Changes to the Deputy Standards 2023

Ellie Howard-TaylorLeave a comment

There has been an update to the existing Property & Finance and Health & Welfare Deputy Standards (‘Standards’), which will come into effect from mid-February 2023.

The single set of refreshed standards will apply to everyone who has been appointed as Deputy, including lay Deputies. Guidance tailored for professionals, public authorities and lay Deputies will also be published at the same time.

This is not the introduction of a new set of standards. The guiding principles of the refreshed standards remain the same and continue to be aligned with the Mental Capacity Act (MCA). The main changes are to make the standards more focused.

What has been changed?

The number of standards has been reduced from more than 40 to 8 core areas, which reflect the duties and responsibilities of all Deputies. Much of the material included in the original standards has now been re-shaped and included within the guidance documents.

The Office of the Public Guardian (OPG) has contacted all Deputies to notify them of the changes.

The refreshed standards can be found at published at https://www.gov.uk/guidance/opg-deputy-standards.

The Government’s measures to clarify the uncertainties surrounding LFAs following the 2023 PACCAR ruling

angelanakoLeave a comment

The Minister of State for Justice, Sarah Sackman KC MP, announced that the government will take action to limit uncertainties surrounding third-party litigation funding agreements (LFAs) following the 2023 Supreme Court ruling in PACCAR. The government will also implement proportionate regulation of LFAs, in line with the Civil Justice Council’s (CJC) recommendations.

Further background information regarding the ruling in PACCAR can be found in Anna Lockyer’s blog post here.

The Government’s next steps

The Supreme Court Judgment in PACCAR created uncertainty around the validity and enforceability of LFAs. The government has now announced that legislation will be introduced to clarify that LFAs are not damages based agreements. They have said this will be implemented with “prospective effect” (the CJC recommendation was for prospective and retrospective effect). In doing so the government hopes this will reassure funders that LFAs can continue to be used to fund cases, the government recognising that LFAs can enable individuals to bring complex claims against better-resourced organisations and that the uncertainty post-PACCAR might be preventing claimants from pursuing claims.

In addition, proportionate regulation of LFAs will be introduced, to improve transparency and fairness for claimants. Legislation will be introduced when “parliamentary time allows”. Once these two changes have been implemented, the Civil Justice Council’s wider litigation funding recommendations will be considered, and further changes will be announced.

Conclusion

When it came into office the new government made clear it would wait for the CJC report before taking decisions on any legislation concerning litigation funding. While we must still wait to see the government’s proposed timetable and the text of draft legislation, the government has said its priority is to remove the uncertainty introduced by PACCAR and ensure the litigation funding sector works fairly and efficiently for all.

Angela Nako is a Paralegal in the Costs and Litigation Funding Department at Clarion Solicitors. You can contact the team at civilandcommercialcosts@clarionsolicitors.com

The expensive mistake of not engaging with Part 36 offers

Bethany CollingsLeave a comment

The recent High Court decision in Learning Curve (NE) Group Ltd v Lewis & Anor [2025] EWHC 2491 provides an important reminder of the consequences of making or failing to accept a settlement offer under CPR Part 36.

Underlying proceedings

The case concerned a Share Purchase Agreement dated 29 October 2021, under which the Claimant acquired shares from the Defendants. The Claimant brought a claim for breach of warranty under an indemnity contained in the Share Purchase Agreement.

On 7 February 2024, the Claimant made a Part 36 offer to settle for £5,211,625, with which the Defendants did not engage. This was unusually the exact same amount that was awarded within the judgment dated 4 August 2025.

Consequential Judgment

The central issues before the Court were whether the Part 36 offer was valid and clear, the application of Part 36 consequences under CPR 36.17(4), the appropriate interest rates on the judgment sum and costs, and the bases of assessment for the costs Orders.

The Defendants argued that the offer was unclear because it did not explicitly take into account their prior payment, while the Claimant contended that the offer was clear and should trigger Part 36 consequences.

HHJ Russen KC held that the Claimant’s Part 36 offer was valid and that the amount awarded under the judgment matched the offer. This meant that the full consequences of CPR 36.17(4) were triggered. The Court rejected the Defendants’ argument that the offer was unclear, noting that they could have sought clarification under CPR 36.9.

Interest was awarded at 2% above the base rate for the period until the expiry of the relevant period, and 8% above the base rate thereafter until the judgment date. The Court ordered costs on the standard basis for work done prior to the expiry of the relevant period and on the indemnity basis thereafter. The Judge ordered a payment on account of costs amounting to £1,257,382, representing 100% of the budgeted costs, and awarded an additional Part 36 amount of £75,000 (which is the maximum amount that can be awarded in accordance with CPR 36.17).

Practical implications

This case highlights the importance of making effective Part 36 offers. A carefully considered and timely offer that is not accepted can lead to substantial additional costs, interest and other consequences. Although the Part 36 offer in this case did not explicitly address the prior payment, the Court found it was sufficiently clear that the Part 36 offer was in respect of the entire claim, including the prior payment. Parties should therefore seek clarification promptly if they are unsure on the terms of a Part 36 offer.

Bethany Collings is an Associate in the Costs and Litigation Funding Team at Clarion Solicitors and can be contacted at bethany.collings@clarionsolicitors.com or on 07774 951949.

Understanding the consequences of serving a defective bill of costs

ujjainimistryLeave a comment

In Hyder -v-Aidat-Sarran [2024] EWHC 3686 (SCCO), Deputy Costs Judge Roy KC dealt with two applications: from the Claimant for relief from sanctions for late service of the bill of costs; and from the Defendants who applied under CPR 44.11 to strike out the Claimant’s claim for costs due to serious and repeated failures to comply with rules, practice directions and Court orders and/or unreasonable or improper conduct during the detailed assessment proceedings.

Background Information

The applications were made against a background of procedural failures by the Claimant. A defective bill of costs, which had been prepared in the wrong format, had been served late. The Defendants served Points of Dispute in response to the defective bill, which highlighted numerous other failings, including a failure to certify and claims for costs to which the Claimant was not entitled. In the absence of Replies to Points of Dispute, the Defendants applied for an Unless Order.

As there was no serious dispute that the Claimant’s bill was defective, and on the strength of assurances given by the Claimant that an amended bill of costs had been prepared which would be served at the same time as the request for detailed assessment was filed, an Unless Order was made by consent. The Unless Order required the Claimant to file a request for detailed assessment hearing by 13 August 2024. In default of which the Claimant’s costs would be disallowed, and the Claimant would be required to pay the Defendants’ costs of the detailed assessment proceedings.

In the event, the Claimant filed the bill of costs together with a request for detailed assessment 1 day late by email, notwithstanding that the use of CE-File is compulsory in the Senior Court Costs Office. Although by this time the bill was in the correct format, none of the previously identified defects had been rectified and the filed bill introduced further defects in addition to those previously identified.

The Claimant was therefore required to apply for relief from sanctions. The Defendants opposed the application on grounds that the bill was so severely defective the Claimant could not properly be said to have belatedly complied with the Unless Order and they also applied for an order to strike out the claim for costs under CPR Rule 44.11, in any event.

The Judge dealt with each application in turn.

  1. The Claimant’s application for a relief from sanctions

The Judge referred to the Denton Principles, which is a three stage test used to guide the Court when deciding applications for a relief from sanctions under CPR 3.9.

Stage 1 was considered in relation to whether the service of a defective bill a day late was non-compliance with the order and whether that was a serious or significant breach.

The Judge stated that he was ‘ultimately against’ the Defendants submissions that the bill was so defective it should not be described as complying with the order because the bill was served within the meaning of the order in that the Unless Order did not specify a requirement to serve a fully compliant bill. Relief from sanctions was therefore granted.

  1. The Defendants’ application under CPR 44.11 to strike out the Claimant’s claim for costs

CPR 44.11(1) sets out the Court’s powers to address misconduct, which may apply where:

(a) a party or their legal representative fails to comply with a rule; or

(b) a party’s or legal representative’s conduct is unreasonable or improper.

If either limb of CPR Rule 44.11 are met, then the Court may apply one of the sanctions in CPR 44.11(2), which are:

  • disallow all or part of the costs which are being assessed; or
  • or order the party at fault or that party’s legal representative to pay costs which they have caused another party to incur.

The Judge found that both limbs of CPR 44.11(a) and (b) were made out. He found that in addition to the defects identified in the original bill, the Claimant had served an electronic bill which failed to comply with most of the requirements of electronic bills in Practice Direction 47.

The Judge agreed there were multiple significant failures within the bill, with some more serious than others. He also found it ”beyond belief” that the defects were not rectified in the electronic bill, despite being identified in the Points of Dispute. The Claimant also failed to serve evidence to explain or address the failings and failed to apologise for (or even acknowledge any of the failings) before the hearing. This was described as “serious and troubling lack of insight and contrition on behalf of the Claimant’s solicitors.”

It was also held that it was not appropriate for the Claimant’s solicitor to blame their costs draftsman for the errors on the basis that the costs draftsman is the solicitor’s agent, and the solicitor is vicariously liable for the draftsman’s failings (Gempride v Bamrah [2018] EWCA Civ 1367). The solicitor also had direct supervisory responsibilities which they did not fulfil in relation to reviewing and checking the bills of costs.

The Judge therefore found that “there have been multiple compound breaches. They have been serious. They have been persistent. They are unexplained, and they are inexcusable for the most part.”

It was then left to the Judge to decide upon the severity of the sanction to impose. Although a complete strike out of the claim for costs was possible, the Judge decided against that on grounds that the Court of Appeal had found that sanction to be draconian, even in cases of serious misconduct. Instead, the Judge recognised that a severe sanction was warranted and Ordered that the Claimant’s assessed costs would be subject to a 75% reduction.

Ujjaini Mistry is a Paralegal in the Civil and Commercial Costs Team at Clarion Solicitors. You can contact the team at civilandcommercialcosts@clarionsolicitors.com

Can an arbitrator make a costs award when they have determined they lack jurisdiction to deal with an arbitration?

Joanne ChaseLeave a comment

The recent decision of Ravfox Ltd v Bexmoor Ltd [2025] EWHC 1313 (Ch) explored whether an arbitrator had jurisdiction to make a costs award when it had been found that they lacked jurisdiction to deal with the matter.

Background

By way of background, the parties were in dispute as to the amount of service charge the defendant (Bexmoor Ltd) was required to pay the claimant (Ravfox Ltd) in respect of individual units which the defendant sublet from the claimant on an industrial estate. The defendant referred the matter to arbitration and alleged that the claimant (the respondent in the arbitration) failed to comply with its obligations under the sublease.

Within the arbitration, the respondent, Ravfox Ltd, filed a statement in reply to Bexmoor Ltd’s statement of claim, challenging the arbitrator’s jurisdiction on the basis there was no binding sublease between the parties. Ravfox Ltd sought their full costs and expenses of the arbitration from the applicant.

Arbitral Decision

The arbitrator found that there was no binding contract containing an arbitration clause and that he did not, therefore, have jurisdiction to hear the dispute. Further, he found that, in light of his lack of jurisdiction in the dispute, he lacked jurisdiction to make any determination as to costs. He added, however, that having read the submissions filed by the parties, he would have found in favour of the claimant (Ravfox Ltd), and he would have ordered that no costs were payable. As a result of this finding, he recommended that the matter be put before the Court to determine the costs of the jurisdictional challenge.

Court Decision

His Honour Judge Keyser KC reviewed the relevant provisions of the Arbitration Act 1996 and determined that the arbitrator was wrong to determine he had no jurisdiction to deal with costs. He went on to explain that:

“It would mean that a respondent making a jurisdictional challenge would be at risk of an adverse costs order if the jurisdictional challenge failed and would necessarily bear its own costs if the jurisdictional challenge succeeded, whereas the referring party would be able to recover the costs of successfully defending a jurisdictional challenge but would be at no risk of an adverse costs order if the jurisdictional challenge succeeded.”

Clarification to section 61 of the Arbitration Act 1996

The Law Commission’s Consultation Paper 257, Review of the Arbitration Act 1996, considered this point further and recommendations were made to insert a new subsection (1A) to section 61 of the 1996 Act. Effective from 1 August 2025, section 61 of the Arbitration Act 1996 now reads:

“61. Award of costs

(1) the tribunal may make an award allocating the costs of the arbitration as between the parties, subject to any agreement of the parties.

(1A) it is irrelevant for the purposes of subsection (1) whether the tribunal has ruled, or a court has held, that the tribunal has no substantive jurisdiction or has exceeded its substantive jurisdiction.”

The Law Commission considered that the inclusion of this new subsection simply “put the matter beyond doubt” rather than changing the law, to which HHJ Keyser KC agreed.

This decision makes the position clear; that where an arbitrator accepts a challenge that they do not have jurisdiction to hear a dispute, they are still able to deal with the costs arising out of such a challenge.

 

Joanne Chase is a Legal Director in Clarion’s Costs and Litigation Funding Team and can be contacted on 07826 166300 or Joanne.Chase@clarionsolicitors.com

The SCCO Guide 2025: Key Points for COP Practitioners

Ella WilkinsonLeave a comment

The Senior Courts Costs Office (SCCO) has released its 2025 Guide, offering updated guidance on Court of Protection costs, deputyship billing, and detailed assessment procedures. While many of the core principles remain unchanged since 2023, the new edition clarifies several practical points that Court of Protection practitioners and professional deputies should note for compliance and smoother assessments.

As in previous years, Section 27 remains dedicated to Court of Protection (COP) cases.

You can refer back to my previous blog on the content of the 2023 Guide here: https://clarionlegalcosts.com/2023/07/06/the-scco-guide-2023-key-points-for-cop-practitioners/

Fixed Costs Under Practice Direction 19B

The 2025 version of the guide expands on Practice Direction 19B, confirming that the current version and relevant fixed costs within apply where the period covered by the fixed costs/remuneration ends on or after 1 April 2024. The latest Guide also lists the pre-April 2024 and post-April 2024 fixed costs in full for clarity.

Deputies may continue to claim rates under the previous version of Practice Direction 19B where the period in question ended before 1 April 2024. For example, if a deputy still has an unbilled management year from 2022/2023 with minimal WIP within the fixed cost parameters, they can still apply the fixed fee applicable under the earlier version of the Practice Direction.

Additional guidance is then provided for deputyships where P’s assets are below £20,300 (and where P will be considered to be in hardship). If a management year is shorter than 12 months, such as where a deputy is discharged, the annual management fee should be proportionately reduced to reflect the shorter period.

Commencing a Detailed Assessment

For bills with profit costs of up to £100,000, cases will be dealt with by a Costs Officer. Supporting documents must be lodged with the SCCO either:

  • by submitting a paper file to the court, or
  • by uploading an electronic bundle via the Document Upload Centre (DUC).

For format guidance and DUC access, deputies can contact scco@justice.go.uk.

For bills where profit costs exceed £100,000 or the case is deemed complex, a Costs Judge will deal with the assessment. Files need only be lodged upon request.

This section of the SCCO Guide 2025 remains largely consistent with the 2023 version but reinforces best practice for electronic filing.

Hourly Rates and Retainers

The SCCO Guide 2025 acknowledges the recent increases to the guideline hourly rates introduced in 2021, 2024, and 2025. It emphasises the importance of keeping client retainers up to date, ensuring that the claimed rates comply with the indemnity principle to facilitate successful recovery on assessment. For those working on Court of Protection matters, this serves as a timely reminder to review all retainers to ensure these are up to date with the latest Guideline Hourly Rates.

Authority to Assess Costs

Deputies must ensure that their order gives explicit authority for all categories of work claimed, such as application and general management work.

Key takeaways from this section include:

  • General management costs should typically be claimed annually, unless there are special circumstances which should be highlighted within any bill submitted.
  • The SCCO lacks jurisdiction to assess costs once a deputyship order has expired or a deputy has been discharged.
  • Reference is also made to Re ACC [2020] EWCOP 9, which highlights work outside the scope of general management requiring specific court authority. Where such work is claimed, ACC orders providing the relevant authority should accompany the bill or follow shortly thereafter.

The Detailed Assessment Process

Where a deputy remains dissatisfied after an informal review, or where the Costs Officer/Costs Judge considers that the extent of the review would render an oral hearing more suitable, the SCCO will list the case for an oral hearing before a Costs Judge.

Costs Following P’s Death

The SCCO Guide 2025 provides important clarification on how to manage costs when P passes away during or before assessment.

If P dies while an SCCO assessment is pending, the professional deputy should:

  1. Notify the SCCO in writing.
  2. Seek to agree costs with the personal representatives, if possible.
  3. Decide whether to withdraw the bill (if costs have been agreed) or continue with the assessment.

It is important to note that whilst costs incurred during P’s lifetime remain assessable under the deputyship order, post-death costs fall outside the Court of Protection’s jurisdiction, as the COP’s authority ceases upon P’s death.

It remains that deputies do not need to obtain a new order before submitting lifetime costs for SCCO assessment (i.e any costs incurred before P’s death).

Payments on Account

Section 6 of Practice Direction 19B is emphasised once more. Professional deputies who elect for detailed assessment may take payments on account during the management year, provided these are both proportionate and reasonable and do not exceed 75% of the work in progress or the estimate submitted to the OPG (whichever is lower).

The SCCO Guide 2025 emphasises that copies of interim bills should not be sent to the SCCO. Once the annual management year ends, the deputy must prepare and submit their annual bill of costs for detailed assessment (unless taking fixed costs). Any final sum due to the deputy after assessment will then be adjusted to reflect any payments on account taken during the management year.

If there has been any overpayment, any excess must be refunded to P within 28 days of the final costs certificate being obtained.

Final Thoughts: The SCCO Guide 2025 in Practice

Whilst the new version of the SCCO Guide doesn’t introduce any ground breaking changes, it provides valuable clarification and more formal guidance in alignment with what is already current practice surrounding costs for Court of Protection matters.

For professional deputies and costs practitioners, it remains an essential reference point when preparing and lodging bills for assessment at the SCCO, reinforcing the need to adhere to the provisions of Practice Direction 19B and the Court of Protection Rules 2017.

The updated version of this guide incorporated reinforces the importance of accurate billing, timely submissions, and clear authority for costs, helping practitioners navigate the assessment process with confidence and to reduce potential issues and delays later down the line.

If you would like to review the contents of the SCCO Guide 2025 in full, this can be found at The Senior Courts Costs Office Guide 2025 – Courts and Tribunals Judiciary

If you have any questions, please get in touch with Ella Wilkinson (Ella.Wilkinson@clarionsolicitors.com) who is an Associate in the Costs & Litigation Funding Team at Clarion Solicitors, specialising in Court of Protection costs.

 

Actor ordered to pay Guardian News indemnity costs and a £3 million payment on account of costs

angelanakoLeave a comment

Mrs Justice Steyn in Clarke v Guardian News & Media Ltd [2025] EWHC 2575 (KB) examined the issue of costs following the dismissal of actor, Noel Clarke’s, defamation and data protection claims against the Defendant newspaper. To determine the appropriate costs, the judgment addressed the Claimant’s conduct, the costs approved in the costs budget and the various “costs reserved” orders made during the proceedings. Whether the Claimant should make a payment on account of the costs pending detailed assessment and the amount of the payment is also considered in detail.

Background

The Defendant in this case had succeeded on the defences to defamation and the issue of serious harm in respect of 8 articles published about the Claimant actor. The Court determined that the Defendant had been wholly successful and therefore entitled to an order that the Claimant pays costs subject to detailed assessment.

Indemnity Basis Costs

With regards to the basis of assessment, the Judge referred to the legal principles in relation to exercising the court’s discretion to award costs on the indemnity basis summarised within the White Book at 44.3.8 to 44.3.10. The Judge cited the importance of the Court having regard to all the circumstances of the case and the conduct of the Claimant being a key element of this.

The Judge found that the Claimant’s pleaded case and the evidence at trial contained many statements that the Judge found to be untrue and dishonest. Mrs Justice Steyn referred to Esure Services Limited v Quarcoo [2009] EWCA Civ 595, which concluded that if a court finds a claim to have been brought or maintained dishonestly then “it will be normal for a court to seek to mark its disapproval” by making an order for indemnity costs.

Further, the Judge made reference to the Claimant making “wholly unfounded allegations of dishonesty against three professional journalists” and aired those publicly.

It was also highlighted that an order for indemnity costs does not require the Defendant to show that the Claimant’s unreasonable conduct increased its costs. Consequently, the Judge ordered the Claimant to pay the Defendant’s costs of the claim to be subject to detailed assessment on the indemnity basis, if not agreed.

Payment on Account of Costs

When addressing the issue regarding a payment on account of costs, the Judge referred to CPR 44.2(8) which states: “Where the court orders a party to pay costs subject to detailed assessment, it will order that party to pay a reasonable sum on account of costs unless there is good reason not to do so.”

The Judge had regard for the way the claim had been pursued by the Claimant and the fact that costs would be assessed on an indemnity basis. The Judge also took into account the Defendant’s Precedent H of July 2024 where the total of the Defendant’s budgeted costs and incurred costs were £3,184,519.98, not including the estimated costs of disclosure, which were left to be agreed or subject to detailed assessment. This figure also did not include costs in respect of the Trial Preparation and Trial phases.

The Judge concluded that it was reasonable for a payment in the sum of £3 million to be sought by the Defendant.

Additional Costs Points

“Costs reserved” orders were made during the proceedings, regarding the Defendant’s application for an interim non-disclosure order and an Amendment and Joinder Application. The Judge concluded that the Defendant was entitled to these costs.

The Claimant asked the Judge to stay the costs order pending a potential application for permission to appeal. This was rejected as the Claimant already had more than the usual time to consider any grounds to seek leave to appeal and the Judge was not prepared to provide an extension of time to seek permission to appeal.

Conclusion

At paragraph 39 of the judgment, Mrs Justice Steyn articulates the reasoning behind her decision as she states: “Bearing in mind that the sum claimed by the Defendant on detailed assessment will be in excess of £6 million and having regard to the nature of the claim and the way in which it has been pursued by the Claimant and his lawyers; bearing in mind also the Defendant’s rates as they appear on the Precedent H forms and what appears, on the face of it at least, to be a reasonable use of more junior solicitors where appropriate; and also bearing in mind that I have ordered that costs will be assessed on an indemnity basis; it seems to me that the sum of £3 million sought by the Defendant is appropriate and no more than ought reasonably to be ordered in this case. It is a “reasonable sum” to require the Claimant to pay on account. It is substantially lower than the Defendant’s likely level of recovery on detailed assessment and so, in my judgment, it does allow for a suitably wide margin of error. Accordingly, I shall order the Claimant to make a payment on account in the sum of £3 million within 28 days.”

Angela Nako is a Paralegal in the Costs and Litigation Funding Department at Clarion Solicitors. You can contact the team at civilandcommercialcosts@clarionsolicitors.com

Failure to act reasonably limits private prosecutor’s costs out of central funds

Ellena HunterLeave a comment

Background

In R v BDI & Ors [2025] EWCA Crim 1289, the private prosecutors applied for an order pursuant to section 17 of the Prosecution of Offenders Act 1985 that their costs of resisting the application for abuse of jurisdiction, and of the appeal of the same, be paid out of central funds. The Lord Chancellor was permitted to intervene in the application.

The private prosecutors alleged that they had suffered financial loss as a result of dishonest activity by the respondents which crossed national borders. They made their costs application in writing to the Registrar of Criminal Appeals in which they sought costs of £187,970.

Lord Chancellor’s Position

The Lord Chancellor submitted that the court should reduce the amount of the private prosecutor’s costs on the basis that there were serious deficiencies in the application for costs, and that the costs should be limited to those which would have been charged to the state if the CPS had conducted the prosecution. Alternatively, it was submitted that the costs of the solicitors’ work should be based on the guideline hourly rates and that counsel’s fees should only be allowed at a competitive market rate. Furthermore, the Lord Chancellor submitted that the private prosecutors failed to state in their application that they had taken no steps to involve the police and the CPS before commencing prosecution, and they failed to set out what steps they had taken to test the market before instructing their solicitors and counsel. Therefore, it was submitted that, in light of the failure to involve the police and ask the CPS to prosecute before issuing the summonses, the costs should be capped at CPS rates.

In summary, the Lord Chancellor’s core submission was that “the public purse should not have to pay increased costs when the private prosecutors took no steps to involve the state prosecuting authorities.”

Private Prosecutor’s Position

The private prosecutors denied that the application for costs was defective and submitted that there was no basis for the court to limit the costs to CPS rates. The private prosecutors referred to the correspondence with the CPS in which the CPS stated that the way in which the case had been handled to date demonstrated that the international reach of the solicitors could have benefits to a prosecution which a public prosecutor would find hard to match. Furthermore, the CPS had been offered the opportunity to take over the prosecution and declined to do so.

Judge’s Determination

Having considered the submissions of both parties, the Judge confirmed that its view was that:

“Any private prosecutor who fails to take appropriate steps or fails sufficiently to inform the court about them in his application for an order… puts himself at risk that the application will be refused, or that any award will be reduced… to the level of costs which would have been incurred if the state authorities had prosecuted the case.”

The Judge considered that it would always be important for the court to know whether the state prosecuting authorities were given a reasonable opportunity to make an informed decision as to whether they should undertake the prosecution. On this point, the Judge held that there were two points to consider. The first being that CPS rates may properly be considered if a private prosecutor acted without regard to whether the state was willing and able to prosecute (citing Fuseon Ltd v Senior Courts Costs Office [2019] EWHC 126 (Admin), [2020] Costs LR 251). The second point being that even if it was reasonable for the private prosecutor to undertake the prosecution, it may still be relevant to consider what expenses would have been incurred if the case had been conducted by the state prosecuting authority.

In analysing the facts and circumstances of the present case, the Judge made note that the private prosecutors did not inform the police or invite the CPS to consider the evidence relied upon until directed to do so by the District Judge who issued the summonses. By this point, significant work had been undertaken. Furthermore, within the letter to the CPS the private prosecutors expressed that they did not wish for the CPS to take over conduct of the proceedings. Whilst the private prosecutors were entitled to take the approach that they did, they thereby put themselves at risk in relation to recovering their costs from the public purse.

It was accepted by the Judge that the case was a complex one and had been well conducted by the private prosecutors. However, the Judge determined that the fundamental difficulty the private prosecutors faced was that they had failed to show that the police and the CPS, if given an appropriate opportunity at an appropriate stage, could not or would not have undertaken the prosecution. Therefore, they failed to show that they had acted reasonably in incurring expenses in excess of those which would have been incurred by the CPS. On that basis, the Judge was satisfied that there were circumstances which made it inappropriate for the private prosecutors to recover the full amount of costs which would otherwise have been awarded.

The Judge, therefore, ordered that the private prosecutors be paid out of central funds but be limited to the expenses which would have been incurred if the prosecution had been undertaken by the CPS.

Ellena Hunter is an Associate in Clarion’s Costs and Litigation Funding Team and can be contacted on 07979 199145 or Ellena.hunter@clarionsolicitors.com

EG & Anor v P [2024] EWCOP 80 (T3)

hawamayetLeave a comment

In a recent Judgment handed down by Sir Andrew McFarlane, President of the Family Division, the Court of Protection considered an urgent application brought by Deputies acting for P, who sought a payment of £17,000 from his funds to repay a drug debt to an organised crime group.

Case Summary

The Protected Party (P), now in his 20s, suffered a severe brain injury as a toddler in a road traffic accident and was awarded a substantial compensation fund. Despite cognitive impairments, P lives independently and is not subject to any welfare Orders. He has been deemed to have capacity in some matters, including entering a cohabitation agreement (assessed in 2020). However, his property and affairs remain under Deputyship.

Over a year ago, properties associated with P were raided by police. A significant quantity of Class A and B drugs was seized and P was arrested. His Deputies were aware of the arrest but believed the matter was limited to potential criminal proceedings. The situation escalated when P informed his Deputies that he owed £17,000 to a drug gang. He had reportedly agreed to share in the profits of the drugs seized. Fearing for his safety, P requested a payment from his fund to settle the debt.

The Deputies found themselves in a near-impossible position:

  • If P had capacity, they would be obliged to comply with his request, provided the payment fell within his legal entitlements.
  • If P lacked capacity, they could refuse the request, but the matter would then fall to the Court to consider whether it was in his best interests.
  • Either way, making such a payment risked criminal and professional consequences.

The Deputies obtained Counsel’s advice, which confirmed that making the payment would likely breach the Proceeds of Crime Act 2002, particularly under section 328 (entering into or becoming concerned in arrangements facilitating acquisition, retention or control of criminal property). Even if done with the best of intentions, such a payment would be seen as enabling criminal conduct and could expose the Deputies to liability. The advice obtained from Gregory Treverton-Jones KC confirmed that the Deputies would be in breach of the Solicitors Regulation Authority’s Principles and Code of Conduct if they made the payment.

The Court commissioned an updated, decision-specific capacity assessment which was carried out by Dr Geoff Hill, a consultant clinical neuropsychologist. The key findings included:

  • P understood the nature of the decision but he could not weigh the long-term risks or recall and apply key information (e.g. risk of prosecution, long-term financial harm)
  • His decision-making was driven by immediate emotional relief (reducing stress), not reasoned evaluation.

Dr Hill concluded that P lacked capacity to make this particular decision despite functioning well in other areas of life.

 Ruling

Sir Andrew McFarlane concluded that:

  1. P lacks the mental capacity to decide whether to pay the £17,000 drug debt.
  2. The Court cannot authorise a criminal act, even if it may reduce stress or mitigate a personal risk to P.
  3. The Deputies acted appropriately in seeking Court guidance and the Court expressly refused to dismiss the application, instead issuing a formal refusal to sanction the payment.

Importantly, the Court refused to make a best interests decision because of the binding authority in Secretary of State for Justice v A Local Authority & Ors [2021] EWCA Civ 1527, confirming that the Court of Protection cannot authorise illegal conduct under any circumstances.

Summary

The Court refused to sanction the payment requested for the payment to be made to the drug gang, concluding that doing so would amount to facilitating criminal conduct. This Judgment offers important clarity on the limits of Deputies’ powers and reinforces the fundamental legal principle that the Courts cannot condone or enable criminality, even where the individual involved believes it is in their best interests.

You can find out more about our services here or you can contact the Costs and Litigation Funding team at costs.support@clarionsolicitors.com.

Do you remember…costs budget updates in September…?

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Chancery Guide Update: Preliminary Issue or Split Trial when PD51ZG1

The fifth update to the Chancery Guide saw a new section inserted in relation to the costs budgeting light pilot scheme on matters proceeding in the Business and Property Courts of England and Wales, Manchester or Leeds or Business and Property Court work in the County Court at Central London, Manchester or Leeds (PD51ZG1), where one or both parties consider that a preliminary issue or split trial may be appropriate. The insert confirms that the following paragraphs are applicable:

“6.10 Costs and time can sometimes be saved by identifying decisive issues, or potentially decisive issues, and ordering that they are tried first. A trial of a preliminary issue may also be appropriate where its determination, although not itself decisive of the whole case, may enable the parties to settle the remainder of the dispute or otherwise shorten the proceedings. An example would be a relatively short question of law which can be tried without significant delay (or much in the way of disclosure or witness evidence) but which would be determinative of one or more of the key issues in dispute.”

“6.11 Parties should actively consider at the earliest opportunity, and certainly in advance of the first CMC / CCMC, whether there are any issues which are suitable for determination as a preliminary issue, or which should be tried separately such as a split between liability and quantum. If possible, parties should indicate when filing DQs whether a preliminary issue or split trial is under consideration and provide a summary of the proposed approach in Section I of the DQ. Parties should give careful consideration to the approach to costs budgeting and disclosure where a preliminary issue or split trial is proposed or agreed.”

The full updated guide can be found here: The Business and Property Courts of England & Wales Chancery Guide 2022

Costs Budget Light Pilot Schemes

Part 7 multi-track matters issued on or after 6 April 2025, captured by the Costs Budgeting Light pilot schemes, may soon be listed for their first case management conference, so as a reminder, the relevant practice directions listed below are to be mandatorily followed:

PRACTICE DIRECTION 51ZG1 – PILOT SCHEME FOR COST BUDGETING IN CERTAIN BUSINESS AND PROPERTY COURTS AND CERTAIN BUSINESS AND PROPERTY WORK IN THE COUNTY COURT – Justice UK

PRACTICE DIRECTION 51ZG2 – PILOT SCHEME FOR COSTS BUDGETING IN CERTAIN CLAIMS WITH A VALUE OF LESS THAN £1 MILLION – Justice UK

PRACTICE DIRECTION 51ZG3 – PILOT SCHEME FOR CERTAIN HIGH COURT QUALIFIED ONE-WAY COSTS SHIFTING (QOCS) CASES – Justice UK

Please feel free to get in touch with any queries relating to the schemes or for guidance on how to approach costs budgeting when these pilots apply.

“Over-lawyering” a key criticism in costs budgeting exercise

Case law relating to budgeting has piqued the interest of lawyers, in the recent round of budgeting the Pan Nox Emissions Litigation.

At the second costs management hearing in this group litigation (Tranche 3), the second period of general costs were budgeted separately. For Tranche 3, the Claimants’ budgets were reduced from £55.7m to £21m and the Defendants’ budgets from £75.8m to £48m. In respect of second general costs, the Claimants’ budgets were reduced from £19.8m to £1.4m and the Defendants’ budgets from £3.6m to £1.3m.

Mrs Justice Cockerill DBE and Senior Costs Judge Rowley opined that in respect of the Claimants’ budgets –

“the largest reductions stem from the layers of representation leading to, for example, claims for individual, non-lead firms to audit or replicate work already being done by the Lead firms.”

The full judgment can be read here:

Various Claimants v Mercedes-Benz Group AG & Ors (Re Pan NOx Emissions Litigation) [2025] EWHC 2307 (KB) (10 September 2025)

Anna Lockyer is a Senior Associate in the Costs and Litigation Funding Department at Clarion Solicitors and can be contacted on 07826 822 821 or at anna.lockyer@clarionsolicitors.com.