Pound for Pound Orders: LKH -v- TQA AL Z [2018] EWHC 2436 (Fam)
In July 2018, Mr Justice Holman injuncted a husband from paying any further money (whether for their profit costs or disbursements) to any firm of solicitors practising in England and Wales instructed by him (or any counsel instructed by him on a Direct Access basis) unless he pays an equal amount (i.e. pound for pound) to the wife’s solicitors towards satisfaction and discharge of the arrears and current instalments of legal services funding under an earlier order of the Court.
The arrears due from the husband that had arisen since 19 April 2018 amounted to £100,000 unpaid maintenance, plus £120,000 costs allowance, plus £10,000 in actual costs, making a total of £230,000.
The husband’s net wealth is said to be about US $45 million or around £34 million but he asserted that those assets were “illiquid and unrealisable.”
However, while pleading that he was not in a position to pay any money to his wife, he was able to pay his newly instructed solicitors £95,000.00 on account of their legal costs.
When the Judge enquired whether that £95,000 had already been expended (or whether he was in surplus in his client account with his new solicitors) he was told that the husband was already now in deficit, so the actual amount of costs that he had chosen to run up in the space of a month exceeded £95,000.
The unfortunate wife had run up costs well in excess of £200,000.00 without the funds to pay her solicitors who had agreed to “extend her credit”.
During the course of the hearing the Judge was referred to the judgment and decision of Bodey J in the case of Mubarak v Mubarik [2007] 1 FLR 722 in which he made what he called a “pound for pound” order.
Holman J accepted that the rationale of such an order must be that of an equal or level playing field, which meant that the Mubarak jurisdiction could properly be applied to require a payer (usually the husband) to pay substantially more to the other party than to his own solicitors.
Therefore, in his view, the jurisdiction should correctly be regarded as a pound for pound one, so that from now on in, with every pound that the husband chooses to pay to his own lawyers, he must pay an equal pound to the wife’s lawyers also.
Whilst the hearing took place in July, the 10 page Judgment has only recently been published and for anyone interested the full judgment can be accessed here:
