Court holds that an application under CPR 44.11 to reduce a party’s costs on the basis of misconduct is not a vehicle to give paying parties a “second bite of the cherry”

In Paul Andrews & Anor -v- Retro Computers Ltd & Ors [2019] EWHC B2 (Costs), Master Friston held that an application that the receiving party’s costs should be reduced or disallowed under CPR 44.11 on the basis of that party’s conduct was not to be used as a vehicle to contest the order for costs made by the trial judge.

This update is a summary of a complex and lengthy judgment. A full analysis will follow in due course.

CPR 44.11

CPR 44.11 states (so far as relevant) that:-

(1) The court may make an order under this rule where –

(a) a party or that party’s legal representative, in connection with a summary or detailed assessment, fails to comply with a rule, practice direction or court order; or

(b) it appears to the court that the conduct of a party or that party’s legal representative, before or during the proceedings or in the assessment proceedings, was unreasonable or improper.

(2) Where paragraph (1) applies, the court may –

(a) disallow all or part of the costs which are being assessed; or

(b) order the party at fault or that party’s legal representative to pay costs which that party or legal representative has caused any other party to incur.

The Case

The Defendants applied under CPR 44.11(2)(b) on the basis that the Claimants’ conduct had been “unreasonable or improper”. There was no suggestion that the Claimants’ legal representatives had acted improperly or that there had been a failure to comply with a rule or practice direction.

Summary of Judgment

The court held that:-

  1. An application under CPR 44.11 is not a vehicle to allow the paying party to have a “second bite of the cherry”, and that issues which were before the trial judge (or which the parties were reasonably capable of bringing to the trial judge’s attention) could not be considered on such an application;

2. The conduct complained of must have been relevant to the proceedings;

3. There is a high bar for establishing that the conduct was unreasonable; and

4. The sanctions the court can impose are limited.

Conclusion

It is important that solicitors and advocates ensure that issues of conduct are raised at trial and are incorporated into the order for costs.

The issues which the court can consider are wide-ranging but should generally have some relevance to the proceedings.

There is a high bar to establishing that conduce was unreasonable, that “unreasonableness” is to be interpreted narrowly, and is conduct which is so bad as to “permit no reasonable explanation” or which “the consensus of professional opinion would regard as improper”.

The sanction which the court can impose will generally be restricted to disallowing the costs which have been incurred as a result of the unreasonable conduct.

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How to Keep Your Costs Officer Happy!

Our specialist ‘Court of Protection Costs Team’ work for over 30% of the Deputies, and for that reason we have extensive knowledge in this area. Costs Officers tend to have a core approach which they apply to detailed assessments, together with areas which fall outside this core approach which are dealt with on a bill by bill basis. However, if the Costs Officer can deal with this core area with ease, then their job can be dealt with more easily.

An easier job = a happy Costs Officer = the optimum result!

Here are my top tips on how to keep the Costs Officer happy:

  • Always claim the appropriate hourly rates. If you do wish to claim a higher rate then an exceptional reason will be required to do so.
  • Try not to claim Grade A rates throughout the entirety of a Bill of Costs. If you are a sole practitioner or you are unable to delegate, it could be suggested that the more straightforward tasks be claimed at a lower rate. This ensures that the time and rate claimed are proportionate and reasonable to the task in hand.
  • Keep the ‘documents’ section of the bill as concise as possible to keep the Costs Officers attention.
  • Only claim for the tasks that are recoverable. A Costs Officer could look at the Bill less favourably if every task possible has been claimed for. Examples of non-recoverable items are – photocopying, …………
  • Clarify that certain parties within the Bill of Costs are not internal parties such as Tax Advisors or Accountants. If this is not clear, the time may be disallowed for a belief that it is inter-fee earner and therefore not recoverable, Leighanne Radcliffe (2004 ).
  • Try not to claim for two fee earners at an attendance, unless there is a valid reason for doing so. The Costs Officers will generally only allow one portion of the time claimed, Garylee Grimsley – (1998)

If these top tips are applied I am confident that that you will achieve your optimum result.

If you have any questions or queries in relation this blog please contact Danielle Schofield (Danielle.schofield@clarionsolicitors.com and 0113 3363213) or the Clarion Costs Team on 0113 2460622.