MG & JG v JF

This is my judgment on the application by MG and JG for a costs allowance to be paid by JF. The application is made under Schedule 1 to the Children Act 1989. No other relief is sought under Schedule 1.

The subject matter of the principal application for which funding is sought is a private law children matter proceeding under section 8 Children Act 1989 concerning JFG, who is now aged 7. As I will explain, the case is complex both factually and legally. For this reason it has been transferred to the High Court. It is not yet concluded and there will need to be at least one further hearing before a final order can be made. Both MG and JG instruct counsel under the Direct Access scheme. They have already enlarged the mortgage on their property by £20,000 to pay costs. This notwithstanding, counsel are now owed fees. In addition MG and JG owe fees to experts. Counsel have made it clear that they will not continue to act until arrears of fees are paid and there is an assurance that future fees will be paid. This is perfectly reasonable. The fees that they have charged in the past, and propose to charge in the future, have been heavily discounted from the market rate already, and that is a worthy reflection of the best traditions of the Bar. But it is not reasonable to expect them to work for nothing. Their families, and the staff of their chambers, need them to earn reasonable fees.

JFG is separately represented by a guardian and by solicitors paid under a legal aid certificate. JF is of reasonable means and privately pays for representation by experienced counsel instructed under the Direct Access scheme.

On 1 April 2013 the Legal Aid, Sentencing and Punishment of Offenders Act 2012 ("LASPO") came into force. It removed legal aid from private law children proceedings save in those exceptional cases where domestic violence is a central feature. In such a case the alleged victim, but not the alleged perpetrator, might receive legal aid. Otherwise, at a stroke, 63 years of state funding of cases such as this was swept away. Had that "reform" not taken place both MG and JG would have been entitled to legal aid, although in JG's case subject to a contribution, estimated to be £1,004 (Footnote: ¹). With the state washing its hands of MG and JG they now look to JF to fund their representation.

Had MG and JG been in receipt of legal aid, or had they been of means and able to pay for their representation from their own funds without hardship, it is inconceivable that JF would be ordered to pay their costs. In the decision of the Supreme Court of Re T (Children) [2012] UKSC 36, [2012] 1 WLR 2281 it was confirmed that orders for costs in children cases would only be made where reprehensible behaviour or an unreasonable stance was proved against the respondent (see paras 4, 14 and 44). It cannot be said that JF is guilty of such conduct here.

Sections 49 to 54 of LASPO put the powers of the court to award a costs allowance on a statutory footing in relation to divorce and civil partnership dissolution proceedings. It is hard to understand why the government felt so strongly about the removal of legal aid from ancillary relief proceedings given that the statutory charge meant that it would recover the costs it had funded, with interest. The award of a costs allowance in ancillary relief proceedings does not normally give rise to complaints of injustice as the claimant can validly argue that she is only seeking an advance on her undivided and undistributed share, and the effect of the award can always be reconsidered and reflected in the ultimate discretionary disposition. These considerations just do not apply in children proceedings, and particularly so in section 8 proceedings.

In my decision of Rubin v Rubin [2014] EWHC 611 (Fam) at para 13 I set out a compendium of the governing principles under the new statutory provisions.

The new statutory provisions do not apply to applications to fund children proceedings, whether those proceedings concern the child's welfare or are for financial relief for the child under Schedule 1. In paras 14 and 15 of Rubin I stated:

"Curiously, the new statutory provisions do not extend to proceedings under Schedule 1 of the Children Act 1989, the Inheritance (Provision for Family and Dependants) Act 1975 or Part III of the Matrimonial and Family Proceedings Act 1984. In such proceedings the application will continue to be for an interim order for this purpose (see, in relation to Schedule 1 proceedings, M-T v T [2007] 2 FLR 925, G v G (Child Maintenance: Interim Costs Provision) [2009] EWHC 2080 (Fam), [2010] 2 FLR 1264 and CF v KM [2011] 1 FLR 208), and the principles in Currey v Currey (No 2) [2006] EWCA Civ 1338, [2007] 1 FLR 946 will continue to apply. In that case Wilson LJ stated at para 21 that the applicant must show that he or she cannot reasonably procure legal advice and representation by any other means. Moreover, the subject matter of the application will always be relevant as will be the reasonableness of the applicant's stance in the proceedings.

In my opinion the principles set out in para 13 ought to apply, with the necessary modifications, where an order is sought for costs funding in proceedings under Schedule 1 of the Children Act 1989, the Inheritance (Provision for Family and Dependants) Act 1975 or Part III of the Matrimonial and Family Proceedings Act 1984. Obviously, the first sentence of principle (x) will not apply…."

In CF v KM [2011] 1 FLR 208 Charles J stated at para 92:

"All cases are different, or have different aspects, but in my view it is clear that it is more likely than not that it would benefit the child if the mother was represented in both the s. 8 proceedings and the Schedule 1 proceedings. This accords with the conclusion I reached in M-T v T and the conclusion reached by Moylan J in G v G. In large measure, this view is based on the generally recognised advantages flowing from competent representation, and there being an "equality of arms" in an investigatory as well as in an adversarial process."

In this case it is my firm view that it is impossible for MG and JG to be expected to represent themselves having regard to the factual and legal issues at large. There would be a gross inequality of arms, and arguably a violation of their rights under Articles 6 and 8 of the European Convention on Human Rights and Article 47 of the European Charter of Fundamental Rights. So even though it cannot be said that JF has behaved reprehensibly or unreasonably he is the only realistic source of costs funding, subject to whatever contribution MG and JG should make from their own very limited resources. Some may say (and have said) that this is grossly unjust; I myself refrain from comment.

Civil legal aid for private law children proceedings was introduced by the Legal Aid and Advice Act 1949, subject to means testing. The Act was the product of the deliberations of Lord Rushcliffe's committee in 1945. It was part of the rolling out of the welfare state by the post-war Attlee government. It has rightly been described as the fourth pillar of the welfare state, the others being health, education and social security. Initially over 80% of the population satisfied the means test; this fell progressively so that by 2007 only 27% did. The right to legal aid in private law family proceedings was preserved in the Legal Aid Act 1988 and in the Access to Justice Act 1999. In 2005 the state funded about 45,000 such cases at a cost of about £130m.

Following the general election of May 2010 the new coalition government published in November 2010 the consultation paper "Proposals for the Reform of Legal Aid in England and Wales". In its foreword the then Lord Chancellor wrote:

"Legal aid must also play its part in fulfilling the Government’s commitment to reducing the fiscal deficit and returning this country’s economy to stability and growth. The proposals on which I am consulting are therefore designed with the additional aim of achieving substantial savings."

In para 4.11 it stated:

"The scheme in its current form is no longer sustainable financially if the Government is to meet its commitment to reduce the public financial deficit. We have therefore had to make tough decisions about where best to target resources."

At para 4.67:

"Given the need to direct resources at the issues of highest importance in a fair and balanced way, we consider …that legal aid is not routinely justified for ancillary relief proceedings and private law family and children proceedings. But we recognise that where there is an ongoing risk of physical harm from domestic violence, different considerations apply. In these cases, we consider that the provision of legal aid is justified where the client may be unable to assert their rights and may face intimidation because of risk of harm."

At para 4.207:

"While we understand that those going through relationship breakdown may be dealing with a difficult situation, both emotionally and often practically too, we do not consider that this means that the parents bringing these cases are always likely to be particularly vulnerable (compared with detained mental health patients, or elderly care home residents, for example), or that their emotional involvement in the case will necessarily mean that they are unable to present it themselves. There is no reason to believe that such cases will be routinely legally complex."

With very few changes the government's proposals were enacted in LASPO. A safety net was included by section 10(3)(b) which gave the Director of the Legal Aid Agency the discretion to award legal aid where "it is appropriate to do so, in the particular circumstances of the case, having regard to any risk that failure to do so would be …a breach [of Convention or EU rights]." As the President explained in Q v Q (No. 2) [2014] EWFC 31 at paras 6 – 8 the Lord Chancellor issued guidance concerning section 10(3)(b) which stated that it should be confined to "rare" cases which are of the "highest priority". But this guidance has been quashed as legally defective by Collins J in Gudanaviciene & Ors v Director of Legal Aid Casework & Anor [2014] EWHC 1840 (Admin). That decision is under appeal.

As the President explained in Q v Q the number of annual cases where the safety net has been applied can be counted on the fingers of two hands. In the year to March 2014 there were 9. Indeed between December 2013 and March 2014 one solitary case was caught by the safety net. The President stated at para 14 "if the scheme is indeed working effectively, then it might be thought that the scheme is inadequate, for the proper demand is surely at a level very significantly greater than 8 or 9 cases a year." Thus it would be perfectly reasonable to describe this "safety net" as a fig leaf. MG and JG have not applied for exceptional funding under section 10(3)(b), no doubt taking the realistic view that any such application would be rejected summarily.

Since the reforms have taken effect there have been an appreciable number of cases which have demonstrated that the blithe assumption in the consultation paper (that the parties' emotional involvement in the case will not necessarily mean that they are unable to present it themselves, and that there is no reason to believe that such cases will be routinely legally complex) is unfounded. This was entirely predictable. The cases are Kinderis v Kineriene [2013] EWHC 4139 (Fam) (18 December 2013, Holman J); Re B (a child) (private law fact finding - unrepresented father) [2014] EWHC 700 (Fam) (27 January 2014, Judge Wildblood QC); Q v Q [2014] EWFC 7 (21 May 2014, the President); Q v Q (No. 2) [2014] EWFC 31 (6 August 2014, the President); Re H [2014] EWFC B127 (14 August 2014, Judge Hallam); Re D (A Child) [2014] EWFC 39 (31 October 2014, the President); CD v ED [2014] EWFC B153 (14 November 2014, Judge Hudson); Re D (A Child) (No. 2) [2015] EWFC 2 (7 January 2015, the President); and Re K & H (Children: Unrepresented Father: Cross-Examination of Child) [2015] EWFC 1 (5 January 2015, Judge Bellamy). This is a formidable catalogue. Each case focussed on the gross unfairness meted out to a parent in private law proceedings by the denial of legal aid. I do not think it would be right to say that these were examples of the operation of the law of unintended consequences since, as I say, the problems were so entirely predictable.

Also of relevance is JG v The Lord Chancellor & Ors [2014] EWCA Civ 656 (21 May 2014) where the Court of Appeal held that the refusal of the (then) Legal Services Commission (LSC) to meet the cost of an expert report was unlawful. A district judge had ordered that the legally aided child, who was a party to the proceedings, should pay for that report. The order recorded that "the cost of the report to be funded by the child, the court considering it to be a reasonable and necessary disbursement to be incurred under the terms of her public funding certificate." In the face of a dogged refusal to comply with this order by the LSC the district judge later ordered that:

"The cost[s] of the expert to be funded by the child the court considering them to be a reasonable and necessary disbursement under her certificate and the purpose of the report is solely to establish what arrangements are in her best interests. Furthermore, the court has carried out a means assessment of both parents and found that they are unable to afford any part of these fees. In reaching this conclusion the court considered the provisions of section 22(4) of the Access to Justice Act 1999."

Notwithstanding this ruling the Legal Aid Agency (as the LSC had become) persisted in its refusal, and judicial review proceedings had to be commenced. The Legal Aid Agency actually succeeded at first instance but in the Court of Appeal, despite elaborate and trenchant argument by it and by the Lord Chancellor, who had intervened, its decision to refuse to comply with the order and to fund the report was held to be unlawful.

In Lindner v Rawlins [2015] EWCA Civ 61 the Court of Appeal heard an appeal by an unrepresented husband against a refusal to order police disclosure in defended divorce proceedings. The wife was neither present nor represented. Aikens LJ observed that the appeal was technical and unusual and that the husband could not be expected to have mastered this area of the law in order to be able to present his appeal in a way that assisted the court. He bemoaned the lack of the legal assistance of counsel that the court should have.

I need only cite a few of the judicial observations. In Kinderis v Kineriene Holman J described the position in which the unrepresented mother in Hague proceedings found herself as follows:

"The present procedure operates in a way which is unjust, contrary to the welfare of particularly vulnerable children at a time of great upheaval in their lives, incompatible with the obligations of this state under Article 11(3) of the [B2R] regulation, and ultimately counter-productive in that it merely wastes taxpayers' funds"

In Re H Judge Hallam was dealing with an unrepresented mother with speech, hearing and learning difficulties. An official of the Legal Aid Agency stated that there would be no breach of convention rights were she to remain unfunded. Judge Hallam stated "I find that statement astounding". In Re D the unrepresented father, who lacked capacity, had made an application to revoke a care order; the local authority had applied for a placement (for adoption) order. After heavy pressure from the President some legal aid was eventually awarded. At para 31(vi) of his first judgment the President stated:

"Thus far the State has simply washed its hands of the problem, leaving the solution to the problem which the State itself has created – for the State has brought the proceedings but declined all responsibility for ensuring that the parents are able to participate effectively in the proceedings it has brought – to the goodwill, the charity, of the legal profession. This is, it might be thought, both unprincipled and unconscionable. Why should the State leave it to private individuals to ensure that the State is not in breach of the State's – the United Kingdom's – obligations under the Convention?"

At para 21 of his second judgment he stated that "the parents can be forgiven for thinking that they are trapped in a system which is neither compassionate nor even humane."

In Lindner v Rawlins at para 34 Aikens LJ stated:

"Yet again, the court was without any legal assistance and had to spend time researching the law for itself then attempting to apply it to the relevant facts in order to arrive at the correct legal answer.  To do the latter exercise meant that the court itself had to trawl through a large amount of documents in the file.  All this involves an expensive use of judicial time, which is in short supply as it is.  Money may have been saved from the legal aid funds, but an equal amount of expense, if not more, has been incurred in terms of the costs of judges' and court time.   The result is that there is, in fact, no economy at all.   Worse, this way of dealing with cases runs the risk that a correct result will not be reached because the court does not have the legal assistance of counsel that it should have and the court has no other legal assistance available to it."

These are powerful criticisms. The President suggested that if the Legal Aid Agency would not award legal aid to an unrepresented parent facing serious allegations then the court might have to do so from its own budget. In Re K & H that was the course proposed. The Lord Chancellor instructed leading counsel who bravely argued that the President's analysis of the existence of this power was "plainly wrong". Judge Bellamy disagreed and awarded representation from the court budget. The Lord Chancellor is appealing that decision. It can safely be assumed that the criticisms I have recounted have fallen on deaf ears. Based on the decisions I have cited, including no fewer than four from the President himself, it can be said that in the field of private children law the principle of individual justice has had to be sacrificed on the altar of the public debt. And based on the observation of Aikens LJ, it can reasonably be predicted that the phenomenon of the massive increase in self-representation will give rise to the serious risk of the court reaching incorrect, and therefore unjust, decisions.

And so I revert to the application before me. Even though MG and JG are certainly not entitled to an order for costs they are entitled to seek an order for costs funding. To JF that may seem (with reason) to be a specious distinction without a difference, but that is where we find ourselves, now that the fourth pillar of the welfare state has been largely demolished.

Distilling the principles in Rubin v Rubin [2014] EWHC 611 (Fam), CF v KM [2011] 1 FLR 208), and Currey v Currey (No 2) [2006] EWCA Civ 1338, [2007] 1 FLR 946 it seems to me that on the facts of this application the following considerations are engaged:

I now turn to the facts of this case. Prior to 2005 MG (35) and JG (45), both females, formed a same-sex relationship and commenced cohabitation in a home they bought in the north of England. They in fact entered into a civil partnership on 14 July 2006. Unfortunately in April 2014, during the course of these proceedings they separated. Their civil partnership was dissolved on 9 February 2015.

In 2005 JG and MG decided they wanted a child. The responded to an entry placed by JF (62) in a register for "lesbian women and gay men seeking a non-sexual parenting partner". JF holds dual British and US citizenship and works in an academic position here. He lives in a same-sex relationship with a man in the south of England. According to his witness statement the mothers "were looking for someone who wants to be a biological father and have a relationship with their child, but doesn't want to be an equal co-parent". There were lengthy discussions. It was agreed that JF would be named on the birth certificate and that JG would be a "legal step-parent" with the idea that all three would have equal legal rights.

MG was impregnated artificially with JF's sperm in July 2006. On 24 April 2007 JFG was born by caesarean section. JF was present at the hospital. A legal agreement as to JG's status was made on 23 May 2007, the day JFG's birth was registered. On 13 August 2007 JFG was registered as an American citizen at the US Embassy.

From 2007 to October 2012 JF enjoyed periodic contact with JFG monthly or bi-monthly. The contact was typically based at the home of the mothers, or at JF's home, although JF was able to take his son out. Sometimes JF stayed at the home; sometimes in a hotel. In July 2012 MG fell pregnant, this time by a donor who has played no part in the life of PG who was born on 2 May 2013. In October 2012 the three adults and their son visited the USA (for the second time) for the purposes of attending the interment of JF's late mother. From October 2012 serious difficulties have arisen in relation to the contact of JF to JFG. All are agreed that the relationship between the mothers and the father broke down although, inevitably, there is strong disagreement as to why. It cannot be gainsaid however that MG's pregnancy was a contributory factor. The mothers say that the father had become increasingly individualistic and demanding about contact; the father says that he was being increasingly marginalised. The difficulties led to a solicitor's letter on the father's behalf. Progressively matters got worse. JFG himself began to express hostility to contact with his father. An issue about biological identity reared its head. An issue about education arose – the mothers wished JFG to be educated at home. An issue arose about JFG's phobia of needles in the context of his vaccinations. Conflict erupted on many fronts. Contact completely broke down, and was suspended on the recommendation of the previous Guardian pending advice from the psychologist. The separation of MG and JG, and illness on the part of MG, seriously aggravated the situation so much so that the Guardian made an application to the court under section 37 of the Children Act 1989 seeking an investigation by the local authority. That application was never in fact substantively adjudicated.

On 4 December 2013 JF issued his application for a contact order. On 31 January 2014 he issued a further section 8 application seeking specific issue orders about education and vaccination, as well as an application for assessment and therapeutic intervention from a child psychiatrist. On 4 February JFG was made a party and a guardian was appointed. There have been seven further court hearings, including a pre-hearing review before me. The matter was transferred to the High Court. On 9 October 2014 Moylan J ordered that an educational psychologist and a psychologist be appointed and do write reports. By the time of the pre-hearing review before me on 13 January 2015 both had written exhaustive reports. The psychologist recommended a detailed programme of supervised, facilitated contact to seek to restore the relationship between father and son, and many other therapeutic recommendations were also made. At the PHR all parties accepted these recommendations in principle. The final hearing was listed before me on 24 February 2015. The parties spent the better part of two days hammering out the details in a lengthy and detailed consent order. This sets up the managed contact and provides for an IRH where with hope a final order may be made. However it rightly anticipates a worst case scenario of a failure of the programme and provides for a five day final hearing in that event (which all fervently hope will not happen).

MG's claim is as follows. She owes now to counsel £10,670, including the refresher for 25 February 2015. She owes to the experts £2,182 as her share of the fees under an order previously made. She seeks £2,200 as counsel's fees for the IRH. She does not seek now funding for the final hearing; that will be dealt with by me at the IRH if that dreadful scenario eventuates. So she seeks a total of £15,252. JG's claim is much the same save that she now owes counsel less; she owes £5,910. So she seeks a total of £10,492. In addition both MG and JG seek that they should not have to contribute to any future all non-legal professional costs whether in respect of expert evidence or therapeutic work.

MG's financial position, based on her Form E and the submissions made at the hearing, is as follows. Although she co-owns her home with JG I was told that provided JG can be released from the mortgage she (JG) will transfer her share to MG in exchange for a clean break. The home is worth £165,000; there is a mortgage of £108,761. After notional costs of sale and mortgage penalties there is equity of about £53,000. MG has no other capital. Aside from costs she has debts of £3,800. Her income is made up of benefits of just under £20,000 per annum. She is writing a PhD thesis and receives a bursary which after expenses nets down to £2,200. She receives child support from JF of £10,296 (for JFG) and from JG of £5,088 (for both children). Her total income is about £37,500, from which she must support herself, pay her mortgage and care for two children.

However, after this judgment had been largely completed in draft and just before it was due to be sent out I received further witness statements from MG and JG. These revealed that the transfer by JG had in fact already happened on 9 February 2015. Further in order to enable MG to take over the mortgage she had to demonstrate a traditional source of income. As she was not working the only way she could do this was by purchasing a small nearby property on a buy-to-let basis so that she could show a rental income. That has duly happened and so instead of having one property with a value of £165,000 and a mortgage of £108,761 she now has two properties with a combined value of £280,000 with total mortgages of £225,971. The combined notional equities is in fact about £42,000: it is less than the £53,000 mentioned above because of increased costs of sale and mortgage penalties given that there are now two properties. Further the costs of purchase of, and SDLT in relation to, the new property have also enlarged the overall mortgage debt.

The earlier non-disclosure of these arrangements by MG and JG was distinctly shabby and stupid and they have both unreservedly apologised for their conduct. It involved deliberate misrepresentations to JF, and I have received a justifiably lengthy position statement from Ms King complaining about this. In truth, it was not however a material non-disclosure so far as JF is concerned as the revelations show that MG is actually worse off than I had believed to the tune of £11,000.

JG owns a house which she purchased some years ago as a rental property for £150,000. Since the separation she has moved there. The purchase price was found as to £58,000 on mortgage and £92,000 as a loan from her father. I do not regard that later debt as so soft that it should be ignored. She has very recently revealed that she has received a PPI compensation payment of £1,500; aside from that she has no savings and has debts of £2,500. She therefore has no net capital assets. She works for a charity earning net £27,500 per annum from which the child support of just over £5,000 is paid leaving her with £22,500.

JF lives with his partner in his (JF's) home which is worth about £1.22m. It carries a mortgage of £140,000. After costs of sale there is equity of about £1.05m. He has savings of £66,000 and pensions with a value of £1.1m. His net salary is £67,500 from which he pays the child support of £10,296 leaving him with about £57,200. His partner works for a charity and earns £18,000 p.a. gross.

In my judgment JF should pay 80% of each of the claims of MG and JG. Therefore he will pay MG £12,202 and JG £8,394. In addition he will pay 80% of all future professional costs in respect of therapeutic work and MG and JG will each pay 10% of such costs.

Thus MG will have to find £3,050 and JG £2,098 and they will each have to find 10% of the future costs of therapeutic work. In my judgment they cannot reasonably or realistically be expected to find more. By contrast, I am satisfied that JF can find, without undue hardship, the share with which I have shouldered him.

It could be said that it is grossly unfair that JF should have to pay now £20,596 plus 80% of the future therapeutic costs up to the IRH. But that is where the government has left him. It is a sorry state of affairs.

This leaves the costs of expert evidence which will come into being between now and the IRH. The consent order provides for the educational psychologist to answer further questions and for the psychologist to file an addendum report. In my judgment these should be paid for by JFG and in my opinion such fees are a reasonable charge on his legal aid certificate, for the following reasons.

In JG v The Lord Chancellor & Ors Black LJ explained at para 92 that when read with FPR rule 25.12(4)(a) (which provides that the court may give directions about the expert's fees and expenses) rule 25.12(6) (which provides that provides that unless the court directs otherwise, the relevant parties are jointly and severally liable for the payment of the expert's fees and expenses) is not intended to be prescriptive and merely establishes a default position for financial responsibility for the expert in the event that the court does not direct otherwise. She stated: "I do not see it as setting up a 'normal rule' that the cost is to be apportioned equally."

She further explained at para 93 that in order not to fall foul of section 22(4) of the Access to Justice Act 1999 that:

"It is necessary to ask what order the court would make in its discretion on the particular facts of that case, leaving aside any resources problems. The answer may not uncommonly be an order for equal apportionment of the costs but that cannot be assumed. It may be that a full consideration of the circumstances of the case produces the result that the publicly funded party should be paying a greater share of the costs in any event, quite irrespective of any financial difficulties that the other parties may have in sharing the cost of the expert. In such circumstances, section 22(4) does not prevent the court from making an order accordingly, because the order is in no way affected by the fact of public funding."

I do not think that the imaginary scenario that I have to address assumes that everyone is of means. Rather, it assumes the facts as they are with the sole exception that the child is not legally aided but is funded from another source, such as his own means or the means of a relative of substance. Were that the position I would have no hesitation in making an order that JFG bear the costs of these further reports given that MG and JG do not, on my findings, have the means to do so, and given the burdens that I have already imposed on JF. Further, and in any event, it is just and reasonable that JFG bears these costs whether or not he is legally aided because at the end of the day these fees are being incurred primarily for his benefit.