Managing Partner Katie McCann examines the case for financial remedies reform to a rules-based system in The Times.
Katie’s article was published in The Times, 13 July 2023, and can be read here.
Mr Justice Mostyn’s latest call for a ‘rules-based system’ to determine financial remedies on divorce would seem, on the surface, to be a sensible solution to the ever-present problem of disproportionate costs being spent by parties. Speaking at a meeting in Parliament, Mostyn described his previous attempts to set out simple rules on the subject as having been ‘overpainted by woolly discretion in the Court of Appeal’, decrying the present system for not being capable of ever being ‘predictable, transparent, economical or consistent’.
Mostyn has been championing the cause of a rules-based system since at least 2014, when he called a divorcing couple’s spending a third of their combined wealth on legal costs as a “grotesque leaching of costs” brought about by “wasteful and inefficient practices” by their lawyers. Having himself been prolific in his career at the High Court bench for applying a formulaic and precise approach to cases, Mostyn is keen for his peers to be forced to follow suit.
However, many in the family law world do not agree with his approach, as there are times when having prescriptive rules in place to determine certain issues can result in unfairness being done to one of the parties. The quest for achieving fairness has always been the holy grail for all family lawyers and family courts, yet however we look at a particular case or circumstance, the quest to achieve fairness means an element of discretion will always need to be present to ensure that a party’s need does not fall foul of an arbitrary approach.
Perhaps the trickiest area for prescription is spousal maintenance. There have been calls to limit the number of years a divorced spouse can receive spousal maintenance from their ex-partner, as in the pre-covid private member’s bills of Baroness Deech. However if an arbitrary cut off point was imposed in every case, it could lead to circumstances where one party to the marriage was left in financial difficulties.
The absolute requirement for fairness in all cases is the reason that Mostyn has faced such stiff opposition to his crusade down the years, and is – and will continue to be – always the argument against the reforms he proposes. At the same time, it cannot be ignored that the level of costs in some “middle money” cases are definitely not proportionate. That is because, as Mostyn says, there is too much scope for argument.
As such, enacting into law some simple principles would assist in the majority of cases.
But there is no getting away from the fact that discretion should still be present and permitted when required to achieve fairness to both parties. With the Law Commission currently reviewing the laws governing the finances of divorce, a tightening up of some principles to limit costs and widen access to justice, with the safety net of discretion securely in place, would seem to be the optimum way forward.
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