Tag Archives: Courts

The Huge Cost of Court Proceedings

The chairman of the Laura Ashley  Khoo Kay Peng has been ordered by the High Court this February to make an offer to Pauline Chai his estranged wife to end legal battle that has  cost him £6.1million in legal costs. Mr Justice Bodey gave his lawyers a 21 day ultimatum.

The case which at one stage was also running  in Malaysia, is one of the most expensive divorce cases ever to come before the UK courts.

Costs began to increase dramatically when Khoo fought and lost a bid to have the divorce decided in the Malaysian courts. Chai, who was Miss Malaysia 1969, won the argument that London was the appropriate location.

The Judge ordered “open offers of settlement” to be made by both sides, and said at a case management hearing: “I am striving to exercise some control over this titanic case. Otherwise the case will inevitably proceed on its expensive way to the detriment of the parties and the court’s resources. The actual resolution of the finances of this couple, who have more money between them than they could spend in their lifetimes, has unfortunately taken a second seat. The legal costs bill is going on for £6m at a stage where the case has barely reached the first fence.”

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Chai, 69, alleged that Koo,77, was worth more than £440 million and earned £5.4 million a year. They have five grown up children and she maintains that she is entitled to half of his fortune. He disputes her claim and maintains that his assets are worth £66 million.

The couple married in December 1970 and separated on Valentine’s Day 2013. A decree nisi was pronounced in January this year and is due to be made absolute later this month.

They bought their first property in England – Wentworth Park – in 1995, and then five years later acquired the 1,000-acre Rossway Park estate at Berkhamstead. Khoo has indirect interests in a variety of businesses through two holding companies in Malaysia as well as substantial holdings in Laura Ashley and Corus Hotels.

Although the figures and costs are extreme many couples who navigate financial proceedings within divorce in this country will be all too familiar with the huge cost of court proceedings to them. If a case reaches or nears a final hearing both parties can incur upwards of tens of thousands in legal costs and certainly many thousands for the first few hearings.

Here at Focus we offer mediation as an alternative route to resolve these disputes by allowing a separating couple to discuss various options with a trained mediator thus avoiding lengthy court battles and the stress that this entails. Throughout the process they both work with the mediator to help them reach an agreement that they are both comfortable with. Mediation gives the couple a degree of control over the speed and cost and is quicker and less expensive than court proceedings. Some couples prefer to have their lawyers with them at mediation. This can be arranged with a dual trained Focus mediator able to use the One Day civil model of mediation, which results in a binding agreement being drawn up by the lawyers on the day.

For more information please click on our website.

Tara Deegan

How things end is even more important than how they began

We all remember significant moments in our lives. The moment we first met our future partner, or made a commitment to them. The moment we held our new-born child in our arms for the first time, left them at nursery or school the first time, or took them to university and waved goodbye. We remember making friends, seeing special places, films, music. We flash back to when we read our first long book, to an insight we had into something profound. A cherry tree in full blossom, a rose, our first champagne, a wedding, a funeral, Christmases or other festivals.   The list is long.

We must add to it those things which were endings. Things done for the last time. The final good bye to someone we love who died, or the sudden failure to re-appear, when they died without warning, with no leave-taking. Leaving places, especially homes, schools, places we have been happy or sad or both. Moving on, departures from people we were close to, shared time with, perhaps flats or homes. Then there is the ending of relationships as couples. The ones that we thought were forever, that fail or turn sour. The divorces, partnerships, especially those where we had children, as in a material sense those relationships never end. The children are always there to link you.

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Those un-couplings are so important and need even more careful management than the weddings that started them. There may be a powerful instinct to fight, a fear of losing out that motivates conflict over resources. The usual ritual is to appoint a lawyer each to try and get you the biggest share, in case you lose out. That adversarial process often damages what is left of the relationship, destroying direct communication and preventing the establishment of new friendly non couple boundaries with that person you are detaching from, but with whom you have spent a significant part of your life.

Often the costs of the legal ritual can cost more than the value of what you are arguing about if it is finances. When you look back, you will remember all this. How it ended. The sweet and the sour. It doesn’t have to be a bitter contest. Mediation helps couples detach kindly, to create the new understandings and boundaries they need as separated parents. If you are splitting up, you will remember always what it was like, who did and said what to whom, how it was done. Don’t make the mistake of fighting. Mediate a good end, something you can remember that you did as well as was possible, with kindness and dignity.

Warring Families Beware

The Court of Appeal’s judgement in Ilott and Mitson (2015) EWCA Civ 797 may encourage adult children to challenge wills where they consider their parents have not made reasonable provision for them.

will

Melita Jackson had left an estate worth £486,000 to the RSPCA and Blue Cross charities after her death in 2004. Her daughter Heather Ilott now 54 challenged the will under the Inheritance (Provision for Family and Dependants) Act 1975. Heather and her mother were estranged after she left home at the age of 17 with a boyfriend and she had been excluded from the will. Mrs Jackson made it clear that her daughter should inherit nothing.

The court determined that she was not given a reasonable provision from the estate and awarded her £163,000 to buy her home and provide                 future maintenance.

This ruling means people can still disinherit their children but they will have to have a good reason why. Adult children who have been left out of wills may find it easier to challenge them if they have not been left a reasonable provision.

What’s your story?

Any parent facing six weeks of summer holidays has the challenge of keeping the kids entertained, and if you have separated from your partner, the challenge is even tougher.

The Oxford Story Museum does a fantastic job at offering diversion for families who love reading. http://www.storymuseum.org.uk

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Their imaginative conversion of a rambling old house on Pembroke Street now offers rooms where children can take part in a fabulous array of book-related activities.

There’s an Illustration Exhibition with a live ‘Illustrator Zoo’; the chance to dress up and sit on the Talking Throne; a giant bed, where all sorts of people are reading bed-time stories – and there are rooms rigged out to feel like a scene out of people’s favourite books – Treasure Island, Narnia – where you can snuggle up and read stories to your heart’s content.

We all love stories. As adults, we develop the knack of creating a story in our heads about how life is treating us – usually unfairly ­– and when our marriage breaks down, that story becomes a script we hang on to, to prove how badly the other person has behaved, and how awful they made us feel.

In family mediation, those stories are important. Focus mediators always start by asking each person to spend an hour just talking about themselves, in private, in complete confidence, so that the mediator gets the hang of how things look from both points of view, and each of you feels heard. But when the joint sessions start, at which you come together with the mediator to discuss the issues you’ve got to sort out – arrangements for the children, what’s happening about the house, how is maintenance going to work, and what about the pensions – those stories become less important. It’s not about who did what anymore; it’s about who is going to do what, so that you can both move forward into your independent lives. Not exactly stepping through the wardrobe, and not nearly so much fun, but a constructive, reasonable, mature way of dealing with divorce. It’s comparatively quick, and cheap – and the kids will thank you for it.

Control, Leverage and Letting Go of Relationships

As mediator I see hundreds of couples at the point where they are negotiating their arrangements for separation and divorce. It is fascinating. Many of them say they ‘Just want what is fair’ and that ‘They just want to sort it all out as quickly as possible’. They may well then embark on behaviour and an approach to negotiations that will ensure exactly the opposite happens, it does not get sorted quickly and what they want is what the want and it may not be fair. They bring their couple boundaries into mediation where they have to be managed by me as the mediator to achieve a fair negotiating balance between the parties to mediation. So the so-called controller will have to let go of his or her influence over their ex partner and they will find this very hard. As mediation progresses it often becomes clear that the couple will never agree what is fair because this is an opinion seen through the lens of their self interest. It is possible to argue endlessly about fairness and people often feel very strongly about certain things, even when in law these things may make no difference at all. In most cases the main question is ‘How can these assets provide for you both and any children? What is practical?’ On divorce there is no forensic accounting and handing back of contributions made 20 years ago and the partner who has worked in the home childrearing and housekeeping is treated equally to the partner who has earned the income on which the family has lived.

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Controllers may seek to use their historic influence in negotiating their settlement in mediation. An effective mediator helps the couple to re-define their couple boundaries, especially the ones relating to influence and control and re-balance the two people on a consciously more equal footing, something both necessary and extremely uncomfortable. An example may help:

Towards the end of the mediation when the issues have almost been resolved, one party may hesitate, and delay booking the final session. They may raise additional issues and appear to start new or old arguments, running the risk the mediation will collapse and court will be the only option, this holding the couple stuck in their existing boundaries for longer with historic levels of control and influence. What are they afraid of? They may be unconsciously afraid of losing control or influence of their nearly ex partner.

My heart always sinks if I hear someone worrying about ‘Leverage’. That is not a good word, it imports a world of meaning associated with the exploitation of a dominant negotiating position to exercise non consensual control. The controller will fear loss of control mightily and will seek to retain it. They may well also complain bitterly about lack of communication with the controlled or leveraged person. They will not understand the connection between the leverage they are accustomed to exercising and their poor communication with their victim. As I said to one divorcing man recently, as he twitched nervously about his loss of financial leverage on settling his finances with his ex wife, ‘Have you ever thought if you didn’t have any leverage over her, your relationship with her might improve and with it your ability to communicate over your children?’ He looked at me with real fear and lack of comprehension, so I held his eyes and said ‘Just think about it!’

Proportionality

The costs of litigating a case should be in proportion to the value of the dispute. Official – but forgotten repeatedly.

The Ministry of Justice, the judges, everyone – says the costs of going to law should bear some sort of rational relationship to the value of the dispute. Yet this rule is frequently and flagrantly ignored. Focus Mediation frequently finds the main issue in dispute in mediation is the costs of proceedings at court. So, in one case where flat owners were arguing over noise between their flats (one flat was over the other), the costs were £62,000.   There was at the pre-trial review. The judge heard that the budget for costs to go to trial was a further £30,000 including the lawyers and the experts. The agreed costs of the works of noise proofing between the flats was under £4000! The costs had become the issue. If one party could ‘Win’ then the other would lose twice, they’d .have to pay all the costs. The judge had little paddy and said they had to mediate. Now this is unusual, as actually the courts have no power to force people to mediate, but he was incensed enough at the flagrant breach of the rule of proportionality on costs to send everyone away for mediation. The Focus mediator settled the case. One flat owner bought the other’s flat, not even a result the judge could not have imposed he’d wanted to. This is a classic example of conflict having a life of its own, of the disputants losing the plot and ending up in a ridiculous situation, where their litigation costs were the main issue. There are many reasons this can happen.

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The lawyers may advise that they cannot advise as to whether someone’s going to win the case or  not, until they have seen adequate “disclosure” of documents, witness statements  and expert evidence, enabling them to advise who is likely to have the best evidence and hence who will win or lose. The problem is that the cost of getting the case this far alone can be out of all proportion to the value of the case. Suddenly the issue is no longer just the liability for or ownership of the decombobulating sprocket, there is another issue – who is going to pay all the costs? Since the Jackson Reforms in 2013 there is far more pressure to mediate and a refusal to mediate can mean you don’t get all your costs even if you win. Nonetheless the number of mediations is still not rising to the levels required by any sort of rational approach to resolving court disputes. Why not?

At Focus we wonder this all the time. We think there are many reasons including:

  • The conflict has a life of its own, one or both parties cannot back down. Their irrational emotional right brain is engaged, they feel they simply must win, even though the costs make it a pointless and empty victory even if they win and they may lose but
  • Backing down is unthinkable. The identity of one or more participants is threatened by not winning or fighting
  • The adrenaline rushes of the amygdala in the brain is priming the fight, freeze or flee -a pre-historic response to conflict. The modern interpretation of fleeing or fighting the tiger can often be the ritualised combat of your chosen combat representatives, your lawyers
  • The costs may be insane but ‘It’s because I’m worth it’. This can often be the case in a divorce, where one party may want to punish the other with massive costs, drag out the fight, to try to get control of their resolution process (in their dreams, it has a life of its own). They may seek the fight for continuing connection, to delay the waiting void after it is over, the ritual of litigation may be an expression of their grief and loss, there are so many reasons.
  • A completely mistaken understanding of likely court adjudicated outcomes. For example, the divorce client arguing over a family pot of no more than £500,000, whose London lawyer had advised her that their hourly rate of £600 was worth it, as they would get her such a good settlement the extra money would pay the costs. Again, in your dreams! However, by the time the truth dawns, it is too late.
  • In some cases there may be a conflict of interest between the lawyers and their clients over costs. The National Audit Office reported on this in their report into Family Mediation in 2007. They found lawyers in some instances have a contrary interest to their clients to earn fees and that resolving a divorce by mediation was 75% quicker than going to court and cost a fraction of litigation. This isn’t true of many lawyers, who do refer to mediation, it is just that many don’t or leave it too late to save much.

So what can you do? Like many things the answer is both simple and hard to do:

  • Have a sense of proportion, work out the value of what you are arguing over. Set a budget for the costs of a sensible percentage of that figure and resist exceeding it. 10/20/30%, something rational.
  • Keep proposing mediation, even if you go to trial and lose, if the other person refuses mediation, you may benefit on a costs order. If you mediate you may well settle the case.
  • Pocket your pride, be ready to engage in resolution and move on with your life

Collateral Damage. The Hidden Cost of the Courts.

London Schools and Divorce in London

When a couple separate there are many issues to resolve. Most couples will want to provide as much stability as possible for their children at this uncertain time. One of the biggest problems in London is schools and catchment areas.

Separating in London can present additional problems compared to most other areas of the UK in terms of schooling, especially if the only option is to sell the family home. Down-sizing to another house could mean children being uprooted from schools and friends at a time when they most need their support network outside the home.

This year the number of 4 year old children applying for school places in London exceeded 100,000 for the first time. One in five children missed out on their chosen first place.

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The pan-London admission board received a record 102,441 applications for primary school places, an increase of three per cent last year.

The Evening Standard reported in November 2014 that “81 per cent received their first preference school, 92 per cent were offered one of their top three and 95 per cent one of their top six school choices”

The boroughs with the lowest numbers of children getting their first preference school were Wandsworth and Kensington and Chelsea, at 73 per cent and 61 per cent respectively.

Parents in Newham were most likely to get their first preference school, with 90 per cent being successful. In Barking and Dagenham and Havering 89 per cent of parents got their first preference school.”

It is common to read of situations where families living in the same street in London fail to get a school place in local popular schools, as they are as little as 500m outside the catchment area. This can be randomly unfair.

Focus London mediators will help you think through the options with regard to your family home and consider the implications for your children and their schools. In mediation you can consider these problems together and with our help work out which options are realistic, which provide the best outcomes for you and your children.

For more information email: info@focus-mediation.co.uk

50,000 children to benefit from child maintenance shake-up

Single and separated parents who have previously received no maintenance from their former partner could start receiving payments for the first time, as reform of the child maintenance system starts to affect existing cases.

As many as 50,000 children may be newly eligible for maintenance, the government has estimated, as a 3 year process of closing all existing Child Support Agency cases gets under way. A new advertising campaign to raise awareness was launched in September.

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Under sweeping reforms of the system the CSA has already stopped taking on new cases, with newly separated parents encouraged to make their own family based arrangements or use the new Child Maintenance Service instead.

Now in the next phase of the changes, the agency is beginning the process of closing its 800,000 strong historic caseload.

Initially the DWP is writing to 150,000 parents with details of when their case is due to close and advice about the next steps they should take. Although there is no need for anyone to act until they receive a letter, once parents receive notification of their closure date they are urged to consider their options. The case closure programme is beginning with so-called “nil-assessed” cases – those in which, because of the circumstances of the non-resident statement parent, no maintenance has been due. Because of this, parents may feel there is little point in responding to the letter they receive.

But because the parent’s circumstances may have changed since the initial assessment was made – plus the new statutory child maintenance is much more robust, using data from the tax authorities – it may be that maintenance becomes payable once a new assessment is carried out. Therefore all parents are encouraged to act.

Parents whose CSA cases are closed are encouraged instead to make their own family-based arrangements – with £14 million ploughed into projects around the country that help parents work together in the interests of their children. If that’s not possible, they can take advantage of support available from the new Child Maintenance Service.

Whichever route they choose, advice and support is available inline or on the phone from the new Child Maintenance Options Service – 080 098 809 880 or www.cmoptions.org.uk.

Whichever route they choose, advice and support is available inline or on the phone from the new Child Maintenance Options Service – 080098809880 or www.cmoptions.org.uk.

Bring Back the Calderbank – Stop Mad Litigation

A few years ago when people divorced they were encouraged to make offers to settle that were “Without Prejudice Save As To Costs”. These were known as Calderbank offers, after the name of the divorce case in which they were first made. The idea was you made these without prejudice offers that the judge would see at your appointment to try and settle the case – and they would try to use them to help people settle. There’d also be open offers that the judge would see. These would usually be very positional, by which I mean they’d be at the extreme end of what was likely to be the outcome, so were pretty useless – and we still have them.

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People are afraid to tell the judge what they’d really pay to settle in case s/he plays split the difference and they end up with an unfair settlement. So there’d be this hidden second tier of offers called the Calderbanks. These were always without prejudice, which meant the judge at trial didn’t get to see them and they couldn’t prejudice his or her decision-making. These Calderbank offers were a very serious matter. People had to put their money where their mouth was. If you put in a good Calderbank offer, then the other side was at risk of having to pay your costs from one month after the Calderbank offer was made. You’d usually get your costs if your Calderbank offer was better than the trail judge’s award – so if you beat the judgment, you got your costs. This really focused minds. Your lawyers would tell you if they thought you might end up having to pay the other side’s costs. It made people think and make sensible offers. It made a lot of cases settle earlier than they do now.

 These days there are no costs consequences to taking up an unreasonable position, as each side pays their own costs. Now people can just mouth any old rubbish, be as unreasonable as they like, yet still each side must normally pay their own costs. The total costs are paid from the assets before they’re split, so effectively you pay half of the total costs each – or half of each other’s costs. This can be a bit unfair if one party has very expensive lawyers or is unrepresented, but it’s just how it works. There is no incentive to be reasonable.

 In non family civil cases, people still have the equivalent of the Calderbank offer system. It does help prevent unreasonable negotiating positions. I think we should bring it back and didn’t agree with its removal in the first place, as it allows people to hold out for unfair negotiating positions with impunity. It forces the reasonable person to go to trial or settle for less than they should get, with no costs consequences. Mad!

Bloody mindedness

When people are hurt, they often like to hurt back.

An eye for and eye, a tooth for a tooth and all that. If s/he left me to go off with that bastard/bitch, they must suffer for it. They will suffer, I’ll make sure of it, even if I lose out too, it will be worth it!  Does anyone ever say that in mediation? Rarely if ever, but they may think it and take up inexplicable negotiating positions or prolong arguments over nothing. They can be very bloody minded over sorting the simplest things out. There are reasons for this, such as they cannot let go of the relationship, cannot leave the connection with their ex, they are desperate to ‘win’ so have to keep fighting, they want to have the ‘last word’ and/or their fury fuels the conflict and then the conflict finds an outlet in:

  • Quarrelsome solicitors’ letters setting out endless arguments about anything and everything, much of may be it immaterial to settling the important issues like who gets the house or is it sold, what happens about pensions and the maintenance? If people fight over silly things you know you are in trouble, so the food mixer or kettle is an indication they are dredging the bottom of the barrel and this is caused by their feelings, not the importance of the bottom of the barrel.
  • Putting forward extremely unfair positions that would make the other person lose out massively (punishment, ‘make them suffer’)
  • And worst of all, arguing through the children, using them as weapons and instruments of revenge, getting them ‘onside’ and trying to turn them against their other parent.
"Divorce Your Loved One With Dignity" Bob Willoughby © , Frank Sinatra, on the Warner Brothers set of Marriage On The Rocks, 1965

Bob Willoughby © Frank Sinatra, on the Warner Brothers set of Marriage On The Rocks, 1965

On the surface you have an argument, often translated into a legal narrative of this statute and these cases, versus a countering position and cases. That is the lawyers’ attempts to try and reduce the fighting into something logical, with rational arguments that can be explained and reasoned. Mostly the parties don’t give a damn about all that, what they mind about is getting back at the bastard/ bitch who has ruined their life. This isn’t every case by any means, but it is common enough to be classified as a type of case I think of as ‘Bloodymindedness’.

If you know someone who has embarked on a divorce in this manner and you really care about them, you won’t simply listen to their rantings, you’ll gently question some of their statements and turn some of their thoughts on their head. For example, you might ask what the costs of fighting have been so far and talk about the type of holiday, car or suchlike they could have bought for that instead. If they blame it all on the other person, you might ask them what they did to try to change the dynamic. If they have tried, and many will have done, you might observe it is very difficult to get two warring people to make peace simultaneously, as they often both try, but at different times and get a bad response.

The beauty of mediating your settlement, arrangements for the children, divorce, whatever, is you go off from your first session together with a shared action-plan and joint commitment to changing boundaries and behaving differently. You can develop functional separated boundaries, with some rules you put in place about what ever is causing difficulty. Solicitors’ letters will not accomplish that. Mediation can turn things around and put you on a better path, people need to understand about that possibility, because it is game changing, and thank goodness for it.

Think of it as an escape hatch from misery for families who are splitting up.

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