||There is insufficient pressure placed on an unwilling litigant to adopt a reasonable position in a needs case under the current rules. This frequently ends up in the position whereby a client running a needs case faces a disproportionate costs burden, thereby further increasing their needs to artificially reducing their housing etc. capacity.
||Cases more likely to settle rather than proceed to a Final Hearing unnecessarily.
I had a case where an offer made, it was rejected. The Court ordered less to the other party and in fact I was fortunate as the Judge made a costs penalty of £1000. Judge thought the other party should have settled earlier in view of the values and not proportionate to the costs incurred.
||I agree with CWG that the removal of Calderbanks in 2006 has resulted in practice in more cases litigating to final hearing. The current open offer costs regime has not worked in the way it was hoped it would. In practice, particularly at DJ level in the Family Court, costs orders are very difficult to get even where one party has failed to negotiate reasonably. I am not optimistic that the change in May 2019 to PD28A will have much of an impact. Currently, the general “no order” principle dominates. Parties’ open offers are their “best hope”. If you make them more generous and then try to row back from that generosity at trial, judges tend to see the earlier more generous offer as your starting point. Judges rarely make awards at the level of the parties’ open offers. Often they will “split the difference”. This is despite the Moor J judgment in MAP v MFP  EWHC 627 (Fam). WP offers enable parties to make improved proposals that should encourage earlier settlement, but the fact that they cannot subsequently be referred to in relation to the issue of costs means that there is no effective disincentive for an unreasonable litigant “rolling the dice” and taking a chance at trial in the confident knowledge that a costs order is unlikely. This is a particular issue where one party is represented and is trying to settle and the other is a litigant in person.
I agree with the CWG that the no order general rule should be retained and we should not have a Part 36 type regime. I also believe that the current r9.28 should be amended to require open proposals much earlier, perhaps shortly after FDR, rather than only 14/7 days before trial.
I understand the concerns about Calderbanks undermining carefully crafted judgments, but believe that is looking at things through the wrong end of the telescope. The objective is to encourage earlier settlement. If that means in some cases that judges have to re-think in order to factor in costs, that’s a price worth paying if fewer cases get to that point. Further, I agree with the CWG that we should not return to the previous mandatory and over-prescribed pre-2006 regime. Judges should simply be able to take account of WPSAC offers as one of the r28.3(7) factors. There would still be wide discretion, but the key point is why should a litigant who genuinely attempts to settle through reasonable offers that are more generous than the position taken at trial be financially prejudiced by having to bear a costs burden that could have been avoided.
Finally an example from a hypothetical maintenance case. The applicant H applies to terminate a term maintenance order after losing his job. His open offer is to terminate it without any compensating capital payment because Respondent W has sufficient income and savings to adjust without undue hardship. W on the other hand argues that he could and should get further work at a level that would enable him to continue the maintenance for the remaining 5 years of the term and that this should be capitalised at £300,000. The difference between the open positions is therefore that £300,000. At trial the judge agrees that H should not be taken to have an earning capacity at the level argued by W, that she does have sufficient resources to adjust and that it should be terminated. However, the judge feels that some compensating payment is justified and makes an award of £100,000. There is no order for costs because although the decision is much nearer H’s open offer than W’s it could be said that the result was a “draw”.
But what if H had made a WPSAC costs offer 6 months earlier at £100,000, with each party incurring £50,000 between then and trial? His open offer was completely arguable on the facts and law, but he was prepared to try to settle by offering a sum that was significantly more generous than his arguable open position. He didn’t want to offer £100,000 or even £50,000 openly at that stage even though he had been advised that under MAP v MFP his open position at trial could be that W should receive nothing, because of the risk the judge would not be able to “unsee” the much higher offer and take it as an admission that he should be paying at least that. What if that WPSAC offer had been amended to £75,000 after FDR in line with the guidance given by the FDR judge (the £25,000 difference representing the costs incurred by him between FDR and final hearing)? Currently these offers cannot be seen by the trial judge. H pays the sum he offered 6 months ago but it has cost him £50,000 that could have been avoided. If his Calderbank offers could be taken into account the judge could decide whether a costs order would be fair. It wouldn’t be mandatory, but because it is not a needs case and the judge has already found that W has sufficient capital and income to pay it without undermining the order, surely it would be fair in these circumstances to give H some if not all of the costs he has incurred unnecessarily?
In short, the reintroduction of Calderbank offers as a simple additional factor in determining costs orders in financial remedy proceedings will promote settlement.
||It would be of enormous benefit by encouraging parties to negotiate sensibly with a view to reaching agreement without the need for a costly and damaging contested hearing. In my 30 plus years of experience as a family lawyer specialising in financial cases I have found that the removal of Calderbank offers has resulted in cases being litigated to the bitter end much more frequently.
||My experience (30yrs) of using Calderbank offers was that they did provide a focus that could result in settlement. I appreciate and support the emphasis on negotiation and settlement without the threat of cost orders, but we increasingly find the cases we are dealing with are those not suitable for ADR, so contentious at the top end. I have several experiences of cases where the party has refused a WP offer and then failed to beat it at a final hearing – at the moment that entrenched litigious party has no real consequences to face.
||A good offer should be taken into account as otherwise litigants could drag things out.
||I am proud to say that only a very small percentage of the cases in which I am involved move beyond an FDR. In the very small number of intractable cases which do not settle at or shortly after FDR, I am confident that the rule change proposed would assist with settlement before a final hearing. The possibility of a costs order being made as a consequence of “without prejudice save as to costs” correspondence is a powerful inducement to settle to the most difficult of clients.
||The restoration of Calderbank offers with appropriate safeguards provides greater incentive for settlement.
It also reflects the importance of obtaining good legal advice which Resolution members can provide.
The difficulty nowadays is that many cases are ending up at trial because there is no incentive to settle. The proliferation of litigants in person is partly responsible for this malaise.
There needs to be more teeth to the situation and parties should be disincentivised to go to trial.
A good Calderbank offer can be made once the merits and quantum of a case are properly known.
I believe there is also merit in looking at the introduction of offers similar to Part 36 CPR in appropriate situations. Such offers are made in TOLATA cases involving domestic property situations.
||As a family practitioner I am facing a number of case where litigants in person or people with legal representation who simply want to punish their ex spouse are taking a very unreasonable approach i.e. I have a case where a wife has made an offer to buy out the husband using the formula provided by the Judge in judgment and he refuses to do so because “she won’t let him keep a property”. Husband cannot release her from the mortgage which is why she can’t let him keep the property, if he could she would be more than happy to allow him to keep the property. We are now having to go back to the court incurring unnecessary costs for the wife who has made a legitimate and fair offer. I have another case and because the wife owned the property before and the parties received a discount under the right to buy scheme she does not consider the husband should get anything. He paid the rent arrears to enable them to purchase the property and paid the mortgage. She is a litigant in person and is refusing to negotiate. It is a needs case and her case is he arrived with nothing so should leave with nothing, notwithstanding his contribution towards the property during their 10 year marriage. My client cannot afford to litigate past a FDR and could face conceding and never being able to get a mortgage again as wife cannot release him and is refusing to sell. Either that or his is going to spend all of his award just getting the house sold and his name off the mortgage but not having a deposit. Both of the other sides in these cases are not negotiating reasonably or responsibly they just want to punish their ex-spouses.
||The current situation is untenable. I have many examples of opposing parties ignoring offers and just proceeding to trial.
||I agree that the change in rules to get rid of Calderbabks has meant less engagement on settlement between FDR and final hearing. It has also removed a tool in the solicitor’s tool box that enabled us to get clients to focus more on settlement and making/ accepting an offer in the bracket as there is now no real cost risk.
||It promotes settlement and exposes those who make no offers and simply run up costs.
||It encourages parties to put forward and consider sensible offers, and urges solicitors to give pragmatic and constructive advice with a view to bringing the matter to a conclusion and avoiding the additional costs and stress of court proceedings for the parties.
||There are cases where the assets are not great yet one party litigates in the full knowledge that the other party will incur considerable legal costs that cannot be recovered and they refuse to negotiate and take the case through to a Final Hearing incurring the costs of 3 court hearings!
It is particularly unfair when the party that refuses to settle is unrepresented ( and therefore has no legal costs) and the other party has legal costs to pay which are only run up because of the LIP being unreasonable.
||Calderbank offers should be only one of the various discretionary criteria in whether an adverse costs order should be made. They should not be the sole determinate however as they often were in the past.
Having a discretion would mean that in needs cases the impact of an adverse costs order would not run the proverbial ‘coach and horses’ through the Judge’s carefully constructed solution. In non-needs cases then the court would probably have greater latitude to make such costs orders where a Calderbank offer had been matched/beaten.
Calderbanks encourage sensible negotiation/settlement engagement. Under the current rules, where open offers are usually made late in the day and unpaid costs sit happily as a liability on the asset schedule, parties have licence to drive on to final hearing without any sanction on unreasonableness.
||There are still many instances where parties refuse to negotiate reasonably, or at all, knowing that rarely are cost orders made in financial remedy proceedings. Many solicitors (and their clients) seem reluctant to show their hands at an early stage, often pursing requests for further information/valuations rather than grappling with the issues. The Calderbank process was not perfect but helped people to focus on settlement.
||Calderbanks were an effective negotiation tool often leading to resolution. They focussed the mind of both client and practitioner.
Without anything similar in place settlement has become rarer and often later in the process.
It has also led to some lawyers not properly and fully setting out their cases earlier on.
||Calderbank offers under the old regime were often a blunt instrument, but I firmly believe the pendulum has now swung too far in the opposite direction.
I have seen parties arguing for clean breaks where young children are concerned safe in the knowledge that if there is no litigation misconduct my client will be put to great expense.
||Too many solicitors and clients unwilling to focus on attempts to settle. Old Calderbanks used to work in my personal experience.
||The current system gives no encouragement to sensible offers being made and a change would encourage and assist in bring forward realistic offers and agreed settlements. Parties don’t at times seem to mind wasting their own money on costs but the possibility of an order for costs being made against them would cause concern.
||In the past this was a good incentive for parties to settle. Since the loss of Calderbank offers parties carry on knowing there is little risk of costs orders no matter how unreasonable their stance.
||Often parties will simply take it as far as they can (final hearing) as there are no/little consequence for doing this. It would be much more helpful in focusing the parties’ minds if there were costs consequences.
||Whilst this type of correspondence is no longer relevant, if a party is not engaged in trying to resolve the finances and is coming up with ridiculous, and unfair proposals, then their conduct should be brought to the attention of the court and costs sanctions made against them.
||Legislation and case law relating to financial remedy proceedings means it would in my view be artificial and unfair to point to a Calderbank offer to determine who has “won” and who has “lost” the case and I agree with the consultation note in this regard. However in entirely disregarding Calderbank offers and this part of the history of the case in determining whether to award costs often results in great unfairness to (usually one) party. I agree especially with para 12d of the consultation note and indeed this is often my experience.
It is correct that the vast majority of litigants will put only their best case forward in open proposals for fear of tainting the Judge’s perception of the case ahead of the final hearing. It is usual for without prejudice offers to have been made, which are much more realistic, in the build up to the final hearing but which cannot then be referred to even on the question of costs and this seems unjust especially when open proposals are able to be referred to but are often unreflective of the parties’ approach to the litigation as a whole.
In cases where there is a substantive history of sensible offers having been made which are unreasonably rejected by one party giving rise to the necessity of a final hearing (and all of the cost which that incurs) it seems right in principle that the court should be able to consider that on the question of costs.
I do foresee a difficulty in establishing where a party has behaved “unreasonably” in rejecting without prejudice offers such that a costs liability would potentially arise. It is likely that guidance would be needed in this regard.
In addition I believe consideration should be paid to how the Judge’s indication at the FDR hearing could be treated in relation to costs. It is not usual but also not especially uncommon to find that a party will pursue litigation to final hearing on the strength of the Judge’s indication at FDR, only to find that at the final hearing the Judge makes a substantially different award leading the other party to make an argument for costs (especially as the party taking guidance from the FDR indication is likely to have then made an open offer in similar terms). The other party is then unable to make the point that their conduct would not be viewed as unreasonable if the FDR indication could be taken into account, because of the without prejudice nature of the FDR. This has previously in my experience unfairly prejudiced one party to the litigation.
||In the event that the other party is delaying settlement and simply knowing that even in taking an unacceptable position has no impact upon costs. It precludes settlement in a number of instances.
||As a mediator, I believe every incentive possible should be given to encourage people to settle without going to Court.
||Under the new financial court pilot the judge who deals with the first directions appointment will apparently also deal with the final hearing so it makes a nonsense of any without prejudice discussions/offers that might otherwise have taken place at the first hearing. Without prejudice correspondence is often used inappropriately to make better, more reasonable offers, or additional correspondence used to chase up an open version of the WP offer thus adding to client’s bills.
||I have had at least three cases over the past 18 months that have proceeded to final hearings lasting more than one day where the other party has been unreasonable in their expectations even after FDRs when the court has expressed opinions on likely outcome. At the moment there is little incentive, other than running up their own costs, for a disgruntled party to settle. In my view, post-FDR, it should be possible to make Calderbank offers that will have cost consequences at trial. I believe this would encourage more reasoned and reasonable approaches to be taken having had the benefit of the court’s view at FDR.
||Open offers are rarely beaten, so the issue of costs often does not arise anyway. The purpose of WP offers was always to preserve the position on costs, without damaging a party’s open position at trial. Taking away the force of WP offers now seems to mean that a party can get away with totally unreasonable conduct, in the pretty sure knowledge that it will not mean a costs order against them.
||I believe that the risk of adverse costs orders offered a greater incentive to settle before final hearing. More of my cases have gone to final hearing since the introduction of the current costs regime.
||It would put pressure on the opposition to respond to offers. I had a case recently when we made an offer. Received no response despite chasing. We then threatened to stop voluntary maintenance (no children) if we didn’t get a response (not an agreement) within 14 days-again no response so maintenance was stopped. The other side still ignored the offer but issued an application for maintenance pending suit. There should have been costs implications. By the way at the First Appointment prior to the MPS hearing my client agreed to reinstate the maintenance and at the MPS hearing the same figure was ordered and no order as to costs made.
||I feel that parties do not necessarily behave as they should and if there was more realistic chance of costs orders being made it would focus the parties’ minds. I have had recent cases that conduct has been such that if costs order was possible it would have prevented it going to final hearing. Other side wanted say in court and behave appallingly and cost client thousands to get the same result as first ordered all because other side thought would get more and wouldn’t be penalised costs wise as wasn’t much in assets and was needs case so they had been advised that a court wouldn’t make costs order so behave badly as no court would make costs order in needs case as would penalise them and any children. I think if the Calderbank came back this would reduce cases going to final hearing and focus parties’ minds to settle.
||It will encourage litigious parties to be more sensible. It will also stop a party with more financial muscle from forcing the other party to settle on less advantageous terms. I am old enough to remember the Calderbank regime and the risk of paying the other party’s legal bill was a great disincentive if a client was being stubborn.
||It encourages litigants to give serious consideration to reasonable offers in circumstances where sometimes they are taking advantage of the fact that they are a litigant in person and the other party is paying for legal representation. It also encourages both parties to give careful consideration of any reasonable offers made.
||Save for the client’s own legal expenses and litigation risk, there is no real incentive on them to seriously consider making, or accepting, a sensible offer for settlement prior to a hearing. A costs risk would, therefore, encourage more settlement.
||Litigants in person need to be aware that they have to behave properly and it stops clients being wholly unreasonable.
||Not a good question since it seeks a black or white answer. If I have to give an answer to that black and white question it is yes.
The old Calderbank procedure encouraged settlement and worked well. It prevented waste of Court time by parties taking cases to Court since they knew there would be no costs penalty. Any family lawyer knows that divorce often involves acrimony and a wish to hurt the other party – sometimes in whatever way they can.
||I often have cases where I represent (say) a husband who is the breadwinner and the (say) wife is the homemaker. The wife often has an interim position where she will be in the FMH to exclusion of the husband yet he is the one paying for everything. She will refuse to meaningfully negotiate and will often do so at the door of court at the final hearing just to prolong the amount of time the interim arrangements are in place. A w/p offer with teeth would help reassure the husband that perhaps some costs would come back to him at the end of the case.
I also have a number of cases where, even at FDR, one side is putting forward a wholly unrealistic stance – there is nothing that can be done to put pressure on them to settle or to reassure your own client that this hasn’t all just been a waste of time if there is no ‘teeth’ to a without prejudice offer.
I understand the competing arguments and why ‘Calderbank’ offers as they were in the FPR 1991 rules are perhaps undesirable. This suggestion appears to be a helpful middle ground.
||The current position is deeply unfair, especially in the growing number of cases where either
(a) one party is acting in person and has no legal costs to pay; or
(b) one party is having their legal fees paid by the other party from that party’s resources either pursuant to a LSPO or voluntarily; or
(c) one party is running a “needs” case and is accruing debt on legal fees which they can be confident the judge at final hearing will order the other side to pay off so their needs entitlement is not infringed on.For parties in this position, there is little to no downside in litigating to a final hearing and no incentive at all to reach settlement. I have done many cases in recent years where at final hearing we have achieved an outcome much better for our client than WP offers made at FDR stage and beyond – the client’s reaction has almost invariably been dismay and regret that so much family money has been wasted on lawyers only for their ex partner to achieve a less good result than they were willing to offer months ago.In the absence of costs penalties, there is no sanction against clients who refuse to negotiate and, crucially, to negotiate reasonably. Solicitors advising them can warn them of the risks inherent in all litigation but have to concede, when the client asks what the actual risk is of their “day in court” that a costs order is a very remote possibility.I appreciate there are all the other reasons why a final hearing is undesirable – the stress, the delay, the impact on children etc but in my experience, for the clients in this category, the only real disincentive is financial and a costs order. Their concern is “will I get less money as a result?” If the answer is no, that tends to settle the issue.
In particular, there must be a willingness to make costs orders even in “needs” cases and even where the effect of the costs order is that needs potentially are not met. There are very many cases we deal with every year where the person running the needs argument essentially has a carte blanche to litigate as unreasonably as he or she wishes, secure in the knowledge that, absent very unusual circumstances, the judge at final hearing will order his or her legal fees debt to be discharged by the other side in order to ensure the needs settlement is not cut into to pay costs. I have done several cases where the money paid for legal fees in these cases has been considerably higher than the needs award itself. This cannot be right.
||There is little point in encouraging parties to make offers if in so doing they can be ignored with no come back on the other party. The whole point of reasonable offers is to avoid costly litigation therefore provided the offer is properly constructed and capable of settling the matter it should not be ignored and should be considered in relation to costs if unreasonably ignored.
||I consider that admissible WPSATC letters will have a number of advantages:
– They will encourage parties to make realistic offers to resolve matters.
– They will prevent one party refusing to negotiate or otherwise drawing out litigation.
||It encourages negotiations and encourages people to consider offers carefully even if they are not exactly what they want.
||To encourage proper negotiations to take place, and not to ignore the principle that at any stage, including after an FDR hearing, parties should try and reach an agreement and avoid a final hearing and often the spouse who has more disposable cash, will not want to enter into negotiations, either through spite or in an attempt to intimidate the other spouse, or even a spouse who has the benefit of legal aid, will abuse their position and will do all they can to ensure the other spouse who does not have legal aid, incurs unnecessary legal fees, the system can quite often be unfair.
||In some cases only one party tries to settle. The other party may deliberately avoid settling or settle at the last minute with the sole aim of causing maximum distress and costs to the party making every effort to settle. A refusal to consider FDR recommendations or to seek to narrow the issues results in avoidable costs being incurred. If the unreasonable party is in person and bitter about the divorce there is no incentive to settle because costs orders are very rare. The court should be able to consider all WP save as to costs offers to understand what genuine efforts have been made on both sides to avoid unnecessary costs. I would welcome a change in the rules to enable the courts to make costs orders in those cases where one party has been obstructive or unreasonable when responding or failing to respond to settlement offers.
||In my experience parties are more likely to be encouraged to settle early if there is a prospect of costs being ordered against them at a FH if they do not achieve an outcome more favourable than the offer made to them.
||Parties rarely make open offers until they are obliged to prior to a final hearing unless they have a cast iron case so even the amendment to FPR PD28A is unlikely to have significant effect in prompting negotiations.
In needs cases, often the party “in need” will force the case to a final hearing, doing the absolute minimum (notwithstanding the best efforts of the party with the money) in the full knowledge that a costs order won’t be made as it would affect their crafted needs based outcome. Having Calderbank offers which are actually taken seriously by a court and reflected in costs should make parties more willing to negotiate behind the scenes. Pure WP offers often have no effect in making one party see sense as even a FDR indication doesn’t have “teeth”.
||It focuses parties on constructive negotiation.
||I agree it may not be appropriate to have a strict rule akin to beating the Calderbank. I was always told costs orders lead to bitterness in family proceedings. However, dealing with unreasonable litigants without any apparent consequences leads to bitterness too. That feeling features throughout my professional practice and my personal experience where orders made at final hearing are in line with offers made early on. Personally, it has taken me years to make up the £10,000+ costs I spent going to trial with an unreasonable applicant. There is no recompense for the emotional impact of a year of unreasonable litigation. Where one party in family proceedings can have completely unreasonable expectations throughout, putting the other to the expense and emotional strain of going to a final hearing, only then to find it has no effect on the outcome in any way, undermines public confidence in the law and the legal system. We have a structure which allows considerable discretion. That discretion should also apply on costs in a more general way not simply in the absolutely worst cases.
||I could never understand why Calderbanks were abolished. They helped settle cases as clients were concerned about the costs of the other party too. Without this extra level, there is less reason to settle and be wary of court proceedings. They don’t necessarily have to be admissible as conduct, just brought back.
||Parties have little incentive to engage in reasonable negotiations without the threat of a costs order if they fail to do so.
Calderbank letters are a convenient and codified method to bring this unreasonable position into sharp focus before the court.
a) encourage settlement at an early opportunity
b) ensure that reasonable offers are made
c) ensure that offers are considered carefully
d) hopefully lead to more cases being concluded at an early stage
e) ensure advice is given which does not always appear to be the case.
||As it currently stands, parties have no incentive to settle cases and instead see no risk in proceeding to trial. Since the rules changed and we lost ‘Calderbank’ offers, I have seen a 100% increase in the number of cases going to a final hearing.
||It supports a client’s case when dealing with a party who feels they have nothing to lose e.g. they are the main carer and know that their housing needs will have priority.
||There is no incentive to settle prior to court hearings without the pressure of a Calderbank offer. The party with greater finance at their disposal can use the costs of court hearings as a cosh to prevent the weaker party proceeding.
||Our local Court is generally very uncomfortable with making any costs orders, no matter how unreasonable the Respondent has been (there are some exceptions), so the bar is very high at present. Bringing back Calderbank offers might just lower that bar, so that an Applicant (usually) gets some recognition for the extra costs associated with dealing with an uncooperative Respondent can be recouped.
||There is no incentive for parties to settle in FR proceedings anymore. Calderbanks are a good way to focus the mind.
There is no certainty re costs penalties despite conduct/litigation conduct meaning that one party’s behaviour is almost always not punished.
Practising without them is incredibly difficult.
||At present there is insufficient incentive to make parties negotiate reasonably and realistically.
||It would encourage parties to reach a resolution if it was clearer that an order for costs could actually be considered should they act unreasonably.
||If the WP Offer is wholly unrealistic or is deemed to be disingenuous then in my opinion that should amount to “Conduct” and have a cost consequence.
||Anything which encourages parties to negotiate is positive.
||I have worked in this area for 30 years and am of the era where Calderbank offers were regularly used and put before the court on the issue of costs. There seems to be an increasing lack of negotiation in proceedings. If the court were able to take such offers into account as they did historically it is my view that it would help concentrate minds and aid negotiation (although I do wonder from the point of view of increasing litigants in person whether they would pay any heed to it).
||I have been involved in cases where the costs run up against the value of the assets have been prohibitive, but there is almost a ‘devil may care’ attitude of one of the parties, as there is no sanction with respect to costs, or any way of evidencing this clearly it can be frustrating.
||Whilst the vast majority of cases manage the proceedings appropriately and conduct the litigation fairly there are those cases where this simply does not happen and there is really no sanction. The advice we have to give is that there is no alternative but to spend disproportionate amounts of money with no chance of recovering those costs when the client is taking a fair and reasonable approach but the other party is not. This is even more prevalent with the increase in litigants in person. In cases where one party does not feel on an equal footing without representation this leads to even more unfair outcomes.
||Reasonable attempts to settle matters can be thwarted by the other party refusing to negotiate or to move from an impossible position, resulting in unnecessary costs being incurred. Evidence of a refusal to negotiate or adopting an unreasonable position should be taken into account on the issue of conduct when deciding costs once a judgement has been given. This is often the case with litigants in person who adopt a position and, even when a contrary indication is given at FDR, refuse to move from that position.
||There is currently little, if any, incentive for parties to negotiate sensibly when costs consequences are very unlikely to follow. The argument that Calderbank offers undermine carefully crafted awards by judges is erroneous. Such an argument against the reinstatement of Calderbank offers wrongly equates them with Part 36 offers and assumes that costs penalties automatically flow. Even with the reinstatement of WPSATC offers, a judge will retain a discretion to ignore the offer entirely when considering costs or could choose to make an order than one side pay just 5 or 10% of the other side’s costs. That, in my view, remains an incentive to settle and a reason to bring back Calderbank offers.
||It is currently almost impossible to get costs orders in financial remedy proceedings for overall resolution of the parties’ finances on divorce. No party wants to make too many concessions on an open basis and a without prejudice offer has no teeth if all the costs are coming from a joint pot. Calderbank offers would reduce the number of cases coming to court and thus save the court costs and help to keep the parties’ legal costs down, both because cases would be more likely to settle and because no party could be as confident as they now are that all costs will be met from the joint pot.
||Such a change will facilitate constructive negotiating and penalise those who litigate for no good reason – often in circumstances where the size of asset base does not warrant such an approach.
There are far too many examples of such conduct in my FR practice to be specific.
||Unwillingness to negotiate appears to be becoming more of the norm which wasn’t the case when Calderbank rules were in place.
||Unfortunately far too many parties fail to settle or consider a good offer that is made as the consequences of failing to do so are not severe, save for a worse result at court.
If Calderbank offers were reintroduced, it would force parties and their legal representatives to make and consider good offers more seriously. Ultimately this should lead to less cases going to Final Hearing which frees up court time.
||My experience is that under the current regime, open offers are not used given the concern about conceding points from the main argument in case of a final hearing. The current rules mean that often extensive Without Prejudice negotiations are completely irrelevant for a final hearing, meaning that the consequences of rejecting them are more limited and a judge will not be aware at all of one party making numerous and reasonable attempts to reach a settlement. Rules allowing WPSATC offers would support settlement on this basis in my view, so long as they are one factor taken into account in the conduct of a party and not an absolute requirement for a judge to make a costs order.
||At the moment there is no real impetus in terms of a threat of a costs order to settle at an early stage – we make offers ‘without prejudice’ but the court is not interested unless was an open offer. It doesn’t carry the same threat that I have seen is real in civil cases.
Legal costs are just seen as a debt that has to be taken into account – in a recent case wife’s debt was £170K whilst husband whom I acted for and did most of the work was £40K. Wife’s legal team knew it would just be paid from the assets and there was no real motivation to settle for wife.
||I have recently had a case where there was very little to divide between the parties save for equity of £85,000 in the family home. The husband was a company director with his three brothers drawing income of around £5000 per month. The wife was a part time cleaner. The husband ran the case to a final hearing on the basis that the house was to be divided 50/50 and no PP for the wife although his company shares had a similar value to the family home. The husband changed his position on the day of the final hearing to say that the wife should retain the family home but not before the wife had spent £35,000 in costs which the wife had to borrow from family.
||Half of my case load is dispute resolution. Costs are an important factor for those clients and I think family clients would be a little less blasé about reasonable offers if they also had to take a potential costs order into account. I do think that it will encourage clients to reach an agreement.
||I always felt it was wrong to take away the persuasive effect of ‘Calderbank’ offers. Where one party unreasonably refuses to negotiate then there should properly be a costs penalty. This is particularly so where the Applicant is a litigant in person – throwing the costs of preparing bundles etc onto the represented respondent. If that respondent takes steps to negotiate which are ignored by the LIP then the LIP should be made aware that he/she may end up paying costs in an event from their settlement. Too many cases are ending up in Final hearings because litigants have ‘nothing to lose’ under the ‘no costs’ regime.
||I have been involved in dozens of cases since the rules changed excluding WPSATC offers where I think Calderbank would have forced an unreasonable litigant to settle. The classic example is a fairly clear 50/50 case where needs are a potentially but not a likely driver towards inequality. An unreasonable wife (usually as the receiving party) can hold out for a substantial departure from equality and a husband who has a good shot at equality at trial cannot make a Calderbank at say a modest departure from equality and rely on it for costs after a trial where he will argue for 50-50. This leads inevitably to a trial where (regularly in my experience) W gets a worse outcome than the Calderbank offer that would have been made had it been worthwhile. I appreciate that costs orders post Calderbank can disturb a carefully crafted order but that does not mean that they Calderbanks should not be a factor (not necessarily determinative) in the costs mix. There are myriad other examples but the above is just one- others off the top of my head where it would help are variations, big money needs cases etc. Open offers do not help. Inevitably they are a starting point and it is much harder to advise a client to make them. I have been doing money work for 23 years in central London and the removal of Calderbank has been the worst policy decision of my years in practice. Please bring it back!
||As a means of facilitating early settlement and to avoid inappropriate and vexatious litigation conduct by a party.
||Numerous times you have one party who makes settlement impossible and deliberately ignores timetables or provides inadequate disclosure, raising costs significantly for the other party. Currently there is little or no consequence and to achieve fairness it is right that the other party should be entitled to draw this to the Court’s attention on the issue of costs.
Secondly, it is more likely to focus party’s minds towards settlement if there is a potential for a costs order to be made against them, thereby reducing the strain on the Court system.
||I consider that this will encourage the parties to think very carefully before proceeding to a contested final hearing and help them agree matters at an earlier stage.
||When clients are being patently unreasonable on either side the sanction of litigation conduct is no real “stick to beat them with ” as the sanction still depends on the discretion of a judge and in reality is not a threat clients understand ,without Calderbank there is no real mechanism to stop costs being run up unreasonably.
||The teeth of the without prejudice offers is lost, if it cannot be enforced at a final hearing. Couples are more likely to agree if there is a risk that they might have to pay costs then they are more likely to consider seriously advice when negotiating.
||It will persuade clients to be less litigious and not proceed to a final hearing to take a ‘punt’. It will force clients to be more reasonable in their approach to litigation.
||If the client has had to spend time and funds to sort out the unreasonable conduct or disposal of funds or hiding of funds, then for justice to be seen to be done, the wayward party should be financially made responsible for the cost of their behaviour.
This will give more armoury to the advice that one can give to a client to persuade them to comply with court directions.
||WPSATC proposals and counter-proposals with costs consequences encourage earlier settlement. The increase in LiPs mean that more cases are proceeding to final hearing without the other party engaging in meaningful negotiations. If WPSATC were admissible on the question of costs it would encourage sensible negotiations with the gap between the parties narrowed earlier. Settlement would take place sooner and in more cases. At present, there is no costs consequence of failing to engage in settlement negotiations until significant costs have been incurred.
||It would give leverage when negotiating and before final hearing, and should bring about more settlements and less litigation. Surely this would be a good thing given how over-burdened the Courts are.
It would also give the Court “teeth” in terms of its ability to impose adverse costs consequences if one party has litigated irresponsibly and/or very unreasonably.
Bring back Calderbanks!! I don’t know why they were taken off the menu in the first place.
||I agree that it is unusual to make any open proposal for settlement that is not your client’s best case scenario, which means that currently, it is extremely rare for costs orders to be made, as the judgement often falls between the 2 parties positions.
This in turn means that there are no repercussions for those who have refused to negotiate or who have rejected reasonable WP offers. If there were potential cost sanctions relating to WP offers, it would make parties far more motivated to try and settle before trial.
I recently had an FDR where the Wife ignored all proposals for settlement until 3 working days before the FDR and faced no criticism for her lack of cooperation, despite the parties’ costs being £60k by that stage!
||I am an experienced family law solicitor. I am a Resolution accredited specialist. I have dealt with financial remedy cases since 2004 (and have been in practice since then on a full-time basis).
Having been involved in many financial remedy proceedings in many courts I am concerned that the current rules have unintentionally undermined the willingness of some parties to negotiate or compromise.
Having practised under the previous ‘Calderbank’ regime I am convinced that there is a class of matters that under the current regime are more likely to proceed to final hearing, typically because 1 party has unrealistic expectations or is simply not prepared to listen to the advice of their representatives or the indication of the FDR Judge.
Whilst I accept that a % of those individuals would litigate come what may I am of the opinion that a not inconsiderable proportion of them would reflect on the ‘jeopardy’ of a costs order being made against them.
From my perspective (and surely the courts’) it must be right that we do everything we can to reduce the number of matters going to final hearing, particularly when many of them are not complex but simply represent an emotional reaction to the situation in which the parties find themselves.
It is difficult to give examples, but in a very recent case (an FDR last month) the husband has failed to hear the Judge’s indication and now the matter must go to trial. That matter is not complex in law and I am confident that if the Husband were aware of the costs risk he almost certainly would have made a far greater effort to negotiate at the FDR hearing.
I do not suggest a return to the ‘cliff-edge’ of the Calderbank scheme but instead more discretion being given to the trial judge to consider all the negotiations prior to final hearing (including what transpired at the FDR) and a reduction of the emphasis on the current ‘no order as to costs’ regime.
||On balance, I think the answer is yes, Calderbanks ought to be revived to assist in (probably the minority) where the other party is entrenched and pursuing their position irrespective of legal advice and the likely outcome. However, in practice Calderbanks probably would only apply to a minority of cases because most parties are concerned about the level of their own costs increasing and thus take a pragmatic approach.
Consideration, also, needs to be given to the fact that the family justice system now encourages parties to a more dispute resolution process rather than the traditional adversarial system and enshrining Calderbanks in the FPR does not necessarily complement that approach.
||I have had numerous cases where costs have been run up disproportionately by either or both parties and this would serve as a useful sanction against it.
||Too often costs are run up unnecessarily because one party fails to enter into meaningful negotiations.
||This principle should not have been altered in the first place.
||In an era where parties are encouraged to attend mediation and resolve matters amicably, it is important that the Court is able to hold parties to account when they have refused to resolve matters amicably and have issued proceedings without any attempt to resolve matters amicably. For instance, I have had a cases where H has made reasonable proposals to resolve matters and to attend mediation to negotiate further if necessary, yet W has issued Court proceedings to ‘put a timetable in place’ and as a result escalated costs, increased animosity, and made incorrect assumptions about H’s finances which could be avoided by negotiating. The Court should be empowered to hold people to account where they have acted litigiously, when they were able to do otherwise.
||As the working paper states, it is too easy for parties to not present an open offer which is a true reflection of the WP offers made which can then make it difficult for matters to be progressed. WP correspondence is useful for the court to see in any event – that is why it is permitted at the FDR.
I agree in principle but:
On the basis that only when full disclosure, valuations etc have been provided should they have potential impact at all, and;
Each case is still considered on it’s individual merits (as it always was any way “back in the day”. It is too simplistic to apply a blanket cliff edge rule).
It will concentrate the minds of the parties on settlement. At present it, is in my opinion, too often now a case of a party thinking “What, have I got to lose” , especially as the costs incurred by a party to the final hearing are generally considered to be a liability reducing the available capital for division. So on needs base cases there is often no incentive to the party in need to settle.
||It makes people think more seriously about offers and means they do not keep litigating when sensible suggestions have been made.
||Parties are reluctant to make open offers, particularly early on, but wp save as to costs offers which have possible costs consequences would be more likely and would then require proper consideration, whereas wp offers can be ignored without real consequences.
In practice I suspect costs orders would be rare – they were historically – but the possibility of them would make people take these offers more seriously.
||To try to assist as a deterrent for litigants who fail to deal with sensible offers, particularly at an early stage, and therefore save unnecessary costs being incurred.
||This isn’t a straightforward “yes”. Most cases that go to final hearing are highly contested. I have recently had a case where the opponents conduct towards litigation was wholly unreasonable and sadly my client suffered the costs of this through unnecessary litigation. However, discretion would be required given the broad nature of the MCA and the fact that there isn’t necessarily a right or wrong answer based on different interpretations. It is unusual to have a case where one party is wholly correct. I suspect such offers would only really be relevant in cases where there has been terrible litigation misconduct causing the final hearing and the court may be better just taking a broader view of conduct.
||There has been a steady increase in some clients/solicitors declining to enter into any negotiations preferring to “leave it to the judge”.
Recently I have been involved in a case which is driven in a contentious and litigation manner with no thought being given to “finding a solution”.
||As we are having to deal with more litigants in person, the issue of LIPS failing to negotiate or conduct matters reasonably is becoming more prevalent thus resulting in clients’ costs increasing unnecessarily. This is essentially due to a lack of understanding in most cases but it is nevertheless a problem.
||All too often a party who assumes an unreasonable position does so without consequence, whilst the party with the reasonable approach endures substantial consequences in terms of additional costs, delay and stress.
||I have had a few cases recently where the person on the other side refused to make sensible offers and was difficult during proceedings. There was little money in the pot and that person’s conduct by not complying with directions and refusing to make sensible proposals resulted in my client having disproportionate costs.
||The current regime does not work. There is no incentive to settle. It creates huge inequalities on both sides. Rich husbands that can fund a war of attrition against their wives without fear of cost penalties and spouses can run hopeless cases at huge cost to BOTH in the faint hope of success. It encourages poor family lawyers and poor practice because these solicitors know they will never have to explain to a client that they’ve got a costs order against them because they were poorly (or not) advised.