Since April 2013, the family courts have been able to make orders requiring one party to pay the other an amount to enable that party to pay for legal advice (referred to as legal services payment orders (“LSPOs”)). In this article, senior associate Sarah Harvey and associate Olamidé Nakou from the Divorce and Family team based in Leeds, consider two recent judgments concerning LSPO applications that highlight different approaches taken by judges in such cases.

The two recent cases involving applications for LSPOs (under sections 22ZA and 22ZB of the Matrimonial Causes Act 1973 (“MCA 1973”)) are HA v EN [2025] EWHC 48 (Fam) and SM v BA [2025] EWFC 7. Both cases concerned applications for interim maintenance and applications for the funding of historical and ongoing legal costs. This article will focus on the LSPOs decisions.

Current debate

There is currently a debate around whether historical legal fees incurred within ongoing financial remedy proceedings should:

1. be paid at all,
2. if paid, whether they should be paid in full, or
3. if paid, whether they should be subject to a discount based upon the typical percentage discount to costs orders made on a standard basis in civil proceedings (“a standard basis assessment”).

What may be termed “the Cobb approach” follows a line of authorities mostly arising from Mr Justice Cobb, in which historical costs are subject to a discount in line with a notional deduction to reflect a standard basis assessment.

HA v EN

Background

The parties married in 2009 and entered into a pre-nuptial agreement before the marriage. The agreement made provisions for a housing fund, spousal maintenance and child maintenance, with a clause seeking to cap the wife’s entitlement at 50% of the total assets. At the time of the pre-nuptial agreement, the husband disclosed assets of approximately £61m. Disputes subsequently arose as to the enforceability of the pre-nuptial agreement due to the husband’s alleged financial decline.

Issues

After a failed private settlement hearing in March 2024, the wife applied for interim maintenance and an LSPO. Prior to the settlement hearing, the wife’s estimated costs up to and including that hearing were £202,489. The husband’s estimated costs were £146,874.

In keeping with the process for obtaining LSPOs, the wife had applied for a commercial loan. Her loan from litigation lenders was refused, and her legal representatives would not enter into a ‘Sears Tooth arrangement’. (This is an arrangement whereby the solicitor defers a client’s fees, which are then paid from the divorce settlement once the case concludes.) In the absence of a commercial loan to meet her legal fees, the wife requested funding from the husband in the sum of £450,000, £90,000 of which would be used to meet her outstanding, historical costs.

Having submitted five questionnaires, the wife claimed that the husband’s disclosure was misleading, inconsistent and materially deficient. The husband denied this. It is noteworthy that for undisclosed reasons, the wife had changed solicitors and counsel three times. The judge observed there would be an additional cost in getting new solicitors and counsel up to speed, and she would be “depriving herself of continuity of representation”.

For her LSPO application, the wife sought outstanding fees totalling £75,776.40 in respect of her former solicitors, Starck Uberoi, to be paid so that her latest solicitors, Harbottle & Lewis, may have access to papers that were currently subject to a lien. The wife also sought to recover £97,290 of outstanding costs owed to Harbottle & Lewis and further work in progress of £36,613, not including VAT. In addition to her outstanding costs, the wife sought a total of £837,270 to meet her future litigation costs until a final hearing.

The law

The court cannot make an order unless it is satisfied that without the amount, the applicant would not reasonably be able to obtain appropriate legal services for the proceedings (sections 22ZA and 22ZB MCA 1973).

When considering the overall merits of an LSPO application, the court considers all the matters in section 22ZB(1) to (3) of the MCA 1973, such as the financial resources each party has or is likely to have in the foreseeable future.

In Rubin v Rubin [2014] EWHC 611 (Fam), the High Court gave detailed guidance about the principles and procedures that govern LSPO applications. The judge held that an LSPO should only be awarded to cover historical unpaid costs where the court is satisfied that without such payment, the applicant will not reasonably be able to obtain appropriate legal services for the proceedings in the future. Further, where disclosure by the payer is obviously deficient, the court should not hesitate to make robust assumptions about their ability to pay.

Decision

In HA v EN, the judge was not satisfied that the husband’s disclosure was “obviously” deficient. However, the wife did not have to prove that the husband was lying to obtain an LSPO. Ultimately:

1. She was unable to obtain alternative litigation funding,
2. No Sears Tooth arrangement was available,
3. Legal aid was not available, and
4. The parties had considerable unrealised resources.

Therefore, the judge was satisfied that the wife would not be able to obtain legal representation unless some form of LSPO were made.

The judge directed the husband to make staged payments for legal services provision to both parties’ legal representatives, secured by charging orders. The husband was ordered to pay £626,585 by way of LSPO, the judge having followed the approach started by Mr Justice Cobb and applying a 30% discount to the wife’s historical costs.

The judge found that Harbottle & Lewis’s argument that Starck Uberoi must be paid or they would not be able to see their file was “an unimpressive excuse for seeking payment” but accepted Harbottle & Lewis’s partner’s evidence that his firm would “down tools” if not paid. The sum claimed by the wife was £89,596. The judge ordered that 70% of these costs could be recovered as if he was approaching costs after a hearing on a standard basis assessment.

The judge adopted a broad-brush approach regarding the wife’s future costs to the final hearing. He ordered that her costs be funded to £610,000.

Recognising the wife’s inability to pay her legal fees and the husband’s financial capacity to contribute, the court approved a significant LSPO, albeit her historical costs were subject to a discount.

SM v BA

Issues

In this case, the wife’s LSPO sought an order for the husband to pay £1,121,467 in outstanding and estimated future legal costs broken down as follows:

• £240,000 in unpaid invoices,
• £650,000 for future costs up to and including a private financial dispute resolution hearing,
• £47,000 for her interim maintenance application, and
• £182,000 relating to a previous Family Law Act application.

The wife had been refused litigation and commercial lending, and the husband did not oppose the LSPO in principle. The wife’s solicitors would not enter into a Sears Tooth arrangement and had agreed to extend credit only to the determination of the LSPO application.

The husband had made an offer to realise £500,000 worth of shares and pay equal amounts to each party’s solicitors.

Similarly to HA v EN, the wife’s case was that the husband’s disclosure was deficient and that the judge should make robust assumptions about his ability to pay.

Decision

Notwithstanding the contentions of both parties, they had considerable resources. The husband accepted that he held shares capable of being liquidated worth around £10m, so there could be no concerns about affordability.

In relation to the historical costs, £178,000 related to the financial remedy proceedings and £64,000 to the Family Law Act proceedings. The element relating to the Family Law Act proceedings was dismissed; those applications had already been compromised on the basis of “no order for costs”.

In relation to the historical financial remedy costs, the judge, Nicholas Allen KC, considered these to be recoverable and was satisfied that, without such payment, the wife would not be able to obtain appropriate legal services. He noted that the wife’s solicitors and counsel need not offer unsecured interest-free credit to undertake their work.

The judge did not consider it appropriate to make deductions to the wife’s historical costs. He noted that Mr Justice Cobb’s justification for his approach was to refer to Part 44 of the Civil Procedure Rules (CPRs) (which covers rules on costs in legal proceedings such as who pays, how much and when) and the need to consider whether costs were reasonably incurred in both amount and proportionality. However, in the case of Rubin, Mr Justice Mostyn had held that the LSPO jurisdiction should not outflank the costs jurisdiction in Part 44 of the CPRs.

In this case, the judge considered that the CPR provisions do not apply to LSPOs as they are not Costs Orders. He said Mr Justice Mostyn’s comments in Rubin had to be seen in the context of the case. Mr Justice Mostyn was effectively clarifying that LSPOs should not be used to order that one party pay the costs of the other in respect of concluded proceedings, in which any costs orders would already have been made.

In Nicholas Allen KC’s view, those facts do not apply to an applicant seeking an LSPO with respect to costs incurred and to be incurred within ongoing proceedings. Therefore, he regarded a notional reduction as inappropriate in an LSPO. He allowed the wife’s historical costs in full.

Key takeaways

Partner and Head of Divorce and Family Leeds Adrian Clossick comments:

“In respect of LSPO applications, it is important to be specific about why a previous solicitor’s files are required for future representation. Parties should also be aware of the differing approaches taken by judges; a notional deduction could be made to historical costs, but there is current judicial uncertainty and guidance from the higher courts may be required. The courts should not lose sight that an LSPO may be required to ensure an equality of arms and be aware that applying deductions to costs incurred may undermine that aim.”