Family lawyers know that poor litigation conduct can result in the Family Court imposing some form of adverse costs sanction under Family Procedure Rule 28.3(6). The case of OG v AG [2020] EWFC 52 shows, however, that an otherwise adverse costs award can be reduced if the opposing party does not negotiate reasonably.
The Court determined that although the Applicant had dishonestly sought to obscure his actual assets during the proceedings, he had, by 12 June 2020, disclosed all relevant assets, therefore the “financial landscape” had been clear to the Respondent by that date. As a result, although the Applicant’s conduct during the proceedings had been unjustified and warranted a costs award against him, the Respondent’s failure to negotiate in a reasonable manner from 12 June 2020 onwards justified her overall costs award being reduced.
The court emphasised the importance of paragraph 4.4 of the Family Procedure Rules Practice Direction 28A. At paragraphs [30]–[31] of the judgment, it stated:
“30. The revised para 4.4 of FPR PD28A is extremely important. It requires the parties to negotiate openly in a reasonable way. To take advantage of the husband’s delinquency to justify such an unequal division is not a reasonable way of conducting litigation. And so, the wife will herself suffer a penalty in costs for adopting such an unreasonable approach.
31. It is important that I enunciate this principle loud and clear: if, once the financial landscape is clear, you do not openly negotiate reasonably, then you will likely suffer a penalty in costs. This applies whether the case is big or small, or whether it is being decided by reference to needs or sharing.”
In summary, OG serves as a good reminder to family law solicitors and barristers of the importance of negotiating reasonably once the financial landscape is clear in financial remedy proceedings.
For advice and assistance regarding financial proceedings on Divorce, Child Arrangements Orders, or to arrange representation for a fact-finding hearing, contact our expert family law barristers. We are Milton Keynes and London-based family lawyers who can help with any aspect of family law disputes.