Case No: B4/2013/1075
Neutral Citation Number: [2014] EWCA Civ 1437
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM BOURNEMOUTH COUNTY COURT
HIS HONOUR JUDGE MESTON QC
WY08P00491
Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 05/11/2014
Before :

LADY JUSTICE BLACK
LORD JUSTICE KITCHIN
and
LADY JUSTICE GLOSTER
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RE L (COSTS OF CHILDREN PROCEEDINGS)
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Mr Adam Langrish (instructed by Redferns Solicitors) for the appellant mother
Mr Steven Howard (instructed by NGA Solicitors) for the respondent father

Hearing dates: Friday 3rd October 2014.
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Judgment
Lady Justice Gloster : 
Introduction
1.	This is an application by the appellant mother (whom I shall refer to as “the mother”), for permission to appeal, an extension of time and, if permission is granted, the appeal against paragraphs 5, 6 and 9 of an order made by HHJ Meston QC on 25 March 2013 in the Bournemouth and Poole County Court (“the Order”), on the application of the respondent father (whom I shall refer to as “the father”). 
2.	The hearing before HHJ Meston QC took place in the absence of the mother for reasons which I shall elaborate below. 
3.	The material parts of the Order (as anonymised by me) were as follows:
“UPON hearing counsel for the applicant father …and counsel for the children’s guardian.
AND UPON the respondent mother …. neither attending nor being represented, and the court being informed that the mother had been notified of this hearing and of the application for an order for costs.
AND UPON it being recorded that the children’s current wishes and feelings regarding contact with their mother are as set out in paragraph 2 of the report of the guardian …. dated 20.03.2013, being that:
a) Contact with their mother should re-establish on a gradual basis and be guided by the children.
b) At least initially contact should be supported and might, for example, start with a short contact at the maternal grandmother’s home or supported by the maternal aunt Sarah.
c) The children’s expressed hope is that contact would gradually increase up to a maximum of:
i) staying contact during school term time, on alternate weekends from Friday after school until 7pm on Sunday;
ii) staying contact during Easter school holidays and Christmas school holidays, for one week; and
iii) staying contact during the Summer school holiday, for between two and three weeks.
AND UPON the guardian supporting the father being responsible for administering the children’s trust funds, and further supporting the father being responsible for decisions relating to the children’s future schooling.
1. The child TL (d.o.b. 10.04.2000) shall reside with the applicant father.
2. The child BL (d.o.b. 23.06.2003) shall reside with the applicant father.
3. The Order of District Judge Willis dated 15.05.2012 be discharged and replaced by the provisions of this order.
4. The applicant father shall be solely responsible for making decisions in respect of the schooling of each child.
5. The applicant father shall be responsible for administering the Child Trust Funds in respect of both children with account numbers [X] and [Y] and for that purpose the respondent mother is directed to sign and return by 4pm on 08.04.2013 the necessary documents as are required to transfer the ‘registered contact’ for each account to the father, and if she fails or refuses to do so a District Judge may execute those documents
6. The applicant father shall be responsible for administering the T… investment fund invested through A.. Unit Trust Managers Limited with account number Z and for that purpose the respondent mother is directed to sign and return by 4pm on 08.04.2013 the necessary documents as are required to vest that account in the father for the benefit of TL, and if she fails or refuses to do so a District Judge may execute those documents.
7. Permission is given to the applicant father to withdraw his application dated 03.12.2012 for an enforcement order.
8. Pursuant to section 91(14) Children Act 1989 both the applicant father and the respondent mother are prohibited from applying for any order under section 8 of that Act in respect of BL (d.o.b. 23.06.2003) or TL (d.o.b. 10.04.2000) without leave of the court. Any application for leave shall be referred to Judge Meston if available. This order shall remain in force until the 16th birthday of the child concerned.
9. The respondent mother shall pay the costs of the applicant father in respect of the applications relating to the children since the order of 15th May 2012 including costs previously reserved (but excluding the father’s application for an enforcement order) in a sum to be agreed within 14 days of service of a revised costs schedule on the mother, or in default of agreement to be subject to detailed assessment on the standard basis by a costs judge at Bournemouth.
…”
4.	Pursuant to an order of this court dated 22 October 2013, Ryder and Macur LJJ ordered that the mother’s applications be adjourned until further order, that there should be a stay of paragraphs 5, 6 and 9 of the Order and that both parties were to notify the court by 19 December 2013 as to whether there had been an effective mediation. Unfortunately the mediation achieved nothing and, in the event, the applications came before this court on 3 October 2014.
Procedural history
5.	The history of this matter can be summarised as follows. The mother and father married on 9 August 1997. The eldest child, a daughter, TL, was born on 10 April 2000 and the second child, a son, BL, was born on 23 June 2003. The marriage ran into difficulties in 2007 and in December 2007 the mother and children moved to rented accommodation in Weymouth. On 14 August 2008 there was an incident at the mother’s home as a result of which the mother applied on 18 September 2008 for a non-molestation injunction. The mother was subsequently diagnosed with post-traumatic stress disorder as a result of this incident for which, in unrelated civil proceedings brought by the mother against the father, the father accepted liability. 
6.	After the breakdown of the marriage, there were sadly years of litigation between the parties involving, amongst other things, Children Act applications and contested property litigation. Until February 2013, TL lived with the mother and had made it clear that she did not want any contact with her father. There was thus no contact between TL and the father from 2009 until 2013. Litigation between the mother and the father focused on the son, BL. A previous residence application relating to BL was concluded at a final hearing before DJ Willis on 15 May 2012. By an order of that date he ordered that BL was to reside with the father and to have contact with the mother. Whilst this proposal was supported by the then allocated CAFCASS officer, a Mr B, the decision was apparently contrary to the repeated and recorded wishes of BL, who stated he wanted to live with his mother and sister. In the light of the history of the case, DJ Willis prohibited both parties (pursuant to s91(14) of the Children Act 1989) from applying for an order under s8 in respect of BL without the leave of the court for a period of 5 years.
7.	The contact arrangements as ordered by DJ Willis broke down on a number of occasions when either BL refused to return to the father’s care after contact with the mother and TL, or he refused to go to school on occasions when he was due to be collected from school by the father. This prompted the father to seek to make applications on 19 November 2012 to vary the contact order made by DJ Willis and prompted the mother to seek to apply for a residence order in relation to BL. At a hearing on 27 November 2012, DJ Willis gave leave for both parties to make applications in relation to BL and transferred the case to the Bournemouth County Court. 
8.	After proceedings had been transferred, a new guardian, a Mr R, was appointed to the case and a final hearing with a time estimate of 2 days was listed to start on 25 March 2013. During early 2013 there was a significant change of circumstances in that TL, having had various arguments with her mother, recommenced contact with the father, and within a week of doing so, expressed a wish to live with the father. At a directions hearing on 11 February 2013 it was agreed that TL would have contact with her father and that this would take place with no order of the court.
9.	Recognising the significance of the changing developments, on 26 February 2013 Redferns, the solicitors acting on behalf of the mother, wrote to Mustoe Shorter, the guardian’s solicitors, with a copy to the father’s solicitors, NGA. That letter (as anonymised by me) stated as follows:
“Thank you for providing us with a copy of your letter to NGA solicitors dated 25th February 2013. We can confirm that TL returned to her mother on 24th February 2013. We are instructed that the situation between TL and her mother was very emotional immediately following her return home, but after a great deal of discussion, TL calmed down and became more settled. TL had convinced herself that her mother did not want her to return home, but this was never the case, but TL was angry because she thought she had been abandoned.
We are instructed that contact has been agreed between TL and her father on the basis that she stays with him for 3 nights on one week and 4 nights the following week, whereupon this will alternate. TL has expressed her satisfaction with this arrangement, but it is subject to reasonable condition that the father is actually present when the overnight contact takes place. Clearly, there is no benefit to TL if she is either staying at her father’s home or somewhere else when the father is away on business.
We understand that BL is due to spend this weekend with our client and she is therefore expecting him on Friday 1st March.
This case remains listed for a final hearing commencing 25th March 2013, but in light of the recent, fairly dramatic developments, Counsel for our client has recommended that we secure an early directions appointment (ideally in front of HHJ Meston QC) to consider how those developments impact upon the applications before the court and whether there should be any amendment to the directions made on 11th February 2013 which did not anticipate subsequent events.”

10.	This request was refused by NGA, the father’s solicitors, who proposed that the parties should wait for the outcome of the guardian’s final report. 
11.	At the hearing for directions on 11 February 2013, when the mother, the father and the guardian were all represented by counsel, the order recited 
“And Upon the court being informed that the issues that remain to be determined are the future residence and contact arrangements for BL and the parties do not consider than any form of mediation is presently possible”

12.	The court then gave various directions for the service of evidence for the final hearing to be listed before HHJ Meston QC on 25 March 2013 with an estimate of 2 days and made an order that the costs should be in the applications “save to the extent the costs have already been reserved to the final hearing”.
13.	The guardian’s final report dated 6 March 2013 was received by the mother on about 8 March 2013. It was not supportive of the mother’s application for a residence order in relation to BL and proposed that both children should primarily live with the father, not withstanding BL’s then expressed wish to live with his mother. 
14.	On 6 March 2013 the father issued an application to have a residence order in respect of TL on the grounds that TL had expressed a wish to live mainly with her father. 
15.	In the light of the guardian’s report dated 6 March 2013, on 13 March 2013 Redferns, the mother’s solicitors, wrote a letter to the guardian’s solicitors with a copy to the father’s solicitors in the following terms. Given its importance to the issues in contention in this appeal, I set it out in full:
“We write with reference to the above matter which is listed for a final hearing due to commence of 25th March 2013. We are in receipt of the Guardian's report dated 6th March 2013 and we have discussed this with our client who has provided us with her instructions as set out below:-
It is with great sadness that our client acknowledges a breakdown in her relationship with TL who is now living with her father and BL. Although the application before the court is for a Residence Order in respect of BL, it is now clear that it would not be in his best interests for that application to be pursued. When issued, TL was living with her Mother and it was our client's intention that the children be together in her care. TL's unexpected decision to live with her father has brought about a significant change and in all the circumstances, our client does not feel that it is appropriate for her to continue the prosecution of her case. Accordingly, we are specifically instructed to seek agreement that a Consent Order be drawn up in the following terms:-
a) Leave be granted to our client for the withdrawal of her application for Residence and Contact Orders in respect of BL.
b) A residence order be made in favour of the father relating to TL.
c) The current Order for contact in relation to BL be discharged. Our client does not seek a defined contact order in respect of the children. In due course, she would simply hope that contact arrangements may develop naturally at a pace that each of the children are comfortable with.
d) The final Hearing listed 25th March 2013 be vacated.
e) No Order as to Costs.
Our client appreciates the Guardian’s recommendation that there be a shared residence Order in respect of the children, but she is mindful of the fact that such an order was previously attempted in relation to BL, but ultimately broke down and resulted in significant further litigation between the parties. By proposing a settlement of matters in the above terms, it is our client's hope that the litigation with her former husband may conclude immediately and any further applications in relation to the children will be unnecessary if her contact with them is based only on the arrangement that they expressly require.
Since dictating the above, we have received the father's application for a Residence Order in respect of TL. As indicated above, our client will consent to that order being made.
We understand that a directions appointment is listed for Friday 15th March 2013. In light of the mother's agreements as outlined in this letter, she has instructed us that she does not require representation at the hearing. Indeed, if a Consent Order can be drafted immediately for signature, then the hearing itself may be unnecessary. We would respectfully invite the father's solicitors to deal with this.
Accordingly, we look forward to hearing from you by return.”
16.	Despite what was an eminently realistic and sensible proposal from the mother’s solicitors for resolving matters on an amicable basis, neither the father nor the guardian’s solicitors agreed to it. In a position statement dated 14 March 2013, the father stated: 
“both children are now de facto, currently resident with the Applicant father. The Applicant father has made an application in respect of residence for TL. It is also understood by the Applicant father that the Respondent mother now wishes to withdraw her application for residence of BL but does not seek any defined contact arrangements for both children in the future. This position is unacceptable to the Applicant father who wishes for the question of contact at least to be resolved by a final hearing, as far as both children are concerned, fixed for 25 March 2013.”
No mention was made in that letter of any intention on the part of the father to seek his costs against the mother.
17.	In a letter dated 14 March 2013, from NGA, the father’s solicitors, to Redferns, the mother’s solicitors, NGA wrote: 
“Having taken instructions from our client and having further considered the matter with the Guardian, we feel that we cannot agree that there will be a Consent Order drawn up in the terms proposed or at all. 
Our client feels that the question of future contact must be ironed out properly so that there is no necessity for either party to make any further applications in the near future. Further the Guardian feels that in withdrawing your client's application for residence of BL, this must be properly explained by her personally to the Judge and he is also concerned that arrangements must be put in place for future contact to both the children by your client. It is for this reason that we are not prepared to enter into a Consent Order prior to the hearing tomorrow which we feel is completely inappropriate in the circumstances. We therefore intend to attend the hearing in respect of the directions appointment of our client's application for residence of TL and hope that the matter can be dealt with more fully at the designated final hearing on the 25th March. No doubt you will advise your client accordingly.”
18.	On 15 March 2013 there was a directions hearing in front of HHJ Meston QC at which the mother neither attended nor was represented. The relevant correspondence which I have referred to was read by the court and the court was informed that TL was now living with the father. The order provided that TL should be made a party to the proceedings, that Mr R should be appointed as her guardian and that TL should continue to live with the father under an interim residence order. Directions were given for the filing and service of a position statement by the guardian, and the time estimate for the hearing starting on 25 March 2013 was to be reduced to one day. The costs were reserved. 
19.	In circumstances where the mother had conceded residence of both children and did not seek any order for contact in the light of her express wish that this should be done on informal basis, the mother did not attend the final hearing on 25 March 2013, nor was she represented. 
20.	Prior to that hearing the mother had been served by the father’s solicitors with statements, various court bundles including a costs schedule and position statements on behalf of both the guardian and the father. There was no indication in any of the correspondence or in the notice of hearings that the father would seek directions that their children’s trust funds should be transferred to his control. Nor had he issued any application for such a direction. The only intimation was a brief statement “that the children’s respective trust funds be signed by [the mother] to my guardianship” which appeared in paragraph 8 of an unsigned position statement which appears to have been served on the mother’s solicitors on 18 March 2013. However it looks as though this statement only reached the mother under cover of a letter dated 19 March 2013 since by then she was acting in person. It is also of note that the father’s signed position statement dated 14 March 2013 contained no such statement in relation to the trust funds. It is not clear to me which version the mother received.
Discussion and determination

Paragraphs 5 and 6 of the Order - the children’s trust funds

21.	Paragraphs 5 and 6 of the Order relate to investment accounts which were apparently set up for the benefit of the children when the mother and father were married. HHJ Meston QC was not told on 25 March 2014 that those accounts had been the subject matter of consideration by DJ White in December 2009. DJ White had heard evidence in relation to the trust funds in contested ancillary relief proceedings, because the management of those trust funds was apparently an issue that was in contention during the course of that hearing. Following that hearing DJ White made an order dated 15 December 2009 which expressly recorded an undertaking from the father in the following terms:
“..and upon [the father] undertaking to the wife as a contract: (R) that he will transfer into the wife’s name the two children’s trust fund accounts currently held by her but vested in his name”. 
22.	Following that order, the children’s trust funds were duly transferred into the mother’s name. She is a qualified accountant and she had always previously been trusted by the father to liaise with the company managing the funds to make strategic decisions. As I have already said there was no formal application made by the father for a variation of this order and, despite the very brief reference to the proposal in the father’s unsigned position statement, the mother, perhaps unsurprisingly, was not aware that this issue would be raised with HHJ Meston QC on 25 March 2013. There was no evidence before the court on 25 March 2013 relating to what the trust funds consisted of, what mechanics were necessary for their transfer, nor what the father’s proposals were, nor as to why it was in the children’s best interests for them to be transferred to the father. Nor had the mother apparently received the schedule of issues or the draft order which Mr Howard, counsel for the father, had emailed to the court and to the guardian on the date of the hearing. 
23.	As I have already said, the judge made an order on 25 March 2013 in the terms already quoted that the father should be responsible for administering the child’s trust funds and that the mother should sign the necessary documents required to transfer the trust funds to the control of the father. The matter was dealt with in the absence of evidence in the briefest possible way at pages 82ff of the transcript. The judge was told that the funds related to sums of approximately £10,000 to £15,000 in total. But the court does not appear to have been given any details whatsoever as to who currently were the trustees of the funds, how they had been run in the past or any details of the order previously made by DJ White. No consideration appears to have been given as to whether the mother, as opposed to the father, was best placed to utilise her expertise for the benefit of the children or as to whether it was in the children’s best interests for the management of the trust funds to be transferred to the father. The only reason apparently put forward was the fact that the children would now be living with the father.
24.	At the hearing before us, Mr Howard recognised that, in all the circumstances, it was wholly inappropriate for the judge to have dealt with this matter at the hearing on 25 March 2013, effectively without notice and in the absence of any evidence relating to the constitution of the trusts, the formalities relating to any transfer or as to why it would be in the best interests of the children for the management of the trust funds to be transferred. 
25.	Mr Howard realistically accepted that permission to appeal should be given in relation to that matter and that the mother’s appeal should be allowed in relation to paragraphs 5 and 6 of the Order. Accordingly we indicated that we would grant permission to appeal, would allow the appeal in relation to paragraphs 5 and 6 of the order and set aside the order made by HHJ Meston QC. If the father in the future wishes to seek any order in relation to the transfer of the management of the children’s trust funds, then any such application must be made by him by proper notice to be served on the mother in the normal way.
Paragraph 9 of the Order – the issue of costs

26.	As I have already recited, paragraph 9 of the Order provided that the mother should pay the father’s costs in respect of all applications relating to the children since the order dated 15 May 2012 (including costs previously reserved but excluding the costs of the father’s application for an enforcement order) either in such amount as might be agreed or, in default of agreement, subject to a detailed assessment.
27.	The issue of costs was dealt with at pages 11 – 19 of the transcript. At page 18 the judge gave his judgment in relation to costs, in the following terms:
“having heard submissions, I am satisfied, unusually, this is a case in which a costs order would be justified. I am satisfied that the mother is on notice of the application and, in general terms, of the reasons for it and has chosen not to put in any response to the application or attend today. Therefore I will make an order. It seems to me as to the formalities Mr Howard I probably ought to specifically to say the mother shall pay the costs of the applicant father of what [sic]?
That was amplified at page 19 of the transcript by the judge ordering the mother to pay the costs of :
“the applications relating to the children….since order of 15 May 2012, excluding the father’s application for an enforcement order, including costs reserved in a sum to be agreed within 14 days …
The father’s solicitors had served a comprehensive “global” costs schedule before the hearing in a figure of approximately £23,763. However, this was subsequently revised upwards in a letter after the hearing to an all-inclusive figure of £25,281.28 including VAT.
28.	The mother puts forward two separate grounds on her appeal in relation to the costs. First, she submits that insufficient warning was given of the father’s application to seek an adverse order for costs or alternatively that the mother had a legitimate expectation that no adverse order for costs would be sought against her. Secondly, and substantively, she submits that the judge erred in failing to follow the presumption, well established in the case law, that there should be no order for costs in children’s proceedings absent unreasonable behaviour in the conduct of the litigation justifying such an order. Mr Adam Langrish, counsel for the mother, submitted that the judge not only failed to address whether there had been unreasonable behaviour but could not, on the evidential material before him, properly come to the conclusion that there had been such behaviour.
29.	I deal first of all with whether sufficient notice was given to the mother that the father would seek an adverse order against the mother. It is pertinent to note in this context that the second recital to the Order states that “the court being informed that the mother had been notified of this hearing and of the application for an order for costs”. 
30.	Whilst the orders made previously on the various applications since May 2012 had reserved the question of costs, there was nothing in the correspondence from the husband’s solicitors which stated either expressly, or even hinted, that the father would be seeking costs because the mother had behaved unreasonably in the conduct of the litigation. Indeed the judge commented to that effect at page 2 of the transcript. Whilst both parties had traditionally served on each other running costs schedules throughout each set of proceedings, there was no indication in the correspondence between the father’s solicitors, NGA, on the one hand and Redferns, the mother’s previous solicitors, or the mother, when unrepresented, on the other that the father was going to take the attitude in relation to the reserved costs that the mother, because of her unreasonable conduct of the proceedings, should pay the entirety. Thus, for example, whilst various orders had reserved the costs to the conclusion of the present proceedings, the order dated 11 February 2013 recited that the court had been informed 
“that the issues which remain to be at determined are the future residence and contact arrangements for BL and that the parties do not consider that any form of mediation is presently possible”. 
31.	I accept Mr Langrish’s submission that in the light of the way the litigation had historically been conducted between the parties the mother would not have had any expectation that an order for costs on the basis of her unreasonable conduct would be sought at the hearing on 25 March 2013. For example, at the previous final hearing heard by DJ Willis on 14 and 15 May 2012, the bundle contained 8 costs schedules that had been filed by the father in the preceding 2 years. But it is of particular note that, despite finding against the mother in relation to the father’s application to vary a shared residence order, and making a residence order in respect of BL in favour of the father on 14 May 2012, DJ Willis made no adverse order for costs against the mother. I refer to the note of his judgment prepared by Mr Howard from which it is clear that DJ Willis took the view that the making of an order would have had a detrimental impact on the children.
32.	In this context I also refer to the letter sent by the father’s solicitors dated 14 March 2013 which I have already quoted. The reasons for NGA refusing to agree to the consent order proposed by the mother did not include any suggestion that a court hearing had to take place in order that an adverse order could be made against her in respect of reserved and other costs. The opposition was entirely based on the father’s insistence that he wished the question of contact to be resolved at a final hearing in court, despite the mother’s expressed view that she did not want a formal contact order. (Indeed it is relevant to note that, despite the father’s insistence on the inclusion of such an order, no formal contact order was in fact made in the Order itself.) In my view, in all the circumstances, it was incumbent upon the father’s solicitors to draw the mother’s express attention to the fact that the father would be seeking an adverse order for costs against her on the grounds of her unreasonable conduct.
33.	Moreover, there was no evidence before HHJ Meston QC that could have provided him with any confidence that the mother, by then an unrepresented litigant in person, anticipated that the issue of costs was going to be raised contentiously on 25 March 2013. At the very least, given the correspondence and the wife’s acceptance that she was not going to be seeking any orders or opposing the father’s application for a residence order in relation to TL, the judge should, in my judgment, have afforded the mother an opportunity to make representations to the court, either by adjourning the issue relating to costs or by providing the mother with express liberty to apply to vary or discharge any costs order which he made. As Mr Langrish pointed out, it is also significant that at the directions hearing before the judge on 15 March 2013, listed at short notice in relation to the father’s uncontested application for residence of TL, no indication was given in the directions that issues of costs were going to arise.
34.	Accordingly on this ground alone I would have granted permission to appeal and would have allowed the appeal.
35.	However, Mr Langrish also challenges on substantive grounds the order made by the judge that the mother should pay the costs. He invites this court to allow the appeal, set aside the order of the judge and to make an order that there should be no order in relation to the parties’ costs since 15 May 2012. He submits that we have sufficient evidence upon which to do so in the materials before us. In the further alternative he also submits that the costs awarded were excessive and exceeded the period claimed in the father’s schedule of costs.
The relevant law
36.	In children’s proceedings there is no application of the general rule that costs will follow the event. Express statutory provision for this is made within Rule 28(2)(1) of the Family Procedure Rules 2010 (“FPR”) that specifically disapplies CPR Rule 44.2(2). Although the learned judge retained a discretion to make an adverse order for costs as he thought just (see rule 28.1 of the FPR), there is little doubt that the general rule is that the discretion to make an adverse order for costs is only exercised in exceptional circumstances or where there has been unreasonable behaviour. 
37.	The relevant principles are set out in re T (Order for costs) [2005] 2 FLR 681, EWCA Civ 311. In the court of appeal, Potter and Wall LJJ said as follows:
“[36] The principles, which fall to be applied, are not, we think, in dispute. The judge summarised them succinctly in the following way: -
“2.1 The Civil Procedure Rules apply. Under normal circumstances, according to rule 44.3(2)(a) [now rule 44.2(2)(a)] the general rule is that costs should follow the event, although the court can make a different order. (Rule 44.3(2) (b) [now rule 44.2(2)(b)])
2.2 However, this general rule does not apply to family proceedings. (Family Proceedings (Miscellaneous Amendments) Rules 1999)
2.3 It is suggested that even in family proceedings, the general rule is probably the starting point but can more easily be displaced. (Gojkovic v Gojkovic (No 2) [1992] Fam 40)
2.4 In cases involving children in particular, costs awarded against one parent or another are exceptional since the court is anxious to avoid the situation where a parent may feel “punished” by the other parent which will reduce co-operation between them. This will only impinge ultimately on the welfare of the child or the children concerned. (London Borough of Sutton v Davis (Costs) (No2) [1994] 2 FLR569; Re M (Local Authority's Costs) [1995] 1 FLR 533)
2.5 The conduct of the parties is in reality the major consideration when deciding whether or not an exceptional order for costs should be made. It should only be made if the penalised party has been unreasonable in his or her conduct. Moreover the “unreasonableness” must relate to the conduct of the litigation rather than the welfare of the child. (R v R (Costs: child case) [1997] 2 FLR 95) [my emphasis]
2.6 One has to be very careful in this distinction when, as in the case of (the mother), the apparent unreasonableness is as a result of the personality of the relevant party. In such circumstances, there is often an overlap of that party's conduct of the litigation and the conduct relating to the welfare of the child.
2.7 At the beginning of my involvement (the father) was applying for contact in relation to A as well as J. His welfare has also been a concern from time to time throughout. However, the costs in dispute have been incurred in relation to J's welfare alone.
………………….”
[46] Despite the extensive citation of authority, we think the principles governing the award of costs in children's cases are well established, and more than adequately summarised by the judge in the extract from her judgment, which we have set out at paragraph 36 above.”
38.	Indeed there was no real dispute between counsel on the appeal that, as most recently summarised in Re T [2012] UKSC 36, there should be no order for costs in the absence of reprehensible behaviour. In that case, Lord Phillips of Worth Maltravers PSC, handing down the judgment of the court, said as follows:
“[44] For these reasons we have concluded that the general practice of not awarding costs against a party, including a local authority, in the absence of reprehensible behaviour or an unreasonable stance, is one that accords with the ends of justice and which should not be subject to an exception in the case of split hearings. Judge Dowse's costs order was founded on this practice. It was sound in principle and should not have been reversed by the Court of Appeal.”
Despite the fact that Re T was a local authority case the principle is clearly apposite here.
39.	In my judgment there was no basis in the present case for the judge concluding that the conduct of the mother in the conduct of the litigation since May 2012 was in any way unreasonable or reprehensible. Certainly there was nothing in her conduct that justified an adverse order for costs against her contrary to the normal principles in child care proceedings. 
40.	Prior to the order of 15 May 2012 the CAFCASS report recorded that BL was very clear throughout the meeting that he wanted to live with his mother and sister TL and not with his father. In the latest report before the court hearing dated 8 May 2012 the CAFCASS officer concluded that:
“This is a very disturbing and distressing family situation for the children to have been witness to. There is no right or wrong answer and I believe both children will bear the scars of their parents’ separation and of these proceedings into adulthood. I believe that my last recommendation for BL to remain with his mother runs counter to my considered assessment. I think that on balance BL should probably return to live with his father but I am extremely worried about the effect upon BL of this removal back to his father’s care. Unless both of his parents support this move, there are serious risks involved for BL’s emotional state.” 
Mr B also made it clear that he was confident in the ability of both BL’s parents to meet his needs on a daily basis.
41.	Thus it can be seen that the decision of DJ Willis that BL should reside with his father contrary to BL’s expressed wishes and at a time when, contrary to the previous residence order, he was in fact living with his mother, was a finely balanced decision in difficult circumstances against a history of difficult contact arrangements. That was the starting point against which the mother’s conduct thereafter has to be judged.
42.	After the order was made, significant difficulties persisted in relation to BL returning to live with the father after contact with the mother. This gave rise to considerable problems at school because of BL’s reluctance to return to stay with his father and the continued expression to the CAFCASS officer and others of his wish to reside with his sister, TL and his mother. 
43.	As at the date of DJ Willis’s order dated 15 May 2012, the position in relation to TL was that she refused to have anything to do with her father and was living with her mother. As I have already explained, as a result of the problems relating to BL not wishing to return to his father after contact with his mother, both the father and the mother issued applications for leave to make applications in relation to him notwithstanding the terms of the previous order of 15 May 2012. The mother was granted specific leave by DJ Willis on 27 November 2012 to make an application for a residence order in relation to BL. Unless she had been given specific permission to do so, she could not have made an application due to the previous prohibition made under Section 91(14). DJ Willis was the very same judge who had imposed the prohibition on the parties 6 months earlier. As Mr Langrish submitted, DJ Willis had a detailed knowledge of the parties, the children, the case and the history of the proceedings and yet he considered it appropriate to permit the mother to file an application for residence in relation to the father’s application for change in contact. Although HHJ Meston QC was made aware of there having been such a prohibition order in place, no further reference was made at the hearing on 25 March 2013 to the fact that DJ Willis had subsequently considered that it was reasonable for the mother to bring a further application for a residence order in the changed circumstances. Although the judge was informed of the order dated 27 November 2012 allowing both parties leave to make their applications, the father’s application for costs was argued on the basis that the mother’s repeated application for a residence order in relation to BL was an unreasonable application from the start and for that reason she should pay the costs. 
44.	But that simply was not the case. The judge appears to have given no weight to the fact that the mother’s application had been assessed and determined as having sufficient merit to justify leave being granted by DJ Willis. Indeed the mother’s cross-application was, at the time it was made in November 2012, clearly in accordance with BL’s wishes and feelings as repeatedly recorded in the various CAFCASS reports that were prepared by Mr B, the CAFCASS officer, during 2012 and by Mr R, the subsequent CAFCASS officer, as recently as January 2013. 
45.	This was clearly a very sensitive and difficult family situation. Thus as late as January 2013, the position statement of the guardian was that BL’s wishes and feelings were that he wanted “to spend more of his time with his mother and sister.” Prior to February 2013 the position which was considered by the professionals and the mother was that BL’s distress at being in the care of his father was attributable to his express preference to be cared for by the mother; e.g. see paragraph 41 of Mr R, the CAFCASS officer, report dated 8 March 2013. Until February 2013 the evidence clearly suggested that the correct place for BL’s residence was a finely balanced issue notwithstanding that the issue had been litigated previously. The true position only really emerged clearly in February 2013 when TL stated that she no longer wished to live with her mother for various reasons. What only then became clear was that it was BL’s wish to live with his sister that was the driving force behind his wish to live with either his father or his mother, as the case might be. I therefore accept Mr Langrish’s submission that it was incorrect of Mr Howard to suggest to HHJ Meston QC that the most recent proceedings were “essentially re-litigating for the third time matters which had been resolved [in] two previous proceedings with no substantive change in circumstances.” That was not the correct characterisation of the proceedings. What had changed over the period since May 2012 was: (a) TL’s attitude to renewing contact with her father; (b) her disagreements with her mother and wish to live with her father; and (c) the emergence of the fact that the reason for BL’s unhappiness about living with his father was  that he was not seeing enough of his sister.
46.	As I have already said, in early February 2013 the father had contact with TL for the first time. The mother and TL were experiencing real difficulties in their relationship such that the mother agreed that both children should spend half term with the father. In February 2013 the mother reacted sensibly and proportionately to the rapidly changing circumstances. The significant development arose in relation to TL who no longer wanted to live with her mother. In those circumstances the mother attempted to convene an urgent directions hearing to which the father refused to agree. But what the chronology shows is that the mother, then represented by solicitors, was, whatever her shortcomings, attempting to be pragmatic. The reality was that she was prevented from returning matters to the court any sooner. Once Mr R’s final report had been distributed, the mother, by her solicitors wrote to all parties within a week of it having been received to confirm she would be conceding residence of both BL and TL, to which the mother had agreed, even prior to her being informed that the father had issued an application for a residence order in relation to TL. Given the mother’s position there was in fact no need for the father to have incurred further costs by pursuing his application for residence of TL since the mother had agreed to that in any event and a consent order could have achieved the necessary finality. 
47.	Accordingly I agree with Mr Langrish’s assessment that, in reality, and in a difficult situation where the mother was clearly having problems with both TL and BL, she acted in accordance both with the conclusions of the professionals and the change of views held by her children. I agree she took all reasonable steps to avoid the need for a final hearing. None of these factors appear to have been taken into consideration by HHJ Meston QC. In circumstances where she was paying privately for representation and had sought to withdraw her application for residence, it is hardly surprising that she did not seek to attend the hearing on 25 March 2013. 
48.	In my judgment the mother behaved responsibly and proportionately in deciding to withdraw her application within a week of receipt of the final CAFCASS report. It was not the case, contrary to what was said at the hearing on 25 March 2013, that the father had been required to answer the mother’s application. The real position was that, given the real difficulties in relation to BL’s reluctance to live with his father, there was a need for the matter to be brought back to the court. The reality was that in the space of a few weeks the mother was faced with losing residence, not only of BL but also of TL, who had lived with her for many years. The position had substantially changed since May 2012; the family was facing numerous challenges including the problems of teenage or pre-teenage children who had difficulties both with their father and their mother. None of these considerations appear to have been weighed in the balance by the judge. Nor perhaps unsurprisingly, in the absence of legal representation for the mother, was the judge’s attention drawn in the context of costs (in so far as it was relevant at all), to any of the criticisms from the CAFCASS officer in relation to the father. 
49.	In my judgment there is nothing in the mother’s conduct of the proceedings that could be characterised as unreasonable or reprehensible. She was faced with extremely difficult problems relating to the residence and schooling of her children; the fact that she may have had inadequacies as a mother in dealing with her children was no reason for visiting the costs of these proceedings on her. When it came to the point, she reacted proportionately and fairly and sought to save costs. The fact that she is not currently having contact with the children but hopes to do so in the future once emotions have settled, is in itself no reason for visiting the costs of these unfortunate proceedings on her. Accordingly I conclude that it was wrong in principle and on the facts for the judge to have made an order for costs against her.
Disposition
50.	Accordingly I would grant the mother an extension of time within which to apply for permission to appeal (as to which there was no dispute). In relation to both her grounds of appeal, I would give permission to appeal. I would allow the appeal in relation to paragraph 5 and 6 of the Order and set those paragraphs aside. I would also allow the appeal in relation to paragraph 9 of the Order and (subject to any comments from counsel on the precise form of the order) substitute an order in the following terms:
“There shall be no order as to the costs of either party in relation to the reserved and other costs of the applications relating to the children since the order of 15 May 2012.”   
Lord Justice Kitchin
51.	I agree.
Lady Justice Black 
52.	I also agree.