The risk of a costs order in family law cases is something that many clients are often concerned about and will seek reassurance upon. In reality our legal system operates against a starting point that there should be no order for costs in family proceedings. This starting point is rebuttable however and potential changes being explored by the Ministry of Justice could turn this on its head.
There is for example a great deal of debate at present about whether Calderbank (without prejudice) offers should be reintroduced in family law cases and taken into account when the court is considering whether an adverse costs order should be made. If this happened, it would represent a sea change in judicial approach and mark a far cry from the principle of "no order", which is currently applied in the majority of family law proceedings. It is a tough call however and the recommendations of the Ministry of Justice have not gone unnoticed.
In response to the consultation, the Law Society have supported an overhaul to the rules but it is clear there is little consensus and the issue has certainly generated unease amongst professional bodies representing the family law community.
The key message for parties in financial remedy proceedings is to be aware that exposure to an adverse costs order could be a live issue and to be clear about the circumstances when this might arise. Against a background of uncertainty, change is on the horizon in this area and there is a need to remain vigilant to ensure parties in family proceedings are properly protected against exposure to costs orders, particularly if the rules are revised.
Watch this space...
Concerns raised about Calderbank offers being used to assess litigation conduct in family proceedings.