How litigation dollar-for-dollar orders are made in the Family Court

The Family Court has power to order that a party in a litigation can pay to the other party their legal costs in the proceedings, as it considers appropriate. These are known as litigation funding orders and are made under three powers in the Family Law Act 1975 (Cth), being s 74, s 79 and 80, or s 117. The purpose often of ordering a litigation funding order is to ‘level the playing field’ in the proceedings, where there is a disparity of resources between the parties and one party has available to them the majority of the resources of the parties to fund the litigation.

A dollar-for-dollar order is an example of an interim order which is made that usually lasts until the trial.

In the case of Shelbourne, a Family Court judge made a dollar-for-dollar order three months before a trial in which the Husband was ordered to pay the Wife’s solicitor a sum equal to any amount he thereafter paid to his lawyers, including barristers.[1]

What the Husband then did is that he didn’t pay his lawyers any amount, and so there was no requirement for him to pay the Wife’s lawyers any amount and she was paid nil.

It ended up that the Husband paid $152,000 on legal fees up until the time of trial and the Wife paid $264,000 of legal fees.

At the trial, the trial judge ordered that the dollar-for-dollar order be extended so that it would capture the payments of invoices in respect of all fees and disbursements incurred from the date of the dollar for dollar order until the delivery of judgement even if they were invoiced and paid after the delivery of judgement.

The Husband sought a discharge of the dollar-for-dollar order in an appeal to the Full Court of the Family Court.

The Full Court agreed to discharge the dollar-for-dollar order made by the trial judge because it held that the order made by the trial judge was in effect a costs order and ought to have been taken into consideration in determining the final property adjustment.

It is important for clients in family law litigations to understand the impact of costs and their ability to fund proceedings at the outset and what a court might do in relation to litigation funding and costs orders.

If you need advice in relation to family law litigation, please contact Rowan Skinner & Associates Lawyers to discuss your issue.

[1] Shelbourne & Shelbourne [2019] FamCAFC 196