Entries by Toby Moreton

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Costs In The Case Is The Default Order Following A Failed Judicial ENE

In 3173 Bidco Ltd v Roberts (No.2) [2026] EWHC 2312 (Comm), HHJ Pearce held that costs in the case is the working default for a failed judicial ENE, identifying six reasons for caution before making adverse costs orders in such circumstances. The ENE, ordered by HHJ Halliwell and conducted before witness statements had been exchanged, collapsed when the defendants advanced a previously unpleaded argument at the hearing itself. The claimants sought indemnity costs, the defendants contended for costs in the case. HHJ Pearce refused to investigate causation as a disproportionate satellite exercise the court was not well placed to determine, and noted that because ENE was court ordered, the claimants could not argue that different conduct by the defendants would have saved costs, since failing to attend a judicially ordered ENE would itself have risked an adverse costs order. At paragraph 26, HHJ Pearce noted that penalising underpreparation at late ENE perversely incentivises early ENE, at paragraph 29 he identified direct access and unrepresented litigants as weighing against costs risk, and at paragraph 27 he treated the submission that ENE was doomed as an implicit criticism of the judge who ordered it. Consistency with pre issue ENE practice reinforced the default. The defendants’ cross application for costs of the submissions was dismissed. HHJ Pearce ordered costs in the case and preserved adverse orders only for parties attending with no intention to engage.

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Wasted Costs Applications | The Practical Necessity Of A Costs Schedule

In Pool v Pool [2026] EWFC 226 (B), Deputy District Judge Hales considered a wasted costs application brought by the applicant wife against Ash Solicitors, arising from financial remedies proceedings in which the firm had filed a position statement asserting, without any evidential basis, that the respondent husband lacked capacity to participate, had gone on the record without instructions, failed to attend the First Appointment, and forwarded the remote hearing link to a third party without the court’s permission. At the outset of the adjourned hearing on 3 August 2026, counsel for the wife confirmed the application was pursued, but conceded on inquiry that no Form N260 had been prepared or served, and the application was subsequently withdrawn. The procedural point of interest is that a costs schedule is not a condition precedent to bringing a wasted costs application or reaching the show cause stage: neither CPR 46.8, PD 46 nor FPR 28.2 requires one. That is not the end of it, because PD 44 para 9.5, applied to family proceedings through FPR 28.2, does require a statement of costs following Form N260 as closely as possible where summary assessment is in prospect, with the para 9.6 sanction behind it. The judge made no ruling on the point and none was argued, but applicants should file a schedule in any event. The court then used the directed explanatory statement, disclosed hospital correspondence and oral concessions from the supervising solicitor to record that there had never been instructions and no evidential basis for the capacity assertion. 

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Agreed Budget Variation Refused | Mutual Consent Intensifies, Not Reduces, Retrospective Scrutiny

In M L Technology Limited and Naurex Limited v B.E.A.T. SAM Limited and others [2026] EWHC 2142 (Ch), Mr Daniel Alexander KC, sitting as a Deputy Judge of the Chancery Division, refused to approve a retrospective increase of £259,069.67 to the claimants’ disclosure costs budget, notwithstanding that the defendants had agreed to it. At the CCMC, the claimants’ disclosure budget was approved at £97,768. Both parties subsequently applied for substantial increases, reached mutual agreement on those increases, and submitted an agreed draft order at the PTR. The judge declined to approve the increases at that stage and deferred both applications to after trial, so that the value of the additional disclosure could be assessed retrospectively. At the consequentials hearing, the claimants pressed for approval of the disclosure increase alone. The court refused, holding that costs budgeting protects third parties and the court, not merely the parties inter se, and that mutual agreement between the parties was a reason for more intense scrutiny, not less, because the adversarial process could not be relied upon to test the justification. The court found that no evidence or argument had been advanced to explain specifically what the additional disclosure had contributed to resolving the issues, judged with hindsight after trial. The burden on a party seeking retrospective budget revision was described as heavy, and it had not been discharged. The decision underscores that costs budgeting is intended to act as a constraint on future costs, not normally a vehicle for sanctioning costs already incurred, and that the court must be satisfied budgets are appropriate even where parties agree to increases.

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Retainer Termination Without Good Reason | Unenforceability And The Indemnity Principle

In HD and others v North Devon Healthcare Trust [2026] EWHC 2009 (SCCO), Costs Judge Joseph struck out six linked detailed assessment proceedings and ordered the claimants’ former solicitor to pay the defendants’ costs on the indemnity basis and to repay £92,000 in payments on account. The judge applied the two-stage test from Asturion Fondation v Alibrahim [2020] EWCA Civ 32, finding that over three years of complete inactivity following preliminary issue hearings, combined with the SRA’s intervention into the solicitor’s practice, his subsequent striking off, and the absence of any witness evidence explaining the delay, established deliberate dormancy amounting to abuse of process. The judge rejected the defendants’ alternative proposal of an unless order on the basis that it would serve no useful purpose given the claimants’ non-attendance at the hearing. The retainers were declared unenforceable because the solicitor had terminated them without good reason by abandoning the proceedings, breaching his obligation under the entire contract to complete the detailed assessment process. The judge inferred from HD’s disclosed CFA that the other five retainers were in materially similar terms, shifting the burden to the solicitor to prove otherwise, which he failed to discharge. Indemnity costs orders were made against the solicitor under CPR 44.11 based on his failure to lodge required documents causing an abortive hearing and his unreasonable conduct throughout, including the presentation of bills containing reductions from 63 hours claimed to 15 allowed on individual items.

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A Costs Sanction Can Be Both Remedial And Punitive Where Proportionate | Carl v Limbani In The Court of Appeal

In Carl v Limbani [2026] EWCA Civ 856, the Court of Appeal addressed whether a successful defendant who had given dishonest evidence and made false statements to police should recover his costs. Mr Limbani successfully defended conspiracy and conversion claims arising from alleged misappropriation of historic sports cars. At first instance, Simon Gleeson, sitting as a Deputy Judge of the High Court, indicated provisionally that there should be no order as to costs, but at the consequentials hearing refused to hear further submissions from Mr Limbani’s counsel, having mistakenly treated his provisional indication as a final determination. The Court of Appeal held this constituted a serious procedural irregularity under CPR 52.21(3)(b), set aside the costs order, and exercised the discretion afresh. Applying CPR 44.2 and the principles in Widlake v BAA Ltd [2009] EWCA Civ 1256, Bank of Tokyo-Mitsubishi UFJ Ltd v Baskan Gida [2009] EWHC 1696 (Ch), and Ward v Donnellan [2026] EWCA Civ 729, the court held that a costs sanction was justified both as a remedial measure and as a proportionate penalty. Mr Limbani had brought the proceedings on himself by making a false statement to police at Mr Edwards’ instigation, had given dishonest evidence throughout, and had facilitated the attempted disposal of Mr Carl’s cars. The court confirmed no order as to costs and dismissed the appeal.

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Non-Compliant Points Of Dispute Risk Strike Out Or Costs Sanctions | Court Of Appeal Warning In Ward v Rai

In Ward v Rai [2026] EWCA Civ 816 the Court of Appeal restored Deputy Costs Judge Friston’s decision not to strike out a non-compliant point of dispute and to permit reliance on an annotated documents schedule served two working days before the detailed assessment hearing. Point 23 of the paying party’s points of dispute challenged 134.1 hours of document time at £38,819.50 plus VAT but raised only general criticisms, cross-referencing a schedule that had not been served. The Costs Judge declined to strike out Point 23 under CPR rule 3.4(2), permitted reliance on the late schedule under paragraph 13.10 of PD 47 and adjourned to a third day, subject to costs sanctions. Mrs Justice Hill set that decision aside, but the Court of Appeal held that it fell within the generous ambit of the Costs Judge’s discretion: both parties were at fault and the schedule was no ambush. The court nonetheless cautioned that paying parties should be under no illusion that paragraph 8.2 of PD 47 requires an approach compliant with Ainsworth v Stewarts Law LLP [2020] EWCA Civ 178. Those who do not comply on a timely basis risk non-compliant points of dispute being struck out or, as a minimum, costs sanctions, and late variations under paragraph 13.10 risk being disallowed or permitted only on conditions, including as to costs.

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Duty To Investigate BTE Insurance | Adequacy Of Enquiries And Recoverability Of Success Fees As Between Solicitor And Client

In Evans v Fletchers Solicitors Limited [2026] EWHC 1523 (SCCO), Senior Costs Judge Rowley determined whether a solicitor’s failure to make adequate enquiries into before the event legal expenses insurance rendered a success fee of £30,365.13 irrecoverable on a solicitor and own client assessment under section 70 of the Solicitors Act 1974. The claimant had settled a personal injury claim for £250,000 and was billed £61,615.13, inclusive of that success fee capped at 25% of damages under the Jackson Cap. The claimant held family legal expenses cover managed by DAS under a Zurich home policy, but the defendant made no enquiries of either insurer in 2017 and, when enquiries were eventually made in 2019, contacted Zurich rather than DAS directly, never telephoning Zurich despite a contact number being prominently displayed, and never reaching DAS at all. Applying the framework established in Sarwar v Alam [2001] EWCA Civ 1401 and Garrett v Halton Borough Council [2006] EWCA Civ 1017, the judge found the enquiries wholly inadequate. On the balance of probabilities, BTE cover had been available, the claimant would have used it, and no success fee would then have been required. The judge rejected the argument that the £50,000 indemnity limit rendered the policy unsuitable, noting the ATE policy actually incepted was itself insufficient to fund a trial. The judge also rejected the McDaniel approach of disallowing base costs entirely, distinguishing union backed funding from an LEI indemnity arrangement. The success fee was disallowed in full.