Costs News

24 February 2021
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Judge was wrong to strike out points of dispute, Upper Tribunal rules

The First-tier Tribunal (FTT) was wrong to strike out points of dispute (PoDs) filed as part of a detailed assessment in response to a failure to comply with an order to make an interim payment, the Upper Tribunal has ruled.

Judge Elizabeth Cooke said the FTT erred by not making an unless order first.

The appeal in Astor Bristol Ltd and Ors v Bristol School of Performing Arts Ltd (LAND REGISTRATION – COSTS) [2021] UKUT 43 (LC) arose from a successful application by the respondent BSPA to rectify the register of title for a property it occupied.

The appellants were ordered to pay the BSPA’s costs on the indemnity basis and to make an interim payment of £48,185 by 22 May 2020. On 5 June, the FTT refused the appellants’ application for an extension of time to make the interim payment.

Meanwhile, the BSPA filed its bill of costs, claiming £142,502, and the appellants filed their PoDs. Had all their points been successful, they would have had to pay £72,458, Judge Cooke observed.

On 9 July, the BSPA applied for what it called “debarring and/or unless orders” because of the failure to make the interim payment. The FTT – having refused the appellants an extension to the seven days it gave them to respond – chose the former, striking out the PoDs already filed and awarding the claimed costs in full, as well as the costs of the application on the indemnity basis.

The FTT judge said her order was made under the FTT’s “wide powers to manage litigation under rules 6 and 8, in accordance with rule 3 and the requirement to manage it in accordance with the overriding objective”.

On appeal, Judge Cooke found that the FTT did not have the jurisdiction to make the order: “Rule 3 sets out the overriding objective, and rule 6 gives the FTT power to regulate its own procedure, but the rules then go on to make specific provisions about a particular order, and those specific provisions govern the FTT’s jurisdiction to make that particular order.

“Neither rule 3, nor rule 6 nor rule 8 gives the FTT power to strike out the whole or part of proceedings otherwise than in accordance with rule 9.”

The FTT could have struck out the PoDs in response to the failure to make an interim payment, the judge said, but only by first making an unless order in compliance with rule 9(3)(a). The FTT did not and so there was no jurisdiction to strike out the PoDs.

Judge Cooke set aside the order and everything that flowed from it, and said there was no need to remit the matter as the interim payment had by then been made. She re-made the FTT’s decision by refusing to make either of the orders sought by the 9 July application and said the detailed assessment process could now go forward.

The appellants were unrepresented. Simon Atkinson for the respondent

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