Legal Services Payment Orders
- Case: DR v ES & Ors (Further LSPO Application) [2026] EWFC 15.
- The decision provides guidance on when the court may grant a further Legal Services Payment Order (LSPO), including funding for historical costs already incurred.
Background
- The parties married in 2008 and separated in 2021.
- Financial remedy proceedings began in September 2021 and were heavily contested.
- The asset base was substantial, involving interests in two property holding companies.
- The wife had already received three LSPOs totalling more than £1.7 million.
- Before the final hearing, the wife sought a further LSPO of about £720,000 for unpaid legal fees and future costs.
- Her solicitors stated they would cease acting unless arrears were paid.
Husband’s Position
- The husband accepted that some further funding might be justified.
- However, he argued that the wife’s solicitors had exceeded the previous court-approved budget at their own risk.
Court’s Decision
- The court awarded a further LSPO of £560,120:
- £154,570 for costs already incurred.
- £405,550 for future costs up to the final hearing.
- The court held that some payment of historical costs was justified because otherwise the wife risked losing legal representation.
- That outcome would have undermined equality of arms, particularly as the husband continued to fund his own lawyers.
Important Points from the Judgment
- An LSPO is not a blank cheque.
- Court-approved budgets remain important and should generally be followed.
- However, the court may depart from a strict budget where fairness requires it.
- The court considered:
- the complexity of the litigation,
- continuing disclosure issues,
- the work needed to prepare for trial,
- and the conduct of the husband and his parents.
Payment Arrangements
- The husband was ordered to pay the LSPO by instalments.
- The court also imposed restrictions on payments to his own advisers to preserve fairness between the parties.
Practical Significance
- The case confirms that, in appropriate circumstances, an LSPO can cover both future costs and part of an overspend on past costs.
- The central consideration is whether further funding is necessary to ensure the financially weaker party can continue to litigate effectively and fairly.
Key Takeaway
- Costs budgets matter, but they will not be applied rigidly if doing so would deprive one party of proper representation and undermine equality of arms.
