Wasted Costs Order

Family Finance

In the case of Fisher Meredith v JH and PH [2012], a wife’s solicitors appealed against a wasted costs order made against them.

In this case a final hearing in financial remedy proceedings had been listed.  On the first day of that hearing an application was made to adjourn the proceedings to allow time for third parties to be joined to the proceedings.  The third parties were alleged to be the beneficial owners of shares in a company that was held in the husband’s name.

The husband had been allocated the shares three years before the marriage.  Prior to the couple separating the shares were transferred to the husband’s aunt.  The husband argued that the shares were for the benefit of his uncle and his brothers.  The wife applied to set aside the transfer and the aunt was made a party to the proceedings.

Two days before the hearing the wife’s solicitors were given 123 pages of documents relating to the company formation.

The wife’s solicitors requested an adjournment to allow third parties to be joined to the proceedings.  This was allowed, however, a wasted costs order was made against the wife and her solicitors were given notice to explain why they should not be personally liable for the costs.

The judge made the costs order ruling that the wife’s solicitors had known back in 2009 that the beneficial interest in the shares had not belonged to the husband.  The judge ruled that this amounted to ‘improper, unreasonable or negligent conduct’.

The wife’s solicitors appealed.  The appeal judge ruled that the wife, husband and aunt had expressed their wish for the issue to be determined without including further members of the husband’s family.  If that was wrong then the blame lay with the husband for not inviting family members to intervene and on the family members for not intervening to protect their interests.  The solicitors had not been negligent nor had they acted improperly.

Although costs had been wasted the adjournment would have been necessary to consider the new documents.

If you would like advice regarding divorce and finances please contact our Family Law Department for a free initial interview on Eastbourne 01323 727321 or Hailsham 01323 841481.

Nicholas Dennis
Nicholas Dennis
Alexandra Funnell
Alexandra Funnell
Guy Brown
Guy Brown
Carolyn Richards
Carolyn Richards