An unfortunate reality of the separation process is that you incur potentially significant legal fees along the way. That is especially the case if you and your ex are unable to find a negotiated outcome, and as a result your separation requires you to go all the way through litigation.
Many people might have the view that if you “win” in litigation, your costs will be covered by the other party.
However, costs in family law proceedings don’t necessarily work that way.
In this article we’ll give you a rundown on how a Court is going to approach the question of costs in a variety of circumstances, and some of the basic principles about how legal costs work in family law proceedings.
Can you make your ex pay for your legal costs in family law proceedings?
Not usually.
The starting point for legal costs is that each party to a family law proceeding is going to bear their own costs. That means you pay your own lawyers, your ex pays their lawyers, and nobody contributes towards the other’s fees. This general rule applies to any Court proceeding under the Family Law Act.
Deviating from that general rule requires circumstances that justify doing so.
So what are the kinds of circumstances where a Court could consider making a costs order against your ex?
As you’d expect, the Court can consider any matter it considers relevant. The Court has a wide discretion to look at anything it wants to in deciding whether to make a costs order against a party.
There are, however, a list of specific things that the Court will look at.
None of these factors will absolutely determine the outcome, but each will be weighed and taken into account as being either for, against, or irrelevant to the making of a costs order in a specific situation:
What you’ll notice is that almost all these items are variations on a particular theme – the conduct of the parties. So the best way to think about this topic at a big picture level is that the Court is going to consider whether a party’s position, or conduct, was significantly unreasonable in the circumstances. If it was, then that could flow through to a potential costs order against them.
Many people mistakenly believe that if they get a “costs order” from a Court, then it will cover their legal fees in full.
This is not generally true.
Sometimes the Court will make an order for costs in a fixed amount. This is more common in smaller, simpler applications where a Court can be satisfied that a particular amount is appropriate to order.
Otherwise, the typical costs order a Court will give is for costs on a “standard” basis. This means that the amount of costs payable by the other party will be calculated using a table (called the “scale” of costs). The table is specifically designed to be lower than the actual costs you have probably incurred.
In rare circumstances, the Court might make an order for “indemnity” costs. This is a costs order that is calculated by reference to what you have actually spent with your lawyers, and will come much closer to fully compensating you for your legal fees. It is, however, a very uncommon order and generally only made if the Court considers a party’s conduct to be particularly unacceptable, or a party makes a strong case following an offer to settle (see below).
One of the things you will inevitably explore with your family lawyers in the separation process is whether, and when, you might make an offer to resolve the matter on certain terms.
You might, for example, make multiple offers to resolve the matter as part of a mediation.
Outside mediation, however, you could also send specific written proposal to resolve the outstanding issues.
This is not just a good idea because if could help end proceeding early, but it can also offer some strategic benefit.
Specifically for this article, a properly considered offer to settle the matter can increase your chances of getting a successful costs order.
While there are many things to think about in an offer to settle, the fundamentals are:
Of course during some matters there might be a number of different offers to settle a proceeding. Some might be for “costs protection”, and others might not. Generally speaking your family lawyers will discuss with you the possibility of making an offer to settle the matter at multiple key points along the way in any separation proceedings.
Of course, costs orders are not typically the most important thing that you’ll be concerned about during separation – your focus will be on finalising your former relationship and moving on with a clean start.
That said, because legal costs can be significant, it’s a good idea to consider (with your family lawyers) ways to improve your chances of securing a costs order and minimising the risks of getting one against you.
That will be relevant to what things you contest in the proceedings, what offers (if any) you might make to try and resolve the matter before a trial, and what position you take on various issues throughout the separation process.
Give us a call today if you need help on this, of any other, issue with your separation.
Call us +61 3 7002 6222
Email us click here
Visit us Raglan House, 4/27-33 Raglan Street
South Melbourne VIC 3205 map
Accessible Family Law acknowledges the First Nations People paying respect to Elders past, present and future as the traditional custodians of this land. We live, learn and work on the lands of the Bunurong people of the Kulin Nation.