… and the options available to those at a disadvantage

It is not uncommon for family law matters to be characterised by a power imbalance, where one party has access to significantly more financial resources than the other. This inevitably leads to the financially weaker party feeling as though they are at a disadvantage and often impacts on the progress of the case.

Financial power imbalances influence the trajectory of the case from the beginning and can continue to have a heavy role throughout. The power imbalance can affect access to legal representation, the pace of proceedings, the dynamics of negotiations and unfortunately, sometimes it affects the fairness of the results.

Power imbalances can take many forms. Most commonly, we see one party whose role in the relationship was to earn a wage and support the family, whilst the other party’s role was to care for the family – on separation, the financially stronger party continues to be able to rely on their income to pay their legal costs, whilst the other party may struggle to obtain any initial legal advice, let alone ongoing representation.

Power imbalances can also arise in a number of other ways, such as:

• Having access to significant savings and/or an inheritance to support income;
• Receiving financial support from parents and/or other family members; or
• Having access to Legal Aid funding, where the other party cannot afford representation.

How does financial inequality influence matters?

1. Access to legal representation: Legal advice is expensive, especially when cases can take a number of years to reach a conclusion. The financially stronger party is often able to instruct experienced solicitors and can manage their case without worrying about how they will pay their invoices. Comparatively, the party at a disadvantage constantly has to worry about mounting costs – this could mean they are unable to obtain any legal advice at any point during the proceedings and have to self-represent, or it could mean that they can only take ad hoc advice or that they need to stop instructing their solicitor part-way through.

• Procedural inequality: Parties unburdened with financial concerns are able to conduct their matter fully, meaning that they can promptly instruct necessary experts; make interim applications if required; and weaponise tactical delays. Parties struggling financially do not have the same ability and lengthy matters can be unsustainable, sometimes resulting in them accepting an unfair deal simply to bring the matter to a conclusion.

• Negotiation pressure: Financial power imbalances have a big impact on negotiations. The financially weaker party often does not have access to full legal advice, meaning they cannot participate equally in negotiations and do not know how to assess the fairness of offers. The stronger party is able to take advantage by making unfair offers and applying pressure by exploiting their financial stress, fear of costs and desire for the process to be over as quickly as possible.

Parties at a disadvantage know they are at a disadvantage from the beginning and it does impact on how people proceed and decisions they make for themselves but is there anything that can be done about financial power imbalances?

The good news is that there are a number of options that might help tip the balance:

1. Ensure your income is maximised and your outgoings are reduced as much as possible – this is called mitigating your finances. You could explore your eligibility for state benefits, child maintenance or increase your working hours. You should also look to reduce expenditure on ‘luxuries’ if you have not already done so.

• If your outgoings exceed your income, you may have a claim for spousal maintenance (or maintenance pending suit, as it is called before a financial order is made). This involves looking at how much money you are short each month and whether it is reasonable and affordable for your opponent to make payment of that sum to you. Maintenance from your spouse has to be based on your evidencable and reasonable need, a maintenance claim cannot arise just because one party earns more and the other party feels this is unfair.

• If there are joint liquid assets, you could explore reaching an agreement that you can use them to assist with your legal costs.

• If there relationship was domestically abusive and you satisfy the means criteria (financial aspect), you may be eligible for help with your fees from the Legal Aid Agency. Not every firm offers Legal Aid services but you can find a list of firms that might be able to help on the Legal Aid Agency’s website. The Agency’s criteria for funding is strict and you will need to be assessed as eligible before proceeding. It is important to understand that Legal Aid is not free and it should be viewed as a loan because if you gain or retain a financial interest through the course of your matter, you will need to repay the costs to the Agency when your matter concludes.

• You could research Pro Bono legal services in your area. Some universities offer ‘clinics’, whereby you can access some legal advice from students under the supervision of qualified lawyers. Lots of solicitors’ firms offer some free initial advice, too, so it is worth trying to speak to someone about your case.

• Litigation loans are another available option. These often involve high interest rates and they will require some certainty as to your prospects of success but a litigation loan enables you to fund your matter and repay the lender at the end of the proceedings.

• If you have exhausted all of your options and your opponent has access to significantly more resources than you, you may be able to apply for a Legal Services Payment Order. This type of Order has a strict application process and criteria, but if successful, would require your opponent to pay for your legal representation – this can either be in lump sums or regular payments. There can be cost consequences if your application is unsuccessful, so obtaining legal advice on these Orders is important.

• Alternative dispute resolution (ADR), such as mediation, is also an option. This can reduce costs, time and the temperature of matters. In some cases, such as domestic abuse cases, ADR may not be appropriate. However, the financially stronger party may still continue to take legal advice as to their position during the mediation process. Collaborative law is also another option, but does require both parties to instruct a lawyer that is trained as a collaborative lawyer.

Whilst going up against someone who is financially stronger, it is important to remember the following:

• Take some initial legal advice at an early stage so you are at least aware of your basic legal position from the beginning;
• Do as much of your own research as possible – blogs and articles written by lawyers are often a good source of basic information as to the law and the processes. Avoid taking advice from blogs online written by people who are not legally trained, as this may not be correct information.
• Try to avoid direct conversations with your opponent about the financial matter. They do not have your best interests at heart and even if they appear genuine and concerned for you, it is possible they are trying to take advantage of your vulnerability to achieve a better outcome for themselves.
• Explore all funding options and do not give up at an early stage because it seems hopeless.
• The Court will not treat you differently if you have to self-represent. The Court expects all parties, legally represented or not, to follow the rules and its directions. Not having a representative and not knowing the law, or the procedures, is not accepted as a defence to not participating in the proceedings fully. This is why some early, initial legal advice is beneficial to everyone facing a set of Court proceedings.

Financial power imbalances are common and they shape who can assert their rights and who can endure the process through to the end. It is important to keep in mind that a financially weaker party is as entitled to a fair outcome as anyone else, even if that person does not have access to the resources to stick it out until the end.

Whilst there are tools to try and bridge the gaps, accessing the tools requires early action, awareness and support. It also requires the financially weaker party to believe in the outcome, even though that outcome may seem impossible to achieve at the start and it will feel easier to give in and accept an unfair deal to bring matters to an end swiftly.

If you are at risk of being at a financial disadvantage, some early initial legal advice could change how you navigate your proceedings and help you achieve a fairer outcome overall.

You can also complete an online enquiry form. One of the Wollens team will contact you as soon as they are available.