An important and often contentious point in Family law cases is providing for parties legal costs. Ordinarily, in matters relating to finance, the loser pays principle applies. What this means is the party who successfully brings an application or a party who successfully defends an application will usually be awarded their costs related to that application. In cases where costs are contested the Family Court Judge has a wide discretion to adjust the usual costs order. This may occur when there has been misconduct by a party, or it would impact the financial provision for a family member needs if the order was made.
In children’s proceedings, for example application relating to custody or access, the usual order for legal costs is ‘no order as to costs’. This means that each party should pay their own legal costs irrespective of the outcome of the application. The rationale for this approach is to ensure the child’s best interests remain to be the focus and not to promote the idea of a winning or losing parent which may encourage further conflict. Again, the Family Court Judge has a discretion to make a different order but in practice this is uncommon and would usually only be ordered in cases of significant misconduct.
In cases where compromise is reached parties can make provision for how their legal costs will be paid. Ordinarily, both parties will be expected to agree a ‘no order as to costs’ approach to recognise that compromise has been reached. Levels of legal costs debt or sums already paid can be considered when negotiating the compromise.
If there is a dispute on the sum payable as between a solicitor and own client or a party required to pay for another party’s legal costs, parties can apply for taxation. This is a specific judicial process which should be commenced within 12 months of receipt of the bill. Depending on the sums involved a Chief Judicial Judge or Taxing Master will be required to decide on the sums properly owed.
Assistance with legal fees can be provided by the Legal Aid Department for those with limited resources. Information can be found here Legal Aid Department – Home (lad.gov.hk). Applications are means and merits tested, and applications are often able to choose their solicitor from a panel of lawyers available. It is important to note that Legal Aid is not free and those receiving legal aid have obligations towards the Director.
Many costs orders will be initially made on a decree nisi basis meaning parties have a short window to dispute the order provisionally made. Following the passage of the appropriate time or following further consideration of any letter of dispute, and Order Absolute shall be made. Appeals can also be lodged.