A NEW WAY TO FUND LEGAL PROCEEDINGS?

 Cotswold Family Law OfficeIt is often a problem for one party who does not work to fund legal proceedings if they do not have access to joint funds or any independent means.  They may negotiate a loan from their solicitor on the basis that they will repay the costs once the house is sold but it is obviously a risk that a lawyer may not want to take.  There may be other options but any sort of borrowing has costs and again is often not available if the person is seeking to borrow has no employment.

As most people are now aware, on 1st April 2013 Legal Aid was made unavailable for Family Law matters unless there are aspects of domestic violence.  At the same time that this change happened, a new section was added to the Matrimonial Causes Act 1973 which  gives the Court a new power to award interim lump sums for the purpose of funding legal fees in divorce, judicial separation and also in proceedings dealing with the financial aspects of a parties’ separation.  These financial aspects include what to do with the matrimonial home, maintenance for a spouse or the children and issues in relation to pensions and other financial assets.

There always used to be a possibility of applying for interim maintenance so that a spouse who does not have any funds could receive maintenance from the other on a temporary basis and this would often enable them to fund legal proceedings.  This has now been changed so that you can apply for interim maintenance but you cannot include anything to cover the cost of legal fees.  In other words you can still apply to the Court for a temporary maintenance order to enable that party to have funds to live, pay rent or whatever but it cannot include anything to cover legal fees.  That has to be dealt with by a separate application under this new clause Section 22ZA.

The section also makes it clear that proceedings must have already been issued before a Section 22ZA application for legal funds can be made – in other words you will have already had to have made the application and incurred costs before you can seek any funding towards the payment of those costs.  So Section 22ZA is very much a last resort for funding for legal fees and the Court will only make such an Order if they are satisfied that the Applicant cannot reasonably secure a loan to pay for legal services or cannot obtain funding on the basis of being likely to receive assets as a result of those legal proceedings.

The new route for funding proceedings does not seem a very attractive way to go.  It seems to make it even more difficult to obtain help with legal fees.  It is still going to be the case that the best initial option is to try and persuade the former spouse to make existing family assets available.  The absence of Legal Aid still has the effect of putting the weaker party at an even greater disadvantage in legal proceedings.

For more information about any of these points please contact Cotswold Family Law by telephoning 01608 686 490 or by email on info@cotswoldfamilylaw.co.uk or visit our website namely www.cotswoldfamilylaw.co.uk.