One of the biggest bugbears faced by family law practitioners is the lack of consequences for litigants on the other side of a case behaving unreasonably and failing to negotiate.
The general rule when it comes to legal costs – established in 2006 – is that no costs orders are made, therefore each party bears their own costs. Prior to this, Calderbank offers (made without prejudice save as to costs) allowed the court to take into account reasonable offers made by one party but rejected by the other party, when considering the issue of awarding legal costs. The threat of costs orders encouraged early proposals for settlement, and frank without prejudice discussions.
Whilst there are concerns raised by some, such as Mr Justice Mostyn that costs orders can disproportionately lead to unfairness, the power and threat of a costs order is sorely needed in cases where poor litigation conduct runs riot without consequence.
I was therefore more than excited to see that this topic has finally made its way back onto the table and that the Ministry of Justice have launched a consultation on Calderbank offers as part of their ongoing research into the functioning of the current costs regime in financial proceedings.
Views can be given using this link:
One key area concerned encouraging parties to engage reasonably and responsibly in settlement negotiations. As part of this, the FPRC is considering whether the FPR 2010 should be amended to enable any the offers which are made 'without prejudice save as to costs (known as Calderbank offers) to be taken into account as 'conduct when the court is considering making an order requiring one party to pay the costs of another party.