Legal Service Payment Orders: An Alternative Solution
Financial constraints can often stand in the way of clients seeking legal representation, especially in light of the recent high inflation and monthly interest rate increases in the UK. Traditional options such as litigation loans, commonly used to finance legal services, may not always be accessible, especially for clients who do not have sufficient assets in their own name to use as collateral. In such circumstances, Legal Service Payment Orders (“LSPOs”) can provide a viable alternative for those who might otherwise struggle to afford legal representation.
LSPOs were introduced under ss 22ZA and 22ZB of the Matrimonial Causes Act 1973 (MCA 1973), providing the court with the power to make an order requiring one party to make payments to the other party for the purpose of obtaining legal services. The primary objective of an LSPO is to level the playing field by ensuring that spouses have equal access to legal representation through proceedings, regardless of the fact that one of them may be in a significantly stronger financial position than the other.
The leading authority on LSPOs is Mostyn J’s decision in Rubin v Rubin [2014] EWHC 611, where he outlined the guiding principles, both substantive and procedural, for handling LSPO applications. In a recent development in the case of HAT v LAT [2023] EWFC 162, Mr Justice Peel, referencing Mostyn’s principles in Rubin, made an LSPO in favour of the applicant (as well as an order for maintenance on an interim basis), emphasising the need to level the playing field which would otherwise lean heavily in the respondent’s favour. This was despite the fact there had been a delay of circa 30 years between the parties separating and the applicant bringing a financial claim.
It is essential to seek independent legal advice regarding the merits of an LSPO application. However, as the funding of legal costs continues to be a difficult hurdle to overcome for many, especially at a time when litigation loans are becoming increasingly hard to obtain, alternative options such as these are an important consideration.