Manchester Messenger – December 2024
Here, in Kain Knight Costs Lawyers’ regular monthly legal costs update, we focus on those cases which we believe are likely to have a practical relevance for its members. We welcome feedback and if there is an area, topic or case you would like us to address, please let us know.
A bumper month for costs judgments, so our summary of each is necessarily brief.
Starting with costs budgeting, A & V Building Solution Ltd v J &B Hopkins ltd [2024] 2914 (TCC) was the eighth judgment delivered by Roger Ter Haar KC in proceedings that were complicated and involved different Courts. In short, (the judgment is 231 paragraphs long,) having been asked to carry out a summary assessment following a five day trial in which the Defendant was entitled to set-off costs under Part 36, the judge refused to allow any increase from the Defendant’s budgeted sum (£78,978.50) to the sum claimed (£153,742.84) because no “good reason” under CPR 3.18 had been shown to depart from the last approved budget. Meanwhile in Krishna Holdco Ltd v Gowrie Holdings Ltd [2024] EWHC 2719 (Ch) Adam Johnson J declined to make the company in unfair prejudice proceedings, subject to costs budgeting where it was simply maintaining a “watching brief.” The petitioner contended that the company’s budget should be determined at nil. That submission failed because the court expressed itself to be very cautious about taking a step that might effectively preclude the company from obtaining recovery of its costs at some future time.
Finally, on costs budgeting, having assessed the claimant’s damages for tortious acts committed by the defendant and ordered it to pay costs, in FXS (through his father and litigation friend JLM) v The Mulberry Bush Organisation Ltd [2024] EWHC 2844 (KB), Ms Margaret Obi permitted at trial, an upward variation of the budget under CPR 3.15A. The trial had lasted nine days which had been unforeseen, and the budgets were approved in the increased sums claimed, with those costs to be assessed if not agreed.
Next security for costs under CPR 25. Below (see Parsdome Holdings Ltd v Plastic Energy Global SL)[2024] Costs LR 87), the court had made an order for security for costs which specified that payment into court had to result in cleared funds being received by the Court Funds Office within the deadline. That decision had been correct (see [2024] EWCA Civ 1293). Under CPR 25.12(3) the court making the order for security would direct the manner in which, and the time within which, the security had to be given. There was no reason in principle why the court could not order that a payment into court had to result in cleared funds being received by the CFO within the deadline. That was particularly so where time was of the essence.
Next summary assessment. AB v Social Work England [2024] EWHC 2874 (Admin) involved the assessment of costs following the appeal against a decision of Social Work England to remove the claimant’s name from the Register of Social Workers. Sweeting J dealt with the reasonableness and proportionality of the respondent’s costs by applying a broad brush: he reduced its schedule by 25%.
For a helpful guide about the principles to apply in the award of costs in the Competition Appeals Tribunal, see Walter Hugh Merricks CBE v Mastercard Inc (Costs) [2024] CAT 57. In these large and complex proceedings, Roth J dealt with payments on account in two preliminary issue trials, ordering the claimants to pay £5.37m and £1.3m respectively in respect of each.
In judicial review proceedings, in Director of Public Prosecutions v Northampton Magistrates’ Court [2024] EWHC 2860 (Admin), Eyre J had to decide whether he had the power to make a costs order in favour of the claimant following his successful application for judicial review of a district judge’s decision as to the costs of criminal proceedings. He held that in judicial review claims involving criminal causes, there was a choice between the regime under the Prosecution of Offences Act 1985 and the regime under the Senior Courts Act 1981. The 1985 Act regime was to be applied save in exceptional circumstances. On the facts of the case, it followed that he had no power to award costs and he dismissed the application.
Finally, in Filatona Trading Ltd & Anor v Quinn Emanuel Urquhart & Sullivan UK LLP (Re Costs) [2024] EWHC 2751 (Comm) the issue for the court was to decide whether the general order that the respondent should have its costs in Norwich Pharmaceutical applications, should apply. Calver J departed from the general rule. He held that the respondent law firm had acted unreasonably in refusing to answer questions as to the circumstances in which the material to be disclosed had been obtained and whether any steps had been taken to confirm its authenticity. For that reason, its costs were reduced by 20%.
As always, these are a selection of the principal recent cases which are likely to be of use to practitioners and if any further information is required, please contact either Nick McDonnell or Colin Campbell at Nick.McDonnell@kain-knight.co.uk or Colin.Campbell@kain-knight.co.uk
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