J.)
• Judgment Date: 18 September 2012
• Court: Grand Court (Cayman Islands)
• Date: 18 September 2012

Grand Court, Family Division

(Williams, J.)

B

and

B

D.T. McGrath for the petitioner;

S.T. McCann for the respondent.

Cases cited:

(1) A v. A (Maintenance Pending Suit: Payment of Legal Fees), [2001] 1 W.L.R. 605; [2001] 1 FLR 377; [2001] 1 F.C.R. 226, considered.

(2) C v. C (Maintenance Pending Suit: Legal Costs), [2006] 2 FLR 1207, considered.

(3) CF v. KM (Financial Provision for Child: Costs of Legal Proceedings), [2011] 1 FLR 208; [2010] EWHC 1754 (Fam), referred to.

(4) Currey v. Currey, [2007] 2 Costs L.R. 227; [2007] 1 FLR 946; [2006] EWCA Civ 1338, applied.

(5) F v. F (Ancillary Relief: Substantial Assets), [1995] 2 FLR 45; [1996] 2 F.C.R. 397, referred to.

(6) G (Maintenance Pending Suit), Re, [2007] 1 FLR 1674; [2006] EWHC 1834 (Fam), considered.

(7) G v. G (Child Maintenance: Interim Costs Provision), [2010] 2 FLR 1264; [2009] EWHC 2080 (Fam), referred to.

(8) G v. G (Maintenance Pending Suit: Costs), [2003] 2 FLR 71; [2002] 3 F.C.R. 339; [2002] EWHC 306 (Fam), considered.

(9) KSO v. MJO, [2009] 1 FLR 1036; [2008] EWHC 3031 (Fam), dicta of Munby J. considered.

(10) L-K v. K (Brussels II Revised: Maintenance Pending Suit), [2006] 2 FLR 1113; [2006] EWHC 153 (Fam), considered.

(11) M v. M (Maintenance Pending Suit), [2002] 2 FLR 123; [2002] EWHC 317 (Fam), considered.

(12) M v. T, [2007] 2 FLR 925; [2006] EWHC 2494 (Fam), referred to.

(13) Moses-Taiga v. Taiga, [2006] 1 FLR 1074; [2008] 1 F.C.R. 696; [2005] EWCA Civ 1013, considered.

(14) S (A Child) (Financial Provision), In re, [2005] Fam. 316; [2005] 2 W.L.R. 895; [2005] 2 FLR 94; [2004] EWCA Civ 1685, referred to.

(15) Sears Tooth v. Payne Hicks Beach, [1997] 2 FLR 116; [1998] 1 F.C.R. 231, dicta of Wilson J. considered.

(16) TL v. ML (Ancillary Relief: Claim Against Assets of Extended Family), [2006] 1 FLR 1263; [2006] 1 F.C.R. 465; [2005] EWHC 2860 (Fam), considered.

(17) Thomas v. Thomas, [1995] 2 FLR 668; [1996] 2 F.C.R. 544, considered.

(18) W v. J (Child: Variation of Financial Provision), [2004] 2 FLR 300; [2003] EWHC 2657 (Fam), considered.

(19) Wicks v. Wicks, [1999] Fam. 65; [1998] 3 W.L.R. 277; [1998] 1 All E.R. 977; [1998] 1 FLR 470; [1998] 1 F.C.R. 465, referred to.

(20) Zuiderent v. Zuiderent, 2001 CILR N[9], applied.

Legislation construed:

Legal Aid Rules 1997, r.12(6):

‘If, upon conclusion of the proceedings, the assisted person succeeds in obtaining-

(a) an order for ancillary relief . . . or

(b) a declaration . . . as to the beneficial ownership of any property; or

(c) a money judgement; or

(d) an order for the recovery of any land or other property,

the Court may order the assisted person to pay a contribution . . . towards the cost of his representation and such contribution shall constitute a debt payable to the Government.’

Matrimonial Causes Law (2005 Revision), s.20(c):

‘The Court may make orders pending the outcome of any suit in respect of which a petition has been presented providing for-

. . .

(c) periodic payments to be made by one party to another pending suit . . .’

Family Law-financial provision-maintenance pending suit-legal expenses-court may order costs allowance under Matrimonial Causes Law (2005 Revision), s20(c)-not costs order per se as applicant required to apply towards costs and repay at trial if so ordered-applicant to show insufficient assets and inability to procure legal services by Sears Tooth charge or legal aid-court to balance fairness to respondent, means and reasonableness of position of both parties, ongoing costs liabilities owed by the applicant and if issues in litigation proportionate to costs-when evaluating respondent”s means, court may consider habitual bounties from respondent”s family-good practice to provide detailed costs estimate to allow assessment of reasonable figure but failure to do so not fatal to application

The petitioner, Mrs. B, brought divorce proceedings in the Grand Court.

Mrs. B, an American national, married a Caymanian in 2008 and had two children. After the separation of their parents, the children continued to live with Mrs. B in the former matrimonial home and maintained regular access to their father. The parties were of limited means, with Mrs. B financially dependent on payments of maintenance pending suit from Mr. B.

Her attorneys were unwilling to enter into a Sears Tooth charge payment arrangement in respect of the ongoing legal proceedings, including her proposed application to remove the children permanently to Florida and for final ancillary relief. Consequently, she sought an order,

pursuant to the Matrimonial Causes Law (2005 Revision), s.20(c), requiring Mr. B to contribute to her legal fees. The Grand Court (Williams, J.) was satisfied that the court had jurisdiction to make such an order and that the required criteria were met and so ordered a costs allowance of 75% of the sum applied for, to reflect the court”s concern about the limited breakdown of the costs provided (noted at 2012 (1) CILR N [4]).

When the projected costs allowance proved to be too low, the Grand Court granted Mrs. B a civil legal aid certificate for her proposed applications, which was conditional upon there being a cap of CI$3,500 and included clawback provisions. Mrs. B filed multiple requests to remove the condition setting the cap, as her attorneys would not accept the certificate on such terms, but these were refused by the court, and, in keeping with her attorneys” position, the court issued a discharge certificate.

At the date of trial, Mrs. B”s unpaid legal fees were CI$98,960 and her husband”s were at a similar level. Mr. B”s representation at the forthcoming removal application was to be financed by his mother and he was CI$32,348 in arrears in respect of his payments of maintenance pending suit. The court was not provided with a proper breakdown of either party”s fees. Mrs. B sought an order for additional maintenance pending suit to reflect accrued and ongoing legal costs of CI$120,000.

Mrs. B submitted that (i) the court should ensure that there was equality of arms for her in the pending litigation; (ii) there was no source from which she could raise the funds to pay for her own legal representation; (iii) Mr. B could liquidate his assets (including personal assets) or borrow so as to be able to provide the funds; and (iv) a loan could be provided by members of his family. This meant that the order sought was just and should be made, or, if it were not to be made, the court should grant legal aid.

Mr. B submitted in reply that (i) Mrs. B had not demonstrated an inability to raise the funds to meet her legal fees and that she should have tried to find new attorneys willing to accept a Sears Tooth arrangement; (ii) she had adopted a wholly unreasonable stance in relation to the pending proceedings; (iii) he did not have access to sufficient funds to meet the order sought-in particular, in the light of his financial position, it was unrealistic to expect any lending institution to grant him a loan secured against his personal properties; and (iv) the parties” vehicle, used by Mrs. B, but registered in his name, should be sold and she could buy a smaller vehicle from the proceeds and use the remaining balance towards her legal fees.

Held, dismissing the application:

(1) The court had jurisdiction to make the order sought under the Matrimonial Causes Law (2005 Revision), s.20(c). Although this did not give it the power to make an interim lump sum order, it could order maintenance pending suit which included an element which would enable the payee to pay legal fees. This costs allowance was not an order for costs

per se, and the court would require an applicant to use it only for the payment of costs and to repay any amount directed by the court when it came to consider costs. The court pointed out that when the Children Law 2003, Schedule 1 came into force, it would be possible to order lump sums at any time in proceedings for the benefit of the child, which arguably covered applications for costs allowances in respect of proceedings relating to children, although this could not apply to the present applications (para. 24; para. 36; paras. 52–55).

(2) When determining costs allowances, the overarching enquiry should be whether the applicant could reasonably obtain legal advice by any other means. An applicant would need to demonstrate that (i) he had no assets which could reasonably be deployed, either directly or by raising a loan, to fund legal services; (ii) he could not reasonably procure legal services by the offer of a Sears Tooth charge upon the ultimate capital recovery; and (iii) no legal aid was available to enable him to obtain representation at a level of expertise required for the complexity and nature of the proceedings. The court also retained discretion to refuse an application that met these criteria, depending on the subject-matter of the proceedings, the reasonableness of the applicant”s stance and any ongoing liability as to costs owed by the applicant to the other party (paras. 45–48).

(3) Mrs. B could not reasonably procure legal representation by her own means. Her attorneys were reasonably unwilling to enter into a Sears Tooth charge and it would have been unfair to expect her to attempt to find a new attorney. Further, the court was satisfied that a litigation loan could not be raised-although the provision of letters from banks confirming their refusal to lend money might be required in other cases. Moreover, she could not obtain sufficient public funding to obtain proper representation, as it was reasonable for her attorneys to refuse to be retained pursuant to the existing legal aid certificate and the court would not vary the conditions. There was an established procedure relating to referrals of legal aid applications to the Chief Justice (or another designated judge), and he had already ruled on Mrs. B”s legal aid application in this...