Civil Costs Case Law Update – March 2024
King v DWF LLP [2024] EWHC 668 (Comm) Henshaw J- 2 February 2024. The court refused to carry out a summary assessment of the defendants’ costs (claimed in the sums of £1,553,689 and £2,745,673) respectively following a five week trial. Whilst a detailed assessment might cause the defendants to throw good money after bad given the claimants’ impecuniosity, the appropriate order was to direct payments on account (£1,085,000 and £1,750,000 respectively), with the time for applying for detailed assessment to be extended. If the money was not paid on time, the defendants could return to court for a summary assessment.
Heathcote v Asertis Ltd [2024] EWCA 242 (Civ) Lewison, Males LJJ 14 March. Trial costs. A single claim form had been issued to start two claims which were capable of disposal within the same proceedings. The Claimant succeeded in one claim and failed in the other. On appeal by the defendant, the court held that in ordering the defendant to pay 75% of the Claimant’s costs, the Judge had not erred in exercising his discretion. The parties had not invited him to distinguish between the claims for the purpose of the costs order and had, in fact, asked the judge to consider the question of costs globally.
Deutsche Bank v Sebastian Holdings [2024] EWCA Civ 24 March- Males, Popplewell, King LJJ 14 March. Interest on costs. The Limitation Act 1980 Pt I s.24(2) provided that “No arrears of interest in respect of any judgment debt shall be recovered after the expiration of six years from the date on which the interest became due.” Below, Dias J held that “due” meant the date on which the interest liability accrued which was on the date of the Costs Order on 8 November 2013. Since the detailed assessment had not been completed until 2023, that had meant that the bank could not collect 3 ½ years’ interest on the assessed costs, worth £775,000. That decision had been wrong. “Due” meant “payable” and where costs were ordered to be assessed, time began to run for limitation purposes on interest on those costs from when the costs were quantified in the final costs certificate, which was when they became enforceable. Appeal allowed.
Rainer Hughes Solicitors v Liverpool Victoria Co Ltd [2024] EWHC 585 (KB) Martin Spencer J- 15 March. Wasted costs orders. There was a public interest in costs which had been wasted as a result of a solicitor’s negligence or misconduct in the proceedings being visited on the solicitor in the form of a wasted costs order. The judge below had been entitled to order the claimant’s solicitors to pay wasted costs in a personal injury claim, and the costs of the wasted costs application, on the basis that their failure to provide properly translated statements for the claimant was negligent and a breach of its duty to the court.
Hadley v Przybylo [2024 EWCA (Civ) 250-Coulson, Dingemans, Birss LJJ-15 March. Below, the Master had disallowed at a costs budgeting hearing, £52,000 worth of future costs of a fee earner’s attendance at rehabilitation case management meetings, because these were not “incurred in the progression of litigation”. Held – costs incurred by a fee earner in attending case management meetings with medical and other professionals regarding the injured party’s rehabilitation needs, and meetings with financial and Court of Protection deputies regarding matters relevant to the Schedule of Loss, were recoverable as costs in the litigation. The precise amount of recoverable costs depended on the facts of each individual case and would be the subject of detailed assessment; it was not appropriate to set out any general guidance or rules. Appeal allowed.
Bell v Commissioner of Police of the Metropolis [2024] EWHC 650 (KB) Hill J – 21 March. Where the claimant had beaten his own Part 36 offer, the CPR 36.17(4) benefits would apply. Due to the defendant’s conduct which had prolonged and exacerbated the claimant’s distress, the enhanced interest would be 10 above base rate on damages awarded. The additional sum would be 10% of £104,399.48 for general damages and past losses (future estimated losses excluded), plus indemnity basis costs from the date that the offer should have been accepted. Interest would be allowed on those costs at 10% above base rate plus a payment on account of 90% of the claimant’s budgeted costs, that being the “common” figure to allow.
Coram v DR Dunthorn & Son Ltd [2024] EWHC 672 (KB) Yip J -22 March. Following the settlement of a mesothelioma claim for £75,000, the claimant had served a bill for £178,207 net of VAT. That had included a brief fee for leading counsel for the trial of £25,000 plus 27.5% success fee discounted by 50% of the full fee to reflect the stage at which the settlement had occurred. Below, the Master had disallowed the brief fee. That decision had been correct. The case had been listed category C and the costs judge had been entitled to weigh the absence of any explanation from the Appellant’s solicitor or junior counsel as to the thought process which justified the significant and costly decision to instruct leading counsel. Appeal dismissed.
Various Claimants v Mercedes-Benz Group AG [2024] EWHC 695 (KB) Cockerill, Constable JJ -25 March. The NOx Emissions Group Litigation. The issue for the court was whether a disclosure order should be made apropos the funding of the litigation, with a view, if appropriate, to apply for security for costs under CPR 25 against someone other than the claimant. Held: the court’s power under CPR 25.14 was not limited to those in a direct contractual relationship with the claimants. It would be wrong in principle that the power could be defeated simply by inserting a vehicle in between the claimant and the funder. However, disclosure of a funding agreement would not be ordered, but the issue would be re-visited after (a) budgets through to 2025 had been fixed and (b) the Claimants had had the opportunity to make good their intentions as to the provision of ATE insurance, which could make the question of security would be redundant.
Brearley v Shepherd & Co [2024] EWCA (Civ) 303 Coulson, Nugee LJJ Sir Nicholas Patten -26 March. A residual beneficiary had challenged the entitlement of one of the executors to charge fees for administering his late mother’s estate where there was no charging clause in her will. Upholding the decision below, the court held that the executor would need to rely on (i) s.29 of the Trustees Act 2000 which required “each other trustee” to agree in writing to the executor’s remuneration or (ii) the inherent jurisdiction of the Court to a permit such remuneration. Since not all trustees had agreed and in the absence of any evidence to explain the lack of a charging clause in order to justify the exercise of the inherent jurisdiction in the executor’s favour, the appeal failed.
ABFA Commodities Trading Ltd v Petraco Oil Co SA [2024] EWHC 706 (Comm) Foxton J 27 March. On 16 October 2019, Petraco had made a valid Part 36 offer to settle for $24m. On 30 January 2024, the court upheld its claim for $27,034,184.87. So far as the CPR 36.17(4) consequences were concerned, the fact that there had been misconduct in the conduct of the action did not lead to the conclusion that the Part 36 consequences should be disapplied. The appropriate means of addressing disapproval of conduct was through the costs order made. It followed that taking the misconduct and all other relevant factors into account, the recoverable costs from 10 July 2021 would be reduced to 40% (but still on the indemnity basis), with standard costs at 100% to apply until that date.
