Beyond the Blue Pencil Test | Beneficiaries’ Wider Rights Under Section 71(3)
“Whatever the reason for Lloyd LJ’s assumption, in my judgment it was wrong. For the reasons set out at [4] to [26] above, I would hold that there are material differences between applications under section 71(3) and those under section 71(1) because of the different nature of the interests of the third party that the different sub-sections are intended to reflect. The consequence of Lloyd LJ’s mistaken assumption is that his judgment cannot be relied upon as saying anything authoritative about the position that obtains where an application and assessment are brought under section 71(3): his judgment simply does not deal with that question. Furthermore, in my judgment there is no rational basis for transposing the principles that apply to a section 71(1) assessment, as identified in [95] of Tim Martin, to the different circumstances of an assessment pursuant to section 71(3). I would therefore reject the appeal under Ground 1 on the basis of principle and the absence of any binding authority that requires us to apply the Tim Martin principles to an assessment under section 71(3). In my judgment the Costs Judge was correct to find that Tim Martin was distinguishable and should be distinguished – essentially for the reasons he gave – and that the relevant principles to be applied are to be derived from In re Brown, which is binding on us.”