This week an article by Dan Hyde in This is Money, outlined the “cash crisis in break-ups as banks tighten purse strings on ‘divorce loans’”.
This article detailed the reduced number of clients being funded by litigation loans following the economic downturn in 2008 and the concern by those going through divorce as to how to provide for legal costs.
Since the credit crunch some of our clients have experienced a refusal of litigation loans. It is a common state of affairs that when going through matrimonial disputes the financially weaker party can often face a real challenge over how to fund ongoing litigation.
With interest rates rising and some banks claiming almost immediate repayment it is little surprise that clients can face anxiety over the management of fees.
Providing clients with up to date fee assessments on a regular basis will allow for a better relationship at such a difficult time between both client and lawyer.
However, without personal capital and access to loans, clients turn to family handouts to finance rising costs. Sadly such support is not always an option. “Britain’s top divorce lawyer” Ayesha Vardag is well known for representing high profile and high net worth individuals. On the other side of the fence, Miss Vardag will also fight tooth and nail for the financially weaker party.
In these modern times it may be surprising to note that some homemakers have been financially managed by their spouses. Often they are not aware of the level of assets or even their location and home sweet home may even be a property controlled by an unknown company.
In such cases where top class legal representation is key, Vardags offer a unique approach.
Dr Stephen Bence works as our Financial and Corporate Consultant ensuring that the full worth of the financially stronger party is taken into account. Dr Bence assists Vardags by assessing the key assets in a case, unravelling complex remuneration structures, valuing hard-to-value assets such as private companies and uncovering behaviour designed to obscure value.
In addition to analysing the true financial position of the case Vardags through the vehicle of A v A 1FLR 377 can apply on behalf of the Applicant for legal fees provision under an interim maintenance application. Effectively this means that together with interim maintenance for the Applicant’s personal needs, the Respondent can be ordered by the court to pay for the Applicant’s legal costs. To facilitate such a step the Applicant will need to demonstrate that no assets and/ or income are available to meet their legal costs; that a litigation loan has been refused; a deed of assignment has not been offered by instructing solicitors; and that public funding is not available.
Vardags has had storming success in obtaining A v A orders from the court enabling the Applicant to properly fight their case and level the playing field. While litigation loans may seem like the only avenue for cash strapped Applicants, Vardags is always pushing to find creative solutions.