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19 November 2014

High Court judge calls for fixed pricing for financial settlements on divorce

Mr Justice Mostyn, in his judgment on a case where the parties’ legal costs ran to £920,000, has said that people must be able to demand a fixed price for each of the phases of a financial remedy case (i.e. coming to a financial settlement on divorce).

Whilst saying in his judgment (read it in full in on Family Law Hub) that "perhaps the culture is just too ingrained to be reformed", Mr Justice Mostyn suggested that the first thing to do is to insist on fixed pricing for cases. He deplored the fact that this was first suggested two and half years ago and nothing has happened such that "these wasteful and inefficient practices persist".

As Family Law Week report in their summary of Mr Justice Mostyn's judgment:

  • He opines that a litigant must be able to demand a fixed price for each of the three phases of an ancillary relief case namely: (1) Form A to First Appointment, (2) First Appointment to FDR, and (3) FDR to trial.
  • The second measure advocated is for the court to be able to impose at the very beginning of the case a costs cap on what may be charged by the lawyers to their client for each of the three phases of the case. Naturally this cap would be variable if circumstances changed but the change of circumstances would have to be a big one for a variation to be allowed.
  • He said that only if these two measures were adopted would "the grotesque leaching of costs, such as has occurred in this case, be arrested".
  • He expressed the view that fixed pricing might have the beneficial consequence of reducing the present volume of self-representation, and that it by no means followed that fixed pricing would lead to a reduction in revenue for lawyers. 

Of course Intelligent Divorce has been ahead of the game in offering a fixed-cost service for financial settlements for a while - charging just £599 (+VAT) for the solo service and £499 (+VAT) each for the co-operative service