Invenia Technical Computing Corporation and Invenia Labs Limited v Matthew Hudson involved a dispute between Invenia Technical Computing Corporation, a Canadian company that designed and developed software to optimise the efficiency of electricity grids, and its wholly-owned English subsidiary Invenia Labs Limited (collectively referred to as “Invenia”) and their former CEO and director, Matthew Hudson.
Following an internal investigation in 2022, Invenia concluded that Mr Hudson had committed various acts of dishonesty as CEO and had benefitted personally from them. His employment was terminated and he resigned his directorships. Invenia then began civil proceedings against him for breach of fiduciary duty in December 2022. Mr Hudson firmly denied all allegations of wrongdoing.
On 15 December 2022, Invenia obtained an electronic imaging order (EIO) against Mr Hudson on a without notice basis from Cotter J. The EIO required Mr Hudson to provide access to his electronic devices and online accounts to named computer specialists for the purposes of making copies, following which the devices would be returned to him. Cotter J found there was a strong prima facie case Mr Hudson had breached his fiduciary duties, a real possibility he would destroy evidence, and that such conduct was likely to be replicated in future based on previous examples.
Chronology of Key Events
- 15 Dec 2022: Invenia obtains without notice EIO against Mr Hudson from Cotter J
- 16 Dec 2022: Cotter J grants Invenia order for alternative service and passport order on without notice basis
- 21 Dec 2022: Mr Hudson’s application to discharge the passport order is dismissed by Bennathan J, costs reserved
- 13 Jan 2023: Mr Hudson applies to discharge the EIO alleging Invenia did not properly authorise their solicitors and/or failed to give full and frank disclosure
- 1-2 Feb 2023: Mr Hudson’s application to discharge EIO dismissed after 2-day contested hearing before Adrian Williamson KC (Deputy High Court Judge). Costs orders made in Invenia’s favour on passport and EIO discharge applications. Mr Hudson ordered to pay £152,274.75 on account of costs by 16 Feb 2023 (remains unpaid).
- 21 Jun 2023: Invenia applies to vary para 7 of EIO so two laptops returned to them rather than Mr Hudson after imaging
- 22 Jun 2023: Constable J directs Mr Hudson to file evidence in response to variation application by 12 Jul 2023
- 17 Jul 2023: Mr Hudson files 5 witness statements in response to variation application
- 15 Sep 2023: Hill J orders variation application will be struck out unless Invenia confirms pursuit by 29 Sep 2023
- 29 Sep 2023: Invenia initially indicates will pursue variation application
- 6 Oct 2023: Invenia informs Court and Mr Hudson that variation application will be withdrawn
- 10 Oct 2023: Mr Hudson files statement of costs claiming £379,900 incurred in responding to variation application
- 20 Dec 2023: Soole J dismisses withdrawn variation application and orders Invenia to pay Mr Hudson’s costs on standard basis, to be assessed if not agreed
- 22 Dec 2023: Mr Hudson applies for payment on account, claiming total costs of £407,900
- 28 Dec 2023: Master Stevens orders Invenia to file responsive evidence by 11 Jan 2024
- 9 Jan 2024: Invenia requests 7-day extension to 18 Jan 2024 to file responsive evidence due to Christmas/New Year leave
- 11 Jan 2024: Invenia applies for extension of time, which is granted by Master Gidden to 24 Jan 2024, costs reserved
- 7 Feb 2024: Hearing before Julian Knowles J on Mr Hudson’s application for payment on account and costs of Invenia’s extension application
Issues to be Decided
The key issue to be determined by the Court was:
- Whether Mr Hudson should be awarded a payment on account of his costs of responding to Invenia’s application to vary the EIO, which application Invenia withdrew and was dismissed by Soole J with costs to Mr Hudson. The presumption under CPR r 44.2(8) is that the Court will order a payment on account of a reasonable sum “unless there is good reason not to do so.”
Mr Hudson sought a payment of £230,000 to £260,000, being 2/3 of what he contended a lawyer would recover on detailed assessment (£315,000-£360,000) plus a £20,000 disbursement. His total costs claimed were £407,900, based on his own time of 393 hours at £800/hr (£314,600), fees to a Robyn O’Reilly for legal services (£73,300), and the £20,000 disbursement for an expert in Ms O’Reilly’s invoice.
Invenia argued there was good reason not to order any payment on account, or at most based on 100 hours at the £19/hr litigant-in-person rate in CPR PD 46 (£1,900), because Mr Hudson’s claimed costs were not credible, reasonable or proportionate given the limited nature of the variation application. They contended his evidence did not prove financial loss from lost consultancy work at £800/hr, Ms O’Reilly’s costs were irrecoverable as she was not authorized to conduct litigation, and the expert disbursement was unsupported.
- The costs of Invenia’s application in January 2024 for a 7-day extension to file evidence in response to Mr Hudson’s application for a payment on account, which Mr Hudson opposed but Master Gidden granted. Invenia sought its costs, arguing Mr Hudson unreasonably refused to agree an extension spanning the Christmas/New Year break.
Parties’ Respective Arguments
On the payment on account application, Mr Hudson argued:
- There was a presumption in favour of a payment on account and no good reason not to order one, as he was awarded costs when Invenia’s variation application was withdrawn and dismissed.
- A payment of £230,000 to £260,000 should be ordered, being 2/3 of what a lawyer would recover plus a £20,000 expert disbursement, taking into account Invenia’s conduct and failure to engage in ADR/mediation.
- His time of 393 hours at £800/hr was properly evidenced by timesheets and justified by Invenia’s conduct, even though the variation sought was narrow, as he planned a “root and branch” challenge to the EIO. His lost consultancy earnings at £800/hr were supported by witness evidence.
- Ms O’Reilly’s fees and the expert disbursement would be recovered in full.
- If a lower amount was ordered, detailed assessment should commence forthwith to avoid prejudice.
Invenia argued:
- There was good reason not to order a payment on account as Mr Hudson’s costs were not credible, reasonable or proportionate. Attempting to assess the likely recovery would be guesswork, so it should be left to detailed assessment.
- Mr Hudson’s 393 claimed hours were unjustifiable for a limited variation application Invenia withdrew prior to filing reply evidence. Spending 156 hours on inter-partes correspondence was impossible to justify when Invenia’s solicitors sent few letters on the application.
- Mr Hudson’s evidence did not prove he lost consultancy work that would have been paid at £800/hr. His witnesses’ ability to pay that rate was doubtful.
- Ms O’Reilly’s fees were irrecoverable as she was not authorized to conduct litigation. Her £73,300 invoice lacked credibility and the 146 hours were very high for the limited application. Her witness statement improperly advocated for Mr Hudson.
- The £20,000 expert disbursement was unsupported as no details of the expert or advice were provided despite requests.
- At most, a modest payment based on 100 hours at the £19/hr litigant-in-person rate (£1,900) could be ordered and set off against the substantial unpaid costs Mr Hudson owed Invenia.
On the extension application costs, Invenia argued it should have its costs as Mr Hudson unreasonably refused a short extension spanning the Christmas/New Year break, which necessitated an application that was granted. An unreasonable refusal to agree an extension should be penalised in costs per Denton v TH White Ltd.
Decision
The judge found there was good reason not to order a payment on account of Mr Hudson’s costs of the EIO variation application, concluding the matter could properly be left to detailed assessment at the end of the litigation:
“I find that Invenia has shown there is a good reason in this case. The matter can properly be left to a detailed assessment at the conclusion of the litigation. The Applicant will not, therefore, lose out, but will in due course be awarded that which he is properly entitled to.” [72]
He determined that the very high amount claimed by Mr Hudson for a simple, uncontested variation provided a reason itself to leave the costs to detailed assessment:
“The amount claimed by the Applicant for a simple and (in the event) uncontested variation to the EIO is very high indeed, and that in and of itself provides a reason for leaving the matter to an experienced costs judge to be decided on detailed evidence.” [73]
The judge did not find credible Mr Hudson’s assertion that he spent 393 hours responding to Invenia’s application:
“In terms of the number of hours he asserts he spent, I do not find the figure of 393 hours to be credible. For the avoidance of doubt, I leave aside that the case against the Applicant in the civil proceedings includes allegations of dishonesty, as to which Cotter J found there to be a ‘strong prima facie case’.” [74]
Given the limited nature of Invenia’s application and supporting evidence, the judge found Mr Hudson’s claimed hours lacked reality, proportionality and reasonableness:
“Invenia’s application was a reasonably limited one, as I have explained. Its evidence in support was comparatively limited (less than 200 pages). The essential contention made by Invenia was merely that two laptops were owned by them rather than by the Applicant and so should be returned to them and not him. Invenia communicated an intention to withdraw the application on 8 October 2023, prior to filing any reply evidence and prior to the application being heard. Whatever the rights and wrongs, the issue was simple.”
“Under these circumstances, as I have said, I find the Applicant’s contention that he spent 393 hours responding to the application to lack reality, let alone proportionality or reasonableness, certainly on the basis of the high-level assessment that I am undertaking. I might be wrong, but if so it will be remedied on detailed assessment.” [75-76]
The judge was not persuaded that Mr Hudson’s claimed hours provided a proper basis to assess a payment on account, finding this a good reason not to order one of the magnitude sought:
“I therefore find overall that on the broad brush approach I have to take, I am not persuaded that the Applicant’s claimed hours provide a proper basis for me to make an assessment for the purposes of ordering a payment on account, and that provides a good reason not to order such a payment, or certainly not one of the magnitude that the Applicant is seeking.” [83]
Furthermore, he was not satisfied Mr Hudson had proven an entitlement to his claimed costs of £800/hr based on lost consultancy earnings:
“I am also not satisfied that the Applicant is entitled to the costs he claims because he lost work (my phrase) due to the time he had to spent on this case, which he would otherwise have spent on paid work…I am sure that Invenia has shown that the Applicant’s evidence does not satisfy these requirements.” [84]
The judge accepted Invenia’s submission that Ms O’Reilly’s costs were unlikely to be recoverable as she was not authorized to conduct litigation:
“As I have explained, a litigant in person can only recover (a) the legal costs of instructing a lawyer competent to conduct the litigation; and/or (b) disbursements which would be recoverable by a legal representative. I therefore accept Invenia’s submission that the Applicant will almost certainly not recover Ms O’Reilly’s costs, given that: (a) she is not a lawyer authorised to carry out reserved legal activities; and (b) her fees as claimed appear to relate to the provision of legal services (described on her invoice as ‘Consultation & Advisory – including Reading Drafting & Preparation of Documents’), and a legal representative would be expected to perform such legal services themselves rather than incurring the costs as a disbursement.” [92]
![Willis v GWB Harthills LLP & Others [2025] EAT 79, His Honour Judge James Tayler, Rule 76 Employment Tribunal Rules 2013, Rule 84 Employment Tribunal Rules 2013, Rule 74 Employment Tribunal Rules 2024, Rule 82 Employment Tribunal Rules 2024, Stage 1 Threshold Conduct, Stage 2 Discretionary Decision, Stage 3 Quantum Decision, Ability to Pay, Costs Discretion, Unreasonable Conduct, Capital Assets in Costs Assessment, Family Home Valuation, Equity Release, Joint Ownership of Property, Detailed Assessment, Standard Basis, Profit Share Entitlement, PHI Payments, Costs Capping, Broad-Brush Assessment, Means Assessment, Proportionality of Costs, Discretionary Factors in Costs Awards, Effect on Third Parties, Honesty of Party, Costs Application Principles, Conduct of Proceedings, Stage 4 Bowel Cancer Context, Zoopla Valuation Evidence, Stage 3 Costs Quantum, Shields Automotive Ltd v Greig, Howman v The Queen Elizabeth Hospital Kings Lynn, Jilley v Birmingham and Solihull Mental Health NHS Trust, Arrowsmith v Nottingham Trent University [2012] ICR 159, Vaughan v London Borough of Lewisham (No 2) [2013] IRLR 713, Doyle v North West London Hospitals NHS Trust, County Court Detailed Assessment, Costs Decision in Employment Tribunals](https://tmclegal.co.uk/wp-content/uploads/2025/06/Shutterstock_351049592-80x80.webp)
