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General

Capacity to pay

The Court of Appeal decision in Biggs v Biggs highlights the cost of litigation, whether on the side of the angels or otherwise. In this case the wife has incurred costs to date in excess of $1 million, which her evidence is, that she cannot pay. The husband’s costs are half that of the wife. The wife seeks an interim distribution so that her advisers can be paid.

The question for determination as set out by the Court of Appeal is that:

The view of the court was that Mrs Biggs should be awarded an interim distribution of $700,000 that allowed her to pay her advisers as she determined, the amount of the distribution being less than the outstanding fees.

[30] Put in this way, the question on which the appeal turns is whether the burden of funding the wife’s costs of the litigation should be borne by the husband or by the wife’s advisors. We repeat that it falls to be answered in circumstances where, on the record before us, the husband has not provided evidence of any inability to pay and the payment can be reimbursed from what is indisputably relationship property.

The distribution was on account of a Mrs Biggs’ as yet uncrystalised share of relationship property. The take home message is – look to the likely end game, when challenging the steps.

Also see David and Goliath.

References:

  • Biggs v Biggs [2020] NZCA 231
  • Biggs v Biggs [2020] NZHC 768
  • Biggs v Biggs [2018] NZCA 546
  • Biggs v Biggs [2018] NZHC 1592

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