Family Law Court grants wife interim costs to help cover her $10.5 million in divorce legal fees

When separating it is often the husband who moves out and the wife stays in the matrimonial home. In many cases the husband has the higher income plus access to financial resources including the ability to borrow money. Often the wife has limited access to cash and has the added time burden of caring for children. This financial disparity and inequality becomes more significant when legal fees for a divorce are considered. There can often be a significant length of time between separating and a final division of assets. In this case it was over four years.

A recent full Family Court decision in September 2009 granted a wife interim costs for her divorce fees. This “interim” or stopgap decision gave the wife access to joint property before the final decision on the separation of their assets. The case was Strahan & Strahan (Interim property orders) [2009] FamCAFC 166 (14 September 2009). The Family Court restated the test by which a party could apply for an “interim” property order. The order was to provide funds to meet her ongoing legal costs of the proceedings in circumstances where she did not have funds required to pay these costs.

The Court confirmed that the most important consideration is the interests of justice in determining whether it is appropriate to exercise the power.  The Court has a wide and unfettered discretion to make an order of this nature.

Comment from Mark Streeter - Sydney Family Law Lawyer

This divorce case involved an enormous matrimonial pool.  There was a dispute as to exactly how large the asset pool was but the range of estimates was $80 million to “hundreds of millions”. The wife had spent approximately $10.5 million in legal costs since the commencement of litigation in February 2005.

On any examination of the divorce case there were enormous commercial and factual complexities.  There were substantial accounting and forensic investigations to be conducted. There were allegations of non-disclosure and deficiency in discovery and production of documents by the parties.  The trial judge was satisfied that the wife needed funds to meet ongoing legal costs of the proceedings and that she did not have funds to pay those costs.  

Additional findings were important that:
•         The husband was able to pay his legal costs and expenses.
•         The husband was in the position of considerable financial strength.
•         If the interim order sought by the wife was made there was no issue that the remaining property would be more than sufficient to meet the claims of the parties when a final order was made.