8. Can maintenance pending suit include litigation funding?

8. Can maintenance pending suit include litigation funding? 

Yes. In appropriate cases, interim support may include litigation funding (provision for legal costs) to cover the legal fees of proceedings including main suit, children’s arrangement and finance. The courts have determined that "maintenance" is a broad concept extending beyond daily living expenses to include the "most urgent and pressing need" of a financially dependent spouse: the ability to pay for legal representation to vindicate their rights. 

This is intended to ensure fairness and “equality of arms” where one spouse has the financial ability to conduct the litigation and the other does not. 

The applicant will normally need to show that he or she cannot reasonably fund legal representation by other means, for example through: 

• available assets; 
• borrowing; 
• legal aid; 
• assistance from others; or 
• other realistic sources of funding. 

This is often referred to as the Currey test. 

The court will not order litigation funding easily. The party applying for such funding must produce sufficient evidence to show why the above conditions are met and the amount sought is reasonable and necessary. 

In practice, the applicant should provide a detailed breakdown of the expected legal costs. This should include the costs already incurred and the costs likely to be incurred in the future. The estimation is recommended to be made in the form similar to Form H, setting out the estimated costs of solicitors and counsel in a clear and itemised manner. Any estimate of future costs should have a reasonable basis, rather than being a general or unsupported figure. 

The court will also consider whether the amount claimed is proportionate. This means that the proposed funding should be reasonable having regard to the nature and scale of the proceedings, as well as the value of the family assets disclosed by the parties. 

Where litigation funding is granted, the receiving party will usually be required to give an undertaking to the court that the money will be used only for legal costs connected with the proceedings, and the court may also order the money be directly paid to the application’s solicitors firm. 

Litigation funding awards usually take the form of periodical payments and are intended to fund the applicant only up to the Financial Dispute Resolution (“FDR”) hearing. If the FDR is unsuccessful, the court is at liberty to extend the litigation funding order to cover the costs up to the final trial upon further application.