29.05.2012Syngenta Ltd.; Syngenta Crop Protection UK Ltd.; Syngenta Participations AG v Chemsource Ltd.; AgChemAccess Ltd.  EWHC 1507 (Pat)
Key areas: costs capping; High Court
This was a hearing to determine various Applications, including one by the Defendants for a Costs-Capping Order.
The main action was a patent dispute, with damages unlikely to exceed £50,000.00 at the trial listed for 17th-20th July 2012.
Up to 16th February 2012, the Claimants’ costs totalled £47,000.00, and had estimated future costs of £220,000.00, therefore totalling almost £270,000.00. The Defendants’ costs to 24th February 2012 totalled £19,000.00.
However, the Court held that on the facts of the case, “any disproportionate costs are more effectively controlled post-trial”, i.e. via Detailed Assessment. It also noted that given the trial was only 2 months away, a significant amount of the costs had already been incurred.
22.05.2012Eastenders Cash & Carry Plc & Anor v HM Revenue & Customs  EWCA Civ 689
Key areas: costs vs HMRC; Jurisdiction; Court of Appeal
This was an appeal over whether the Court had the power to award the successful Appellant costs against HMRC, due to the impact of s. 144 Customs & Excise Management Act 1979. This states that should there have been reasonable grounds at the time to seize goods for non-payment of duty, HMRC will not be liable for costs.
HMRC submitted that CPR 44 did not apply due to a statutory bar upon its effect.
The Appellant submitted that it did not apply because this case resulted from a set of judicial review proceedings, not from a civil claim. However, this was dismissed because there was no reason why judicial review should not be classed as a civil claim.
The Appellant then submitted that the statue was a breach of Art. 6 ECHR, because there should not be a one-way bar “irrespective of the merits”. This too was rejected because the right to a trial was not affected, nor where signatory countries to the ECHR required to provide the ability to claim costs.
Overall, the appeal was dismissed.
16.05.2012Henry v News Group Newspapers Ltd. (Rev 1)  EWHC 90218 (Costs)
Key areas: costs budgets; SCCO
This was a preliminary hearing to deal with issues over costs budgets in defamation proceedings.
In the main action, the Claimant’s costs budget had been approved on 20th September 2010, at a total of £381,305, but she claimed costs totalling £650,137.
The Claimant submitted that the costs exceed the budget due to the Defendant’s actions, including that it re-amended its Defence, and served 10 additional Lists of Documents, and had increased its defence from stating that the Claimant had acted “incompetence” to “criminal incompetence”. She also submitted that the defendant had not relied upon her budget when it came to settling the claim. As a result, this was a “good reason” to depart from the budget.
The Defendant submitted that the Claimant did not comply with the Practice Direction, and so neither they nor the Court were aware of the issues over costs. It also submitted that it was first aware of the problem less than a month before the trial was due to start, and that the Claimant had not attempted to get their budget increased, in spite of the amount of extra work which was being done. In addition, the Defendant advised the Claimant that its own costs had increased, and that it was likely to exceed its budget, but the Claimant did not respond.
The Court held that due to the Defendant’s conduct that “the Claimant would be able to argue very strongly that the costs incurred were both reasonable and proportionate” at a Detailed Assessment; however this hearing was a DA and the Claimant did not seek to increase her budget.
The Court noted that the Practice Direction contained mandatory terms that the parties “must” update their budget, and advise if it is to be exceeded.
As a result, it was held that the Claimant was limited to her costs budget.
10.05.2012PHI Group Ltd. v Robert West Consulting Ltd.  EWCA Civ 588
Key areas: Part 36 offer; contribution; Court of Appeal
This was an appeal over how much each party was to contribute towards the costs of a successful third party.
The third party had settled their claim with PHI for £3.8 million. At the first instance trial, PHI had been held to be 60% liable, with Robert West (RWC) liable for the remaining 40% of the damage. Overall, RWC had been ordered to pay £3.25 million, out of a total judgment for £6.7 million. In relation to costs, PHI had been ordered to make a 20% contribution towards the Claimants’ costs, as well as 30% of the costs of RWC, with no order for costs in relation to its own Part 20 claim against RWC.
PHI appealed against being ordered to pay RWC’s costs on the grounds that they made a valid Part 36 offer in February 2010 to settle liability on a 70%/30% basis, and before they issued the Part 20 proceedings, which was rejected, and not beaten at trial.
However, the offer letter did not state that it was open for at least 21 days, and so at first instance, and on this appeal was not considered to be a valid Part 36 offer.
At first instance, it was also held that the offer was withdrawn due to later offers, but this was overturned on appeal.
Overall, the Court held that a valid offer had been met, but not a Part 36 offer, with the effect that RWC were ordered to pay PHI’s costs of the Part 20 proceedings, and to bear its own costs.
08.05.2012M v London Borough of Croydon  EWCA Civ 595
Key areas: Judicial Review; Court of Appeal
This was a case to determine costs arising from a successful claim for judicial review.
The Claimant had undertaken proceedings to show that he was born in 1996, not 1994 as was maintained by the Council.
The Court noted that the claim was issued in February 2009, but they didn’t concede it until February 2011. In addition, the Claimant had served two letters that complied with the relevant Pre-Action Protocol, but a response was not received. However, it stated that until a certain point, the Council’s defence was reasonable.
In the circumstances, the Court awarded the Claimant 50% of his costs until the date that permission was granted to bring the proceedings, and was awarded his costs in full thereafter.
01.05.2012Cawdery Kaye Fireman & Taylor v Minkin  EWCA Civ 546
Cawdery Kaye Fireman & Taylor v Minkin  EWCA Civ 546 (01 May 2012) – Key areas: retainer; Solicitor/Own client; termination of retainer; Court of Appeal
This was a second appeal by the Solicitors against a ruling that it was not entitled to terminate its retainer with the ex-client.
The Solicitors were instructed to act in June 2009 in a set of divorce proceedings. They gave an initial estimate of £3,000.00 + VAT, with an interim payment of £2,000.00. In the retainer letter of 14th July 2009, this estimate was increased to £3,500.00 + VAT, i.e. £4,200.00.
The day before the hearing was due to take place, it was discovered that the client’s ex-wife had left their home and had rented it out.
On 30th July 2009, the Solicitors sent an interim invoice for a total of £5,472.50, which comprised profit costs of £3,490, disbursements of £1,271.50 and VAT. The client complained about the size of the Bill, and the Solicitors replied that they had to do £700.00-wirth of extra work as a result of the tenancy.
The client and solicitors then entered into correspondence regarding the work done and costs incurred, with both sides being aware that the client was lacking funds at the time.
Eventually, the client stated that he felt “badly let… down” and asked “Why should I have any faith in your ability to get this matter resolved?”.
As a result, the solicitors sent a final Bill and came off-the-record.
At a detailed assessment, the client submitted that the solicitors were in breach of their retainer. The judge agreed with this, but assessed the Bills – on the assumption that this was wrong – at £5,721.25, with the client being awarded costs of detailed assessment of £17,650.
The Solicitors asked the Judge to re-consider his ruling at a later ruling, but he upheld it, stating that “the solicitors repeatedly threatened to down tools and actually downed tools”, which was “a major breach”.
This too was appealed, but was dismissed on the grounds that the client was right to object given the difference between the bills and estimate and his limited funds.
On this appeal, the Court held that s. 65(2) Solicitors Act 1974 did not apply because there was no notice that the solicitors would withdraw should there not be a payment on account.
The Court then turned to cl. 6 & 13 of the Solicitors Terms of Business. Clause 6 dealt with suspension of services; clause 13 covered termination of the retainer.
The Court noted that the client was given notice that he had to pay or else further work could not be done. It also noted that the client had disputed the costs incurred. However, it stated that a complaint “cannot assist him if [it] is not a reasonable justification in itself”. It also noted that the solicitors use of the term “until we are in funds” meant that they would suspend their services.
The held that the retainer was in fact terminated by the client when he emailed the solicitors stating that he had lost confidence in them. Therefore, the Solicitors were entitled to claim their costs.
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