Skip to content
  • About
  • Costs Management
  • Court of Protection Costs
  • Litigation Costs
  • Events
  • Key contacts
  • Case studies
  • Complaints
Search
Close

Clarion Legal Costs

Tag: CPR 44.2(8)

What constitutes a reasonable sum to be paid on account of costs?

February 23, 2021February 23, 2021 Andrew McAulayLeave a comment

The Court of Appeal has considered how a ‘reasonable sum’ is arrived at in respect of payments on account of costs in the recent judgment in Mousavi-Khalkali v Abrishamchi [2020] EWCA Civ 493.

A payment on account of the successful Respondent’s costs was ordered pursuant 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 Respondent’s costs totalled £633,000 against the Appellant’s costs of £263,000. The trial judge had ordered a payment on account of £325,000 using the approach in Excalibur Ventures LLC and Dana Gas.

The judgment in Excalibur Ventures confirms that the test is not the ‘irreducible minimum’ but rather what is a ‘reasonable sum’. One suggested approach was to start with an estimation of the costs likely to be recovered and then to discount that figure to allow for a margin of error. This approach was endorsed in the Dana Gas judgment and was the approach used by the trial judge in Mousavi-Khalkali.

The judge estimated a maximum of £450,000 being recovered at assessment, allowing for the nature of the litigation (which included a worldwide freezing order) and the fact that an element of indemnity costs had been ordered. A discount was then applied (28%), taking into account the scale of the sums, to arrive at £325,000.

The Appellant argued that £200,000 would be a good recovery and that the judge had strayed ‘outside the bounds of reasonable disagreement’.

On appeal, it was found that the sum ordered by the trial judge (£325,000 against the total costs of £633,000), whilst possibly higher than another judge may have ordered, was well within the ambit of his discretion and the appeal was dismissed. The decision therefore confirms the approach in Excalibur Ventures and Dana Gas.

Helen Spalding is an Associate in the Costs and Litigation Funding Department at Clarion. You can contact her at helen.spalding@clarionsolicitors.com or on 0113 288 5639.

Blog categories

  • Costs Management
  • Court of Protection
  • Litigation Costs
  • Solicitor and Own Client Costs
  • Uncategorized

Contact Information

Elizabeth House
13-19 Queen Street
Leeds
LS1 2TW
T: 0113 246 0622
  • Terms and Conditions
  • Privacy Policies
  • Cookie Policy
  • ESG | Environmental, Social and Governance
  • Equality and Diversity

Follow Blog via Email

Enter your email address to follow this blog and receive notifications of new posts by email.

Legal and Regulatory

Costs and litigation funding are services provided by Clarion Solicitors Limited.  Clarion is the trading name of Clarion Solicitors Limited.  This is our dedicated micro-site where we share relevant updates, news and case law about costs and litigation funding. For more details on the other services offered by Clarion, please visit our main site www.clarionsolicitors.com.  By clicking on the link and scrolling to the foot of the page, you will find links to our legal and regulatory information.

Clarion Solicitors Limited is a company incorporated and registered in England and Wales with company number 7185479 whose registered office is at Elizabeth House, 13-19 Queen Street, Leeds LS1 2TW.  A list of our directors is open to inspection at the registered office.  Any reference to “partner” means any shareholder or director of Clarion Solicitors Limited or any employee or consultant with equivalent standing based on their experience and/or qualifications.

Clarion Solicitors Limited is a firm of solicitors operating in England and Wales. Clarion Solicitors Limited is authorised and regulated by the Solicitors Regulation Authority (SRA), with SRA number 533649. The professional rules that govern Clarion Solicitors Limited are the SRA Standards and Regulations available at https://www.sra.org.uk/solicitors/standards-regulations/

Clarion Solicitors Limited’s VAT number is 387983573.

Clarion Solicitors Limited does not accept service by electronic means.

Powered by WordPress.com.
Back to top
 

Loading Comments...