What if I cannot afford to pay my Family Law legal fees – Legal Services Payment Orders

After the withdrawal of public funding for most family matters, some parties may struggle to afford the legal fees involved in court proceedings.  A legal services payment order (LSPO) can be used to order one party to make payment to the other to fund their legal representation.

LSPOs can be made under sections 22ZA and 22ZB Matrimonial Causes Act 1973.  The power to make such an order was introduced in April 2013.  These can be used to assist with the cost of obtaining legal advice, representation and any other form of dispute resolution such as mediation.  It is unlikely however that it would be proportionate to make such an application if parties are only attending mediation and court hearings are not involved.

When can a LSPO be used?
These orders can be made in the following proceedings:

• Divorce
• Nullity
• Financial remedy proceedings
• Judicial separation

Similar provision has been made in children proceedings whether for disputes over child arrangements or for applications for financial claims on behalf of children of unmarried couples. However, the authority to apply for costs in children cases can be found in case law rather than through statute.

Most notably in the recent case of Re Z (Schedule 1: Legal Costs Funding Order; Interim Financial Provision) the mother began proceedings and sought a legal costs funding order in relation to Schedule 1 and section 8 of the Children Act 1989 proceedings relating to a lives with order which she sought in respect of her daughter and also for financial provision.  The mother was seeking payment of both historic costs that she was unable to pay and future costs of the litigation.  Costs were awarded to the mother in respect of both her historic and current legal costs to enable her to continue to access appropriate legal representation.

What type of payments can be made?

The payment does not need to be a large one-off payment.  The paying party may be ordered to pay in instalments or make payments for a specific period, such as up to a particular stage in proceedings. Legal services funding can also be used to recover historic unpaid legal fees if the Court is satisfied that without paying these fees you would not reasonably be able to obtain appropriate legal services in the future. However, we would caution against this approach and secure the LSPO before you owe your solicitors fees as the Court has a discretion on whether to award historic payments.

What steps do I need to take before I can apply for a LSPO?

You can apply for an LSPO if you can satisfy the court that you have no alternative means of funding legal services.  You will need to show that:

• You do not have sufficient funds but your partner does
• You cannot get a loan to pay for the services. This could include a specific litigation loan, as well as lending from a bank or credit card borrowing. A letter from a bank or litigation lender would evidence this.
• Your legal advisor is not willing to enter into a Sears Tooth Agreement (which assigns part of your settlement to your solicitor to meet their costs at the end of a case). You will need written evidence from a partner at the law firm to show that they are not willing to enter into this arrangement with you.
• You are not entitled to legal aid. Most cases will no longer be eligible for legal aid following reforms in 2013 so this is unlikely to be applicable.

What factors does a Court consider?

When deciding whether to make an order, the Court will have regard to the following factors:

• The income, earning capacity, property and other financial resources of you and your partner both now and what you are likely to have in the foreseeable future;
• The financial needs, obligations and responsibilities of both of you, now and in the foreseeable future;
• The proceedings and the matters in issue;
• Whether the paying party is legally represented;
• Any steps taken to avoid proceedings, such as attending mediation;
• Your conduct; and
• The effect of the order on the paying party and whether this will cause any undue hardship or prevent them from obtaining their own legal representation.

In summary, the Court must be satisfied that:

1. Without the order, you would not reasonably be able to obtain appropriate legal services;
2. You are not able to secure a loan to pay for the services e.g. through a credit card; and
3. You are unable to raise funds by alternative means such as securing a debt over your property.

Contact our Family Law experts

The family team at IBB can provide you with expert advice on all aspects of family law matters. Yasmin Kibble is a Solicitor within the team and can be contacted on 01895 207 834 or yasmin.kibble@ibblaw.co.uk.