Estranged couples who run up fortunes in lawyers’ bills when fighting over money in divorce courts are not necessarily profligate, a specialist lawyer has suggested.
Solicitor Toby Hales said that people who think an ex-partner is hiding assets can find themselves running up bills through no fault of their own.
Mr Hales, who is based at law firm Seddons, has offered explanations after a judge told an estranged couple embroiled in a big-money fight in the Family Division of the High Court in London they were spending “crazy” amounts on lawyers.
Barbara Cooke, 57, and Michael Parker, 54, directors of a firm which supplies towels to hotels, had run up legal bills of about £1.5 million arguing about dividing an asset kitty possibly in the region of £10 million, Mr Justice Holman heard.
Ms Cooke told the judge at a preliminary hearing last week how she thought that Mr Parker may have millions in assets he was not disclosing.
However, Mr Justice Holman said the litigation had lost “all sense of costs proportionality”.
Other judges have raised similar concerns in other cases.
Mr Hales suggested the family justice system could be to blame.
“It is not uncommon that one party to a divorce believes that the other is hiding or undervaluing their assets,” he said.
“These cases often end up being the longest and most expensive.
“There are two glaring reasons for this.
“Firstly, the family justice system has not evolved a quick way of dealing with these disputes.
“Questions of fact can only be resolved at the trial.
“The parties are therefore left hanging until the very end, when everyone has spent a vast amount of money.
“Secondly, and more seriously, although the court forms warn of the penalties for non-disclosure, in reality these penalties never come to pass.
“People who are found to have lied about their assets are not punished except sometimes by having to pay a contribution to the costs of the other party.
“People who lie under oath are not charged with perjury – much to the astonishment, often, of their ex-spouses.
“So, there is no deterrent, no punishment and no disincentive.
“People know that to fight over issues of disclosure will, as in this case, cost huge amounts of money.”
He added: “Cases like this happen due to a combination of an unregulated market, delays in the court system and the feeling that there is no alternative.
“The cost of solicitors continues to rise. Many family lawyers are extremely conscientious in advising their clients to behave moderately and save money on legal fees, but others are not.
“Couples must be made aware of alternative means of resolving disputes, such as family arbitration, in which a divorcing couple can obtain a binding resolution of their financial affairs in a matter of months.”