Costs Cross-Appeal Fails Where Challenge Arose From Applicant's Own Default

An applicant for relief from sanctions ordered to pay the costs of that application could not reduce his liability merely because the respondent raised and lost a discrete jurisdictional argument, where that argument arose only because of the applicant’s own procedural failure to serve the claim form properly.

GOOGLE LLC V ROBERTSON [2025] EWCA Civ 1262

In Robertson v Google LLC, the Court of Appeal dismissed a costs cross-appeal challenging an order that an applicant for relief from sanctions pay all costs of the application, including costs relating to the respondent’s unsuccessful jurisdictional arguments. Mr Robertson had failed to serve Form N510 when serving his claim form on Google in the USA, invalidating service under CPR 6.34. He applied for relief from sanctions, which the first instance judge granted. Google raised a separate jurisdictional challenge regarding Equality Act claims, which failed. The judge ordered Mr Robertson to pay all costs of the application. On appeal, the Court of Appeal allowed Google’s main appeal, holding CPR 7.6(3) (not CPR 3.9) governed extensions of time for service, rendering the proceedings a nullity. On the costs cross-appeal, the court held the judge had properly exercised his discretion in awarding all costs to Google. Google’s jurisdictional arguments arose from and were causally connected to Mr Robertson’s service failure, forming part of the same dispute. The court emphasized the high threshold for costs appeals established in SCT Finance v Bolton, noting the judge had already made extensive reductions to Google’s claimed costs.

"...I consider that Google were entitled to raise the territorial jurisdictional point before the judge because, if Mr Boch had been right and what mattered was the relief from sanctions regime, then the overall merits in such a case can matter very much. If Google could have shown that some of these claims were outside the jurisdiction in any event, then so much the better for them. The points were open to them to take and, even though they failed, they only arose at all because of Mr Robertson's failure to effect valid service."

Citations

Barton v Wright Hassall LLP [2018] UKSC 12, [2018] 1 WLR 1119 Service of a claim form is a fundamental procedural requirement, and rules governing service are jurisdictional in nature rather than merely procedural, making relief from sanctions under CPR 3.9 inapplicable to service failures. R (Good Law Project Ltd) v Secretary of State for Health and Social Care [2022] EWCA Civ 355, [2022] 1 WLR 233 Rules on service of a claim form are strictly enforced because proper service founds the court’s jurisdiction; CPR 3.9 relief from sanctions is not available for failures of service or requests to extend time under CPR 7.6. Denton v TH White Ltd (De Laval Ltd, Part 20 Defendant) (Practice Note) [2014] EWCA Civ 906, [2014] 1 WLR 3926 Relief from sanctions under CPR 3.9 is available only after proceedings have been properly commenced; it cannot be used to retroactively validate service defects or displace specific rules such as CPR 7.6. Hoddinott v Persimmon Homes (Wessex) Ltd [2007] EWCA Civ 1203, [2008] 1 WLR 806 A defendant who files an acknowledgment of service but fails to apply under CPR 11 to challenge jurisdiction within 14 days is deemed to have accepted the court’s jurisdiction to try the claim. Pitalia v NHS England [2023] EWCA Civ 657, [2023] 1 WLR 3584 Failure to tick the jurisdiction box in a timely filed acknowledgment of service does not automatically prevent a jurisdiction challenge if surrounding circumstances make the defendant’s position clear. Dubai Financial Group LLC v National Private Air Transport Services Co Ltd [2016] EWCA Civ 71 There is no obligation on a defendant to respond to invalid service, and time for acknowledgment of service does not begin to run unless and until the claim form is validly served. Vinos v Marks & Spencer PLC [2001] 3 All ER 784 (CA) Where a specific rule imposes conditions for retrospective extensions of time, the general powers under CPR 3.9 or 3.10 cannot be used to circumvent those restrictions. Ideal Shopping Direct Ltd v Mastercard Inc [2022] EWCA Civ 14, [2022] 1 WLR 1541 Rule 3.10 cannot be relied upon to validate defective service where the specific conditions of CPR 7.6(3), requiring prompt and reasonable compliance, are not satisfied. National Navigation Co v Endesa Generacion SA (The Wadi Sudr) [2009] EWHC 196 (Comm) Form N510 is essential in asserting jurisdiction for service outside the jurisdiction and must transparently and truthfully state the grounds relied upon, due to its jurisdictional implications. Swivel UK Ltd v Tecnolumen GmbH [2022] EWHC 825 (Ch) An applicant for relief from sanctions will generally be liable for the costs of the application, following the principle that the party in breach should bear the consequences. SCT Finance Ltd v Bolton [2002] EWCA Civ 56, [2003] 3 All ER 434 Appellate courts should not interfere with a judge’s costs order unless satisfied that the judge erred in principle or exercised discretion in a way clearly wrong. Hand Held Products Inc v Zebra Technologies Europe Ltd [2022] EWHC 640 (Ch) A defendant need not apply under CPR 11 to challenge defective service when they do not acknowledge service and deny that any valid service occurred. Shiblaq v Sadikoglu [2004] EWHC 1890 (Comm) Where no valid service has taken place, default judgment cannot be obtained simply because the defendant failed to make a jurisdiction challenge under CPR 11; formalities cannot override substantive defects in service.

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Key Points

Costs orders made at first instance are exercises of judicial discretion and will not be interfered with on appeal unless the decision is shown to be unprincipled or outside the permissible bounds of discretion.
The court is not required to produce detailed reasons for its costs decision where the grounds have been argued and considered, and where it is apparent from the context that the points were before the court.
Where a respondent raises additional arguments in opposition to an application arising from a claimant’s default, the judge has discretion to award the respondent its costs of those arguments, even if unsuccessful, particularly where they were reasonably connected to the principal application and arose from the claimant’s default.
A judge’s discretionary decision on costs is not undermined solely because a reduction in costs might have been appropriate; what matters is whether the decision was within the ambit of reasonable judicial discretion, not whether the appellate court would have decided differently. ]
An applicant who seeks relief from sanctions is generally liable for the costs of that application; however, where the respondent raises unsuccessful arguments that are not strictly necessary to determine the application, the court may reduce the costs award to reflect this, though such reduction is not mandatory.

"This is an appeal brought with leave of the single Lord Justice from the county court in relation to costs. As such, it is overcast, from start to finish, by the heavy burden faced by any appellant in establishing that the judge's decision falls outside the discretion in relation to costs conferred upon him under CPR 44.3(1). For reasons of general policy, namely that it is undesirable for further costs to be incurred in arguing about costs, this court discourages such appeals by interpreting such discretion very widely."

Key Findings In The Case

The judge found that Mr Robertson’s failure to effect valid service of the claim form by failing to file and serve Form N510 was the primary cause of the litigation over service and jurisdiction, and therefore he was liable for the costs of the application for relief from sanctions, even though Google’s jurisdictional challenge was ultimately unsuccessful.
The judge rejected Mr Robertson’s argument that there was no causal connection between his default in service and Google’s jurisdiction challenge under CPR r.6.33(2B), finding that the entirety of the contested proceedings, including the jurisdiction issue, flowed from Mr Robertson’s failure to serve the claim properly.
The judge was found to have had full awareness of the parties’ submissions on apportioning costs between the relief from sanctions application and the jurisdiction challenge, despite addressing it succinctly, and his judgment was deemed sufficient without separately articulating reasoning on each component of the claim for costs.
The court held that Google’s decision to raise the territorial jurisdiction point was a reasonable part of its opposition to Mr Robertson’s application for relief from sanctions, as success on that issue could have further undermined Mr Robertson’s claim, thereby justifying the inclusion of related costs as part of those arising from the principal application.
Notwithstanding that a modest reduction in Google’s awarded costs might have been justifiable, the judge’s decision to award full costs was not outside the proper bounds of judicial discretion and therefore could not be disturbed on appeal.

"I should say that, if I had been the judge, I may have made a 20% reduction in Google's costs to reflect their failure on the territorial jurisdiction issue. But that is not the test. What matters is whether the judge's decision on costs was open to him. Here, I think it was. It certainly was not unprincipled, particularly in circumstances where the judge went on to make extensive reductions to the actual costs claimed by Google. That was all part of his wide-ranging discretion, with which this court should not interfere."

Background

The claim was brought by Colin Robertson against Google LLC concerning the termination of a contract under which Mr Robertson provided YouTube videos. The termination occurred on 22 February 2021, and Mr Robertson alleged that Google’s actions, including “demonetising” and “shadow banning” his channel, amounted to unlawful discrimination under section 29 of the Equality Act 2010 or, alternatively, breach of contract. A claim form was issued on 7 October 2021, with a requirement for service on Google in the USA within six months, by 7 April 2022. On 5 April 2022, the claim form was delivered to Google’s headquarters, but the mandatory Form N510, required under CPR rule 6.34 for service out of the jurisdiction, was not filed with the court or served with the claim form. Google pointed out this omission on 19 April 2022, confirming that valid service had not been effected. In response, Mr Robertson filed Form N510 with the court on 22 April 2022 and applied for relief from sanctions, seeking to validate the service or extend time for service.

The application for relief was heard by Deputy District Judge Grout on 17 May 2023. The judge determined that valid service had not occurred by 5 April 2022 due to the absence of Form N510. The primary dispute centred on whether CPR rule 7.6(3) (governing extensions of time for service) or rule 3.9 (relief from sanctions) applied to rectify the defect. The judge, influenced by authorities cited, applied the rule 3.9 test and granted relief from sanctions, deeming service to have taken place on 5 April 2022. A separate jurisdictional challenge by Google, arguing that the Equality Act claims required permission to serve out of the jurisdiction, was rejected by the judge. Following the judgment, the judge issued a costs order dated 14 August 2023, requiring Mr Robertson to pay the costs of the application for relief from sanctions. Mr Robertson appealed this costs order, leading to a cross-appeal in the Court of Appeal.

The Costs Cross-Appeal

The costs issue before the Court of Appeal arose from the judge’s order that Mr Robertson pay the costs of his application for relief from sanctions. Mr Robertson contended that the costs order should not encompass costs incurred by Google in pursuing its unsuccessful jurisdictional challenge regarding the Equality Act claims. The key question was whether there was a causative link between the application for relief and the jurisdictional challenge, and if so, whether the judge had properly exercised discretion in awarding costs. The issue required consideration of whether costs related to distinct, unsuccessful arguments should be excluded from the general principle that an applicant for relief from sanctions typically bears the costs of the application.

The Parties’ Positions

Mr Robertson, through his counsel Mr Boch, argued that the costs order should be varied to exclude costs associated with Google’s jurisdictional challenge. It was submitted that this challenge was separate from the service issue and had been lost by Google, meaning there was no causal connection to the relief application. Mr Boch relied on the principle that costs should follow the event only for issues directly related to the application, citing that the general rule in cases like Swivel UK Ltd v Tecnolumen GmbH (where an applicant for relief pays costs) should not apply to unrelated, unsuccessful arguments. He emphasised that Google’s jurisdictional challenge concerned whether permission was needed to serve the Equality Act claims out of the jurisdiction, which was distinct from the defect in service due to the missing Form N510.

Google, represented by Ms Evans KC and Mr Roberts, maintained that the costs order was appropriate. They argued that all costs incurred were part of the same application process and arose directly from Mr Robertson’s failure to effect valid service. It was submitted that the jurisdictional challenge was a legitimate aspect of their response to the application, as it went to the merits of whether relief should be granted. Google contended that the judge had broad discretion under CPR rule 44.3 and that the costs order was a proper exercise of that discretion, reflecting the overall context where Mr Robertson’s default necessitated the application.

The Court’s Decision on Costs Cross-Appeal

The Court of Appeal dismissed Mr Robertson’s costs cross-appeal. Lord Justice Coulson, delivering the leading judgment, held that the judge’s costs order was within his discretion and not open to challenge. The court noted that appeals against costs orders face a high threshold, as established in SCT Finance v Bolton, where it was emphasised that appellate intervention is rare unless the decision is unprincipled or outside the wide discretion afforded to first-instance judges.

The court found that the judge had been aware of Mr Robertson’s arguments regarding the jurisdictional challenge but had reasonably concluded that the costs were incurred as a result of the application for relief. It was determined that Google’s jurisdictional challenge was not separate but formed part of the overall dispute stemming from Mr Robertson’s failure to serve the claim form correctly. The court observed that if the relief application had not been made, the jurisdictional issue would not have arisen, establishing a causative link. Although Lord Justice Coulson indicated that, if deciding afresh, he might have reduced the costs by 20% to account for Google’s lack of success on the jurisdictional point, he stressed that this did not render the judge’s decision erroneous. The judge had already made significant reductions to Google’s claimed costs, demonstrating a balanced exercise of discretion. Consequently, the court upheld the costs order, requiring Mr Robertson to pay the costs of the application.

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