M (H) v M (S)
| Jurisdiction | Ireland |
| Judge | Mr. Justice Noonan |
| Judgment Date | 20 November 2015 |
| Neutral Citation | [2015] IEHC 727 |
| Court | High Court |
| Date | 20 November 2015 |
[2015] IEHC 727
THE HIGH COURT
BETWEEN
AND
AND
Family – The Judicial Separation and Family Law Reform Act 1989 – The Family Law Act 1995 as amended by the Family Law (Divorce) Act 1996 – Taxation of costs – O. 99, r. 38 (3) of the Rules of the Superior Courts – S. 27(3) of the Courts and Court Officer's Act 1995 – Review
Facts: The respondent sought review of the ruling of the Taxing Master in relation to the applicant's solicitor's bill by way of an application under o. 99, r. 38 (3) of the Rules of the Superior Courts.
Mr. Justice Noonan dismissed the application of the applicant under o. 99, r. 38 (3) of the Rules of the Superior Courts. The Court held that s. 27 (3) of the Courts and Court Officer's Act 1995 conferred all attributes of a special tribunal who had special expertise in legal costs assessment and the power of the Court to interfere with the decisions of the Taxing Master was limited to the extent of an error as to the amount of allowance or disallowance that led to injustice. The Court found that there was no evidence justifying that the decision made by the Taxing Master was unjust and inapt.
1. This matter comes before the court by way of application by the respondent pursuant to O. 99 r. 38 (3) of the Rules of the Superior Courts for a review of the taxation of the applicant's costs herein.
2. This matter arises out of family law proceedings brought by the applicant wife against the respondent husband. The applicant originally instructed Mr. Dermot Simms solicitor to represent her in judicial separation proceedings which commenced in 2007. At that time Mr. Simms was employed in the firm of Messrs. Rutherfords solicitors. He subsequently left Rutherfords in 2008 to set up his own practice and thereafter he continued to represent the applicant. The case came on for hearing before MacMenamin J. in December 2009 and it was heard over a period of eleven days between then and May 2010. Central to the proceedings was the question of asset division and by any standards, $these were very substantial indeed and the arrangements surrounding them extremely complex.
3. MacMenamin J. delivered his judgment on the 29 th of July 2010 and in the context of this application, it is only his determination in relation to costs that is relevant and in particular, two aspects of that determination. First, at para. 57 of the judgment, the court said:
"Second, it is estimated that the applicant's legal costs by the conclusion of this case will be a multiple of the respondent's by a factor of four. The Supreme Court has commented on the level of costs in cases of this type. Very substantial sums of money are involved here as costs. Other than having received a broad outline from her solicitor at the outset of the proceedings, the applicant took no steps to ascertain her own potential financial exposure as to costs. She is not to be criticised for placing herself 'in the hands of her lawyers', but nowadays it might be expected that any client would seek some form of ongoing information as to the costs which primarily she would be incurring. In this context I do not think there was any real justification for the bringing of two interlocutory motions, one seeking to bar the husband from the family home. I do not think such a radical measure was warranted."
4. The second part of the judgment that is relevant is to be found at paragraph 84:
"I turn finally to the question of costs. This is an ample resources case. As pointed out in W. v. W. in such cases a court may well be reluctant to award costs. The circumstances in this case differ, to some degree. There was late provision of financial information from the husband. This added to the length of the case by a factor of three or four days. The husband chose not to retain an accountant. This again would have shortened the case and reduced costs. I do not think these factors should be ignored - equally I do not think the husband should be placed in a position where he would be exposed to the entirety, or even a moiety of the wife's costs in an ample resources case I will direct that the husband will pay 20 per cent of the estimated figure for the wife's costs as identified by counsel for the wife. This figure is confined to the costs of the hearing before me."
5. The formal order of the court was made on the 12 th of November, 2010, and paras. 8 and 9 are material:
"[8] An order directing the respondent to pay to the applicant the sum of €100,000 being 20 per cent of the estimated costs as provided to the court by counsel for the applicant, from which the respondent will be entitled to deduct the costs due by the applicant to him at para. 9 of this order.
[9] An order directing the applicant to discharge the respondent's, costs of two interim motions such costs to taxed in default of agreement. The respondent shall be entitled to set off the costs payable by the applicant to him as set out at para. 8 above."
6. The respondent's costs of the two motions in question were taxed in the sum of €18,894.07 leaving a sum of €81,105.93 due to the applicant. This sum has not been paid by the respondent.
7. Two further motions were subsequently brought by the applicant and respondent respectively which resulted in a further judgment of MacMenamin J. delivered on the 22 nd of July, 2011. On the issue of costs, MacMenamin J. said (at page 4):
"[7] I think there is force in what Mr. M.. says in relation to whether he has a genuine interest in the question of the applicant's legal costs. I do not intend to express any view, at this stage, as to the whether the letter which Mr. S. sent the applicant constitutes a "s. 68 letter" properly so called. It will be recollected that Mr. M. submitted that the letter was unspecific and did not identify any figures. I think it was legitimate for him to submit that the extent of the applicant's costs remains a legitimate concern for him in the event of the parties ultimately seeking a divorce. The extent of the costs incurred may impinge on the question of whether adequate provision has been made for the applicant and the (?). Thus, I am directing that the applicant's costs will be taxed, and that the respondent will be permitted to retain a cost drawer to make submissions to the Taxing Master in relation to the items of costs identified in the bill of costs which will be submitted by the applicant's solicitor (the problem of legal privilege has been raised). Clearly, the respondent will not be entitled to have access to any privileged documentation in the applicant's solicitor's legal files. But such situations are very common and are dealt with as a matter of routine by the Taxing Master. I will take Mr. M's. undertaking that he will pay for the cost of the taxation and not seek access to any privileged documentation. I will point out that such costs can be significant but I am sure he has taken advice on this question. Nonetheless, I think he has legitimate interest in seeking to ensure that the costs are minimised. The applicant will have to bear in mind the status of any s. 68 letter in the context of whether or not there is to be a solicitor/client aspect to her legal bills. I say this in light of the fact that the applicant's legal bill currently stands at something in excess of €570,000. This is a very large sum of money indeed. By now, the bill may be even greater. I recognise that the applicant feels that the respondent is a 'control freak' and this is yet a further aspect of his controlling nature. However, the truth of the matter is that he does have a legitimate financial interest in these questions." [sic]
8. The formal order of the court provided in that regard as follows:
"[8] That the respondent do retain a costs drawer within one week of the date of perfection of the within order that such costs drawer identify himself/herself to the applicant's costs drawer within ten days of the date of perfection of the within order and that both costs drawers do apply to the Taxing Master for an early date for taxation.
[9] That the applicant's costs of the substantive hearing and preliminary motion be taxed and that the respondent's costs drawer will be permitted to make submissions to the Taxing Master in relation to the items of costs identified in the bill of costs which will be submitted by the applicant's solicitor.
THE COURT DOTH NOTE
The undertakings of the respondent…
That the respondent will pay the costs relating to the taxation of the applicant's costs and will not seek access to any privileged documentation…"
9. There then commenced in 2011 a very lengthy taxation process, which is still ongoing, in which the respondent seeks to challenge the applicant's solicitors bill of costs on a number of grounds. The Taxing Master delivered four written rulings on the 12 th of December, 2011, the 16 th of July, 2012, the 11 th of October, 2012, and the 29 th of May, 2014. The taxation was in effect "contested" between legal costs accountants retained on behalf of Mr. Simms and the respondent respectively.
10. The Taxing Master's first ruling was in relation to a preliminary issue which arose at the outset of the taxation and concerned two points. The first was whether the respondent should be entitled to challenge each and every item in the applicant's solicitor's bill in circumstances where the applicant herself approved those items or was the respondent confined to dealing with only the...
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