Costs News

09 January 2019
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News in brief: 10.01.2019

CA refuses appeal over costs-only proceedings

The Court of Appeal has refused to hear an appeal against the decision that a claimant is able to issue proceedings solely in pursuit of costs which the defendants had refused to pay in negotiating a pre-action settlement.

At trial in Ayton v RMS Bentley Jennison and Ors, the claimant then beat his part 36 offer on the costs. The master refused to apply the part 36 consequences on the grounds that the claimant had not been justified in issuing proceedings to obtain his pre-action costs in circumstances where an offer of the full amount of the claim had been made. Mrs Justice May overturned this ruling.

In refusing permission for a second appeal, Lord Justice Lewison noted that Mrs Justice May had accepted that it was legitimate for Mr Ayton to have issued proceedings in the face of the refusal to pay his costs.

“From that starting point, it followed inevitably that the part 36 regime would apply to the litigation. The only question for the judge was whether it would be unjust for Mr Ayton not to recover his costs in accordance with part 36, having beaten the offer at trial,” he wrote in his order.

“The cases are unanimous in stating that the test of injustice is a high hurdle; and it is essentially a value judgment for the judge to make.

“In circumstances in which the point of the proceedings is to recover the costs, I find it hard to see how it could be unjust to deprive Mr Ayton of his costs. As the judge pointed out, it was always open to the defendants to accept the part 36 offer.”

Lewison LJ concluded that the appeal had no real prospect of success, nor did it raise an important point of principle or practice.

Bolt Burdon Kemp acted for the claimant and Clyde and Co for the defendant.


Capped costs breakdown published

The Civil Procedure Rule Committee has published the breakdown of how solicitors can spend the £80,000 in costs that will be allowed under the capped costs pilot announced last year and coming into force on Monday in certain courts in London, Leeds and Manchester for cases worth up to £250,000.

The new Practice Direction 51W lists the maximum amount of costs per stage of the case:

Pre-action – £10,000

Particulars of claim – £7,000

Defence and counterclaim – £7,000

Reply and defence to counterclaim – £6,000

Case management conference – £6,000

Disclosure – £6,000

Witness statements – £8,000

Experts' reports – £10,000

Trial and judgment – £20,000

Settlement/negotiations/mediation – £10,000



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