Are the costs consequences of not accepting an offer to settle about to change?

In financial remedy proceedings ancillary to divorce, the general rule is that each party is responsible for their own legal costs and the court will only make a costs order in rare circumstances. However is this about to change?

The Family Procedure Rule Committee are in the process of deciding whether to amend the Family Procedure Rules to enable any “without prejudice” offer to be taken into account when the court is considering making an order requiring one party to pay the costs of the other party. A letter marked “without prejudice” means that the letter cannot be used in court and cannot be seen as the party’s last word on the matter.

The aim of the consultation is to try to encourage parties to engage in sensible negotiations and if possible to try to resolve matters out of court.

If the above amendment to the Family Procedure Rules is made, it would bring the costs regime of financial remedy proceedings closer to that of other civil proceedings so far as to cost consequences of unreasonably refusing a sensible offer.

The consultation comes after a recent amendment to the Family Procedure Rules 2010 Practice Direction 28A which has clarified the court’s approach to costs in financial remedy proceedings where one party has unreasonably refused to accept an open offer.

John Hodge Solicitors has a Family Law team with experience in all aspects of family law, including disputes over financial matters (whether you are married or in a cohabiting relationship), children issues and divorce. Our solicitors are members of the Law Society’s Family Law Panel and Resolution and you can therefore be confident in the advice that you receive. The Family team offer a free consultation within which they provide expert advice with no obligation.

Stephanie Hinde