Stephen Murray discusses The Family Procedure (Amendment) Rules 2020 – The latest amendments to the FPR 2010 will come into force, as far as the provisions referred to below are concerned, on 6 July 2020. They contain one amendment of general application and two amendments specifically related to financial remedy work which may be of interest to practitioners.
Unilateral (or “secret”) communications with the Court (New FPR Rule 5.7)
The days when a party can send emails or other communications directly to the court/judge without copying in the other side are now, at long last, hopefully over. Such a practice, (which this author has long regarded as unprofessional, but which has become increasingly commonplace (especially in cases involving LIP)) is now prohibited by the insertion of a new FPR Rule 5.7 which provides that:-
Communications with the court
5.7.—(1) Any communication between a party to proceedings and the court must be disclosed to, and if in writing (whether in paper or electronic format) copied to, the other party or parties or their representatives.
(2) Paragraph (1) applies to any communication in which any representation is made to the court on a matter of substance or procedure but does not apply to communications that are purely routine, uncontentious and administrative.
(3) A party is not required under paragraph (1) to disclose or copy a communication if there is a compelling reason for not doing so, and provided that any reason is clearly stated in the communication.
(4) A written communication required under paragraph (1) to be copied to the other party or parties, or their representatives, must state on its face that it is being copied to that person or those persons, stating their identity and capacity.
(5) Unless the court directs otherwise, a written communication which does not comply with paragraph (4) will be returned to the sender without being considered by the court, with a brief explanation of why it is being returned.
(6) In addition to returning a communication under paragraph (5), where a party fails to comply with paragraph (1) the court may, subject to hearing the parties, exercise its case management powers under Part 4.
Points to Note:
(a) The requirement to copy in one’s opponent to any communication to the court only applies to communications on a matter of substance or procedure and not to the humdrum inconsequential matters that are “purely routine, uncontentious and administrative”. It will be interesting to see whether this provides a professed “loophole” for the unscrupulous and results in contentious debate about the categorisation of such communications
(b) The rules do not specifically require the copying in to be simultaneous with the communication to the court: but surely, as a matter of common sense, that must be the intention.
(c) Any communication to the court must state on its face that it is:
(i) being copied to the other side; and
(ii) identify
• to whom; and
• in what capacity
the communication is being copied.
(d) Failure to comply with the requirement for the communication to contain a declaration that it has been copied to the other party:
(i) will result in the court returning the communication to the sender without considering its contents; and
(ii) may result in the court exercising its case management powers under FPR Part 4 – but only after hearing the parties.
What case management powers the framers of the new rules had in mind is not clear. None of the specific case management powers referred to in FPR rule 4.1(3) seem applicable other than perhaps “(l) exclude an issue from consideration”.
Open Offers for Financial Remedy Cases (New FPR Rule 9.27A)
The days when the parties could keep their open position “up their sleeves” until shortly before the final hearing (14 days before the final hearing for the applicant and 7 days thereafter for the respondent in accordance with FPR rule 9.28) will be replaced by a requirement that each party state their open position 21 days after the date of the FDR appointment (unless the court directs otherwise).
The significance of this is, of course, that open offers to settle are admissible and relevant to the issue of costs under FPR rule 28.3(7)(b) as justifying a departure from the normal “no order” principle. Consequently, the sooner in the litigation process they are made – then the greater the amount of costs that may be payable under any order which directs that such costs shall be recoverable from the date upon which an open offer is made.
The intention is clearly to require the parties to take stock and advance sensible open positions at the earliest opportunity following a failed FDR hearing – rather than simply allowing the file “to go to sleep” until the usual flurry of activity, often many months later and just before a final hearing.
The detailed provisions of the new rule are set out as follows:-
9.27A.—(1) Where at a FDR appointment the court does not make an appropriate consent order or direct a further FDR appointment, each party must file with the court and serve on each other party an open proposal for settlement—
(a)by such date as the court directs; or
(b)where no direction is given under sub-paragraph (a), within 21 days after the date of the FDR appointment.
Cases where, for whatever reason, there is no FDR are caught by sub-paragraph (2) which provides:
(2) Where no FDR appointment takes place, each party must file with the court and serve on each other party an open proposal for settlement—
(a)by such date as the court directs; or
(b)where no direction is given under sub-paragraph (a), not less than 42 days before the date fixed for the final hearing.”.
Curiously, FPR Rule 9.28, (which requires open proposals from the applicant not less than 14 days before the date fixed for the final hearing and 7 days thereafter in the case of the respondent) remains in force. It would seem therefore that the parties are under a duty to revise and, if necessary, amend their open proposals shortly before the final hearing.
There is a consequential amendment to the directions which the FDR judge is required to give under FPR Rule 9.17 (9) namely – as well as giving directions for (a) for filing evidence and up to date information and (b) fixing a final hearing date – to give a direction as to
“(c) any necessary directions for the filing of open proposals for settlement under rule 9.27A or rule 9.28”.
Costs Estimates (Substituted FPR Rule 9.27)
Future Costs
As from 6 July 2020, the parties will be required to file and serve not only a Form H setting out their costs incurred to date (as they do now), but also:-
• an estimate of their future costs to the next stage of the process (i.e. to the FDR at an FDA hearing and to the final hearing at an FDR hearing); and
• in the case of a final hearing, each party must file and serve not less than 14 days before the hearing “full particulars of all costs in respect of the proceedings which the filing party has incurred or expects to incur”.
The costs estimates must include confirmation that:-
(a) they have been served on each other party, and
(b) they have been discussed with the client.
Recitals to Orders
Orders will be required to contain a recital recording each party’s estimate of future costs.
Statements of Truths
Practice Direction 9A will be amended to require costs estimates to be accompanied by a Statement of Truth.
Production at Court
Notwithstanding that the rules require the costs estimates to be filed with the court – each party must bring a copy of any estimate of costs filed and served to the hearing itself.
Failure to Comply
Any failure to comply with these provisions must be recorded on the face of the order and the defaulting party must be ordered to file and serve the costs estimates within 3 days of the hearing (or such other time as directed by the court)
The detailed provisions are as follows:
9.27
(2) Not less than one day before the first appointment, each party must file with the court and serve on each other party an estimate of the costs that party expects to incur up to the FDR appointment if a settlement is not reached.
(3) Not less than one day before the FDR appointment, each party must file with the court and serve on each other party an estimate of the costs that party expects to incur up to the final hearing if a settlement is not reached.
(4) Not less than 14 days before the date fixed for the final hearing of an application for a financial remedy, each party (“the filing party”) must (unless the court directs otherwise) file with the court and serve on each other party a statement giving full particulars of all costs in respect of the proceedings which the filing party has incurred or expects to incur, to enable the court to take account of the parties’ liabilities for costs when deciding what order (if any) to make for a financial remedy.
(5) A costs estimate filed and served in accordance with paragraph (1), (2) or (3) and particulars of costs filed and served in accordance with paragraph (4) must include confirmation—
(a) that they have been served on each other party; and
(b) in the case of a party who is legally represented, that they have been discussed with the party on whose behalf they are provided.
(6) Each party must bring to a hearing or appointment a copy of any estimate of costs filed and served in accordance with paragraph (1), (2) or (3) and any particulars of costs filed and served in accordance with paragraph (4).
(7) The amount of—
(a) a costs estimate filed and served in accordance with paragraph (1), (2) or (3); and
(b) particulars of costs filed and served in accordance with paragraph (4),
must be recorded in a recital to the order made at the hearing or appointment before which the estimate or particulars were filed or served.
(8) If a party fails to comply with paragraph (1), (2), (3) or (4)—
(a) this fact must be recorded in a recital to the order made at the hearing or appointment before which the costs estimate or particulars of costs should have been filed and served; and
(b) the court must direct that the relevant costs estimate or particulars of costs must be filed with the court and served on each other party within three days of the hearing or appointment or within such other time period as the court directs.
Stephen Murray is a member of the Family Department at 18 St John Street Chambers who specialises in high net worth financial remedy cases. If you have any queries about this or any other related subject, please feel free to contact us on our usual contact details and we will be delighted to assist you.