7 July 2022

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High Court issues costs sanction against successful claimant who failed to file N260

Judge forced to order detailed assessment but says defendants should not be exposed to costs of the process

A successful claimant who failed to file an N260 to allow the court to undertake a summary assessment of the costs of an application will not be able to recover the costs of the detailed assessment that has been ordered as a result, the High Court has ruled.

In Xl Catlin Insurance Company UK Ltd v Linkham Services Ltd & Anor [2022] EWHC 985 (Comm), His Honour Judge Pelling QC, sitting as a High Court judge, granted an order to lift a stay on a Tomlin order so that judgment be entered against each of the second and third defendants.

On the costs of the application, he ordered that the claimant should recover on the standard basis, saying this was a case in which a party had been forced to litigate in order to recover the sums which were due to it.

“If indemnity costs were awarded in every such case, then indemnity costs would become a very much more common feature of commercial litigation in England and that is not the basis on which indemnity costs are to be dealt with,” HHJ Pelling said.

He went on that he would ordinarily have expected an N260 setting out the costs which were being claimed “so that a summary assessment could be carried out in accordance with the default provisions contained in the costs rules which provide for the summary assessment of all applications, including applications of this sort, which are down to last for a day or less in the interests of saving costs and delay in respect of detailed assessments”.

In its absence, the claimant submitted that he should direct a detailed assessment.

HHJ Pelling said: “I am prepared to direct that there should be such a detailed assessment because, in principle, the claimant should be entitled to recover their costs.

“However, it is entirely wrong that the defendants should be exposed to the costs of and occasioned by a detailed assessment process in circumstances where the claimant could and should have filed a summary assessment costs schedule.

“In those circumstances, what I propose to do is to direct that whilst there will be a detailed assessment, the claimant should not be entitled to recover the costs of and occasioned by the detailed assessment other than by reference to the conduct of the defendants in such assessment after the detailed assessment has been commenced by the claimant with the intention that the costs of issuing the detailed assessment should not be recoverable but any other costs in the detailed assessment should be dealt with by the costs judge in the usual way.”

Mr J England appeared on behalf of the claimant. The second and third defendants appeared in person. The first and fourth to seventh defendants did not attend and were not represented.