Introduction: The Liquidator’s Role and the Specter of Personal Costs When a company faces insolvency, a liquidator steps in to manage its affairs. This crucial role involves realising assets, investigating the company’s dealings, and distributing proceeds to creditors. Naturally, this process incurs costs – from the liquidator’s own fees to legal and administrative expenses. Generally, […]
When a dispute arises in relation to a Land Registry application and eventually proceeds to the First-tier Tribunal (Property Chamber), parties often overlook a critical question: who pays the legal costs incurred before the Tribunal gets involved? The short answer: Costs incurred before the matter is formally referred to the Tribunal are considered to be […]
Ever found yourself with a Part 7 claim form where the “value” section is conspicuously blank? This often happens when the main goal isn’t a straightforward sum of money – think of applications for injunctions, or TOLATA (Trusts of Land and Appointment of Trustees Act 1996) claims seeking orders about property occupation, ownership shares, or […]
In the busy world of civil litigation, the wording of a court order is paramount. Every phrase, every comma can have significant implications. But what happens when an order is conspicuously silent on the issue of costs? This isn’t just a minor oversight; it triggers a specific rule – Civil Procedure Rule (CPR) 44.10 – […]
In the complex world of civil litigation, instructing expert witnesses is a common and often necessary step. Experts provide vital opinions on technical, medical, or other specialist matters that lie outside the knowledge of the judge. But what happens when you instruct an expert, pay their fee, receive their report, and then, for whatever reason, […]
Vardy v Rooney [2025] EWHC 851 (KB) addressed procedural issues concerning costs budgeting and potential professional misconduct in legal proceedings. The case involved an appeal against a costs judge’s decision regarding the Defendant’s legal team’s conduct in completing Precedent H costs budgets. The court considered whether the Defendant’s solicitors had acted unreasonably or improperly by presenting incurred costs figures that were lower than actual costs without explicitly explaining this approach during costs management hearings. Mr Justice Cavanagh, with the assistance of Acting Senior Costs Judge Jason Rowley, applied the principles from Bamrah v Gempride to assess potential misconduct under CPR 44.11. The judgment emphasised the importance of transparency in costs budgeting while maintaining a narrow interpretation of “unreasonable” and “improper” conduct. Ultimately, the court found that while the Defendant’s legal advisers could have been more transparent, their actions did not cross the threshold of misconduct, and the appeal was consequently dismissed. The decision underscored the appellate court’s approach of judicial restraint in evaluating costs-related conduct, particularly where the first-instance judge had made a careful evaluative judgment.
In Chaudhry v AXA Insurance UK Plc, the County Court at Guildford addressed the scope of information disclosure obligations under CPR Part 18 concerning costs recoverability. The Defendant sought further details regarding medical fees incurred through a third-party agency, arguing that such transparency was essential to ensure costs were reasonable and proportionate. The Claimant contended that the requested information was commercially sensitive, unavailable to him, and unnecessary in light of the court’s ability to summarily assess costs at the conclusion of proceedings. District Judge N Murphy found in favour of the Defendant, concluding that the Claimant’s agent, as an extension of the Claimant, should provide the requested breakdown to enable a fair assessment of the recoverable costs. The Court also imposed sanctions for non-compliance, capping the recoverable disbursements if the order was not adhered to.
In Associated Newspapers Limited v. The United Kingdom, the European Court of Human Rights (Fourth Section) considered whether the recoverability of success fees and After the Event (ATE) insurance premiums under UK domestic costs rules violated Article 10 of the Convention. The applicant, a prominent media publisher, challenged its liability to pay these costs in privacy and defamation proceedings brought against it. The applicant argued that the recoverability of such costs created an unbalanced and disproportionate cost regime, deterring free expression. The Government contended that the costs system pursued the legitimate aim of access to justice and that subsequent reforms mitigated its alleged disproportionality. The Court held that the recoverability of success fees against media defendants remained incompatible with Article 10, as it created excessive financial burdens undermining free expression, exceeding the State’s margin of appreciation. However, it ruled that the recoverability of ATE premiums could be justified on a case-by-case basis, finding no violation in this instance due to the protective function of ATE insurance in enabling unsuccessful defendants to recover costs.
In the case of Blue Manchester Limited versus Howard Kennedy LLP, the SCCO considered whether 15 interim invoices delivered by the Defendant solicitors between January 2021 and June 2022 were valid interim statute bills within the meaning of section 70(3)(a) of the Solicitors Act 1974, and whether any “special circumstances” justified their court-ordered assessment.
The Claimant argued that the invoices could not be statute bills because they were not genuinely final for the service periods they covered, particularly given the conditional fee agreement (CFA) under which Howard Kennedy’s fees were substantially discounted but subject to possible top-up charges contingent on the arbitration’s outcome. Blue Manchester also questioned the accuracy of the Defendant’s cost estimates and invoices, citing both a retrospective overcharge admitted by the solicitors and the Defendant’s inconsistent communication about a revised overall cost estimate.
Conversely, the Defendant maintained that the terms of the CFA, combined with their standard business terms, permitted the issuance of monthly interim statute bills, thereby triggering the statutory deadlines for assessment challenges.
Costs Judge Nagalingam ultimately found for the Claimant, concluding that Howard Kennedy’s failure to adequately clarify the status and finality of the bills, particularly due to the contingent nature of the CFA’s top-up provision, precluded treating them as interim statute bills. The Judge further held that special circumstances existed, significantly influenced by the admitted overcharging, the late communication of drastically revised cost estimates, and the ongoing uncertainty around the invoices’ completeness.