Monthly Legal Costs Update – June 2025
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.
This Monthly Legal Costs Update June 2025 has been written by Nick McDonnell and Colin Campbell.
A new category of judgment is developing known as a “consequentials” judgment. Pre the implementation of the Civil Procedure Rules, the usual order at trial was that where “costs follow the event”: the party who wrote the cheque, however small the amount, was the loser, and would be ordered to pay the costs to the recipient of the cheque, to be taxed if not agreed. That all changed with the coming into force of the CPR in 1998 and the court will look at levels of success and the costs of issues won and lost, when deciding who should pay what. This month, we report on three “consequentials” judgments.
In Peter Waddell Holdco Ltd v Bluebell Cars Holding Ltd [2025] EWHC 36 (Ch) (15 January 2025 – judgment just published), Trower J dealt with the costs of various interlocutory matters (such as the costs of amendments to an unfair prejudice petition), whether the costs should be paid on the standard or indemnity basis, and whether there should be a summary or detailed assessment. Whilst the hearing had been completed in one day, there needed to be apportionments in respect of the overall costs totalling £500,000. These included hourly expense rates at up to 250% above the guideline rates, so Trower J decided that summary assessment was inappropriate and ordered a detailed assessment, with payments on account ranging between 55% and 70% of the sums sought.
Second is Mrs Vardy’s last throw of the costs dice in Vardy v Rooney [2025] EWHC 1027 (KB) (29 April) in which Cavanagh J, having dismissed her appeal, considered the factors to apply in deciding whether Mrs Rooney’s costs of the appeal should be reduced due to lack of success in her respondent’s notice. Mrs Vardy lost that point, with the judge directing that the assessor who sat with him, should summarily assess the costs of the hearing, rather than for the issue to be remitted to the costs judge who will be carrying out the detailed assessment of the costs of her failed libel action.
Finally, in Carl v Hawkins [2025] EWHC 1104 (Ch) (7 May) Simon Gleeson dealt with complex costs issues arising out of a 435 paragraph judgement delivered a year earlier, including the parties’ pre-action conduct and the equitable jurisdiction to award interest on costs. Of note are the judge’s comments about the meaning of “costs thrown away” by reason of an adjournment. He elided those with “wasted costs” and directed that they were unsuitable for summary assessment. Accordingly, there needed to be a detailed assessment. The judge also gave guidance about interest, deciding that this should be paid at 2.7 percent over base compounded annually.
Next a warning to legal representatives to check that the cases they cite to the court really exist! Frederick Ayinde, R (on the application of) v The London Borough of Haringey [2025] EWHC 1040 (Admin) (3 April) was a judicial review involving a housing matter in which the defendant local authority had failed in its application for relief from sanctions to enable it to participate in the trial. Nonetheless, it was permitted to make an application for a wasted costs order against the claimant’s solicitors and counsel on the grounds that the submissions that had been filed in support of the judicial review, had cited case law that had been “manufactured”. Ritchie J agreed. Putting fake cases into a pleading was wholly improper. These were not “minor citation errors” or “Cosmetic errors.” It was the responsibility of the legal team to see that the statement of facts and grounds were correct. Due to the appalling professional misbehaviour, the justice of the case required the court to make a wasted costs order against both the solicitors and counsel.
Next an unusual case about fixed costs. In Makeality Ltd v City Doggo Ltd [2025] EWCA Civ 400 (11 April), the Court of Appeal had to decide whether a claim in the IPEC worth under £10,000 should remain in the multi-track or be transferred to the small claims track notwithstanding Directive 2004/48 article 14. It was the claimant’s case that the small claims track costs regime did not comply with article 14 which required intellectual property cases to be tried in a forum that allowed for the award of a significant and appropriate part of the winner’s reasonable legal costs. The court held that following the Retained EU Law (Revocation and Reform) Act 2023, which provided that no general principle of EU law was part of domestic law after 31 December 2023, it was no longer open to the claimant to advance an argument based on article 14 having direct effect. In any event, the claim was below £10,000 and could be tried in one day. The judge below had been entitled to conclude that the action should be allocated to the small claims track, so the appeal was dismissed.
In Jones v Persons Unknown & Ors [2025] EWHC 977 (Comm) (29 April), Louise Hutton KC was required to decide a novel point in relation to security for costs under CPR 25. Could Mr Jones as a claimant, apply for security against a non-party applicant which had made an application to set aside a summary judgment granted on 5 September 2022? Expressed another way, could that non-party applicant be regarded as a claimant for the purpose of a security for costs application? The judge held that it could not. The application was being made in existing proceedings and CPR 40.9 permitted a person who was not a party to apply to set aside a judgment. That provision necessarily contemplated the non-party becoming involved in the existing proceedings. The relevant claim or proceeding for the purpose of the rule was that brought by the claimant, Mr Jones. It followed that the non-party was not a claimant, CPR 25 was not available for Mr Jones to deploy, so his application failed.
Next, costs budgeting and variations under CPR 3.15A. In BDW Trading Ltd v Ardmore Construction Ltd [2025] EWHC 1063 (TCC) (2 May), an argument by the claimant that the court had no power to make a costs management order (CMO) after a costs and case management conference (CCMC) had taken place, met with no success. Andrew Mitchell KC held that a CMO can be made at any time under CPR 3.15(2) and in the case before him, subsequent to the first CCMC based upon the costs budgets filed for consideration at that hearing. Having made a CMO, it followed that subsequent revisions fell to be dealt with under CPR 3.15(A) and the judge permitted adjustments for leading counsel’s fees on witness statements, disclosure and incurred costs in sums below those sought. Finally, another decision of the Court of Appeal. HM Treasury v Global Feedback Ltd [2025] EWCA Civ 624 (13 May) concerned the Aarhus Convention. The court rejected the claimant’s submission that a judicial review fell within Part IX of CPR Part 46 so that the costs limits in that Part should apply. The challenge in question advanced by the claimant had amounted to allegations of breaches of public law principles and not to any breach of this country’s law relating to the environment or environmental law. It therefore fell outside the scope of Art.9(3) of the Convention, and any costs protection could only be considered through an application for a costs protection order.
