Ainsworth Applied | Preliminary Points Struck Out for Lack of Particularity

Points of Dispute form under CPR 44.5 detailed assessment procedures

ST FRANCIS GROUP 1 LIMITED & ORS V KELLY & ANOR [2025] EWHC 125 (SCCO)

Judge Leonard strikes down broad challenges in £468K costs battle, emphasising the precision required in Points of Dispute under CPR 44.5 following Ainsworth principles. The judgment in St Francis Group v Kelly clarifies rules for contesting costs in inter partes assessments, rejecting “cut-and-paste” objections in a case stemming from failed fraud allegations.
Link to full judgment

Points of Dispute must be prepared in a way which ensures that a detailed assessment hearing can be managed in a fair, just and proportionate way. For example, it is not open to a paying party to insist that the court trawl through every item in a bill of costs to ensure that there is no objection to it. It is for the paying party to raise clear and pertinent points upon which the court can adjudicate.

Citations

Ainsworth v Stewarts Law LLP [2020] EWCA Civ 178 Points of dispute in detailed assessments must clearly identify specific items being challenged and provide concise reasons for objections, ensuring the receiving party can adequately respond and allowing the court to manage the hearing in a fair, just, and proportionate manner. O’Sullivan v Holmes and Hills LLP [2023] EWHC 508 (KB) Challenges to document time in solicitor-client assessments require objections to reference specific items within supporting schedules, ensuring that each objection meets necessary standards of particularity to avoid unfairness or inefficiency in the assessment process. Kazakhstan Kagazy PLC v Zhunus [2015] EWHC 404 (Comm) The reasonableness of costs must be assessed in light of the necessity and proportionality of the work undertaken, especially in high-value litigation, and should reflect efficient cost management at all stages of the litigation process. Wazen v Kahn [2024] EWHC 1083 (SCCO) Points of dispute in inter partes assessment must aim for clear and particularised objections but allow for a slightly less exacting standard of detail compared to solicitor-client disputes, recognising the paying party’s lack of access to the receiving party’s files.  
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Key Points

  • For costs assessments made under the terms of a contract, CPR 44.5 establishes a presumption that the costs are reasonably incurred and reasonable in amount, unless specifically rebutted or the contract provides otherwise. [27, 59]
  • Points of Dispute in detailed assessments must be specific, concise, and specific to individual items in the bill, identifying the nature and grounds of the objection. Generalised or vague objections are insufficient and may result in the objection being struck out. [38-40, 49, 56, 57, 59]
  • The burden falls on the paying party to rebut the presumption under CPR 44.5(1) that each item in a receiving party’s bill is reasonable in amount and was reasonably incurred. This includes demonstrating why a particular item, either in amount or its nature, falls outside recoverability. [56, 60, 90]

"Points of Dispute must be drafted to enable the parties and the court to determine precisely what is in dispute and why. This avoids parties spending time identifying objections during the hearing. It is incumbent upon the paying party to provide clear, specific points of dispute that the receiving party can reasonably respond to, ensuring a fair and proportionate assessment process."

Key Findings In The Case

  • The first Defendant’s blanket objection to every timed item in the Claimants’ bill of costs (except for items related to bill preparation) was found to lack specificity and failed to identify which objections applied to individual items in accordance with CPR 47.14(6) and PD 47.8.2. These objections were therefore struck out as inadequately particularised, except for specific items referenced explicitly [62–66, 80, 96, 102, 104, 119].
  • The Claimants’ costs were recoverable under an indemnity in the Claim Waiver deed, which imposed no specific limitations on types of recoverable work or their financial quantum, provided they were reasonable. Costs related to in-house counsel work (e.g., supporting trial preparations) were within the scope of recovery, as they aligned with the Claimants’ legitimate business interests [70–73, 79].
  • The court rejected the first Defendant’s argument that the total amount of the Claimants’ costs was “unusually high” compared to other costs incurred in related disclosure processes. The assessment of costs on the indemnity basis required consideration of whether each individual item was reasonable in amount and scope, rather than a generalised comparison [81–85].
  • The claim by the first Defendant that duplication occurred between the Claimants’ solicitors, external solicitors acting for Mr Baker and Mr Braid, and external consultants (e.g., Epiq), was struck out due to a complete lack of particularity. The first Defendant failed to specify which items in the Claimants’ bill overlapped or duplicated corresponding items elsewhere [106–110].
  • The court held that the first Defendant had failed to comply with the requirement under CPR 44.5 to rebut the presumption of reasonableness for any particular item in the Claimants’ bill. Generalised and vague objections, without item-specific evidence or reasoning, did not satisfy the burden of rebuttal under CPR 44.5(2) [59–61, 92, 113].

"The purpose of Points of Dispute is to ensure that all objections are identified clearly and in advance, preventing the receiving party from being ambushed during assessment. A lack of particularity, leaving the receiving party to guess which items are disputed and why, undermines fairness and frustrates the court’s ability to manage the hearing proportionately."

Background

The case of St Francis Group 1 Limited and others versus John Thomas Kelly and others involved a complex dispute arising from a management buy-out (MBO) transaction. The Kelly family sold two of their companies to a group of purchasers represented by the Claimants in 2017. As part of the transaction, the first Defendant, John Thomas Kelly, executed a Claim Waiver, which included an indemnity against all losses incurred by the Claimants in connection with any claims. In 2020, despite the Claim Waiver, the Defendants initiated proceedings against Mr Baker and Mr Braid, alleging fraud. The claim was unsuccessful, and the court found in favour of the Claimants, including a successful counterclaim for indemnity under the Claim Waiver.

Costs Issues Before the Court

The primary costs issues before the court involved the detailed assessment of costs payable by the first Defendant to the Claimants under the terms of the Claim Waiver. Key issues included whether the Claimants were entitled to recover in-house legal costs, the reasonableness of the costs incurred, and the scope of the indemnity provided by the Claim Waiver. Additionally, there were disputes over the particularisation of the first Defendant’s Points of Dispute, which were deemed inadequate by the court.

The Parties’ Positions

The Claimants argued that they were entitled to an indemnity for all reasonable and properly incurred costs related to the fraud claim, including both external legal costs and in-house legal costs. They contended that the first Defendant’s Points of Dispute were inadequately particularised and should be dismissed. The first Defendant argued that the Claimants’ costs were excessive and not within the scope of the indemnity, and he sought significant reductions. He also claimed that the Claimants had not managed the disclosure exercise cost-effectively.

The Court’s Decision

The court determined that the Claimants were entitled to recover costs under the indemnity provided by the Claim Waiver, including in-house legal costs, as long as they were reasonable in amount. The court found that the first Defendant’s Points of Dispute were largely inadequately particularised and struck out several preliminary points. The court allowed some specific challenges to proceed, requiring the first Defendant to rebut the presumption that each item of cost was reasonable. The court also noted that the first Defendant’s approach was calculated to increase costs and difficulty for the Claimants.

The Court’s Approach to Particularity

Judge Leonard’s decision reinforces that Points of Dispute under CPR 44.5 cannot rely on generic, “cut-and-paste” objections. The first Defendant’s approach of inserting identical objections against every timed item in the £468,687 bill was found to be meaningless and contrary to Ainsworth principles.

The court struck out preliminary points that failed to identify specific items being challenged. This included complaints about “excessive time” and “duplication” that gave no details about which entries were disputed or why.

Practical Implications for Costs Practitioners

The judgment clarifies that paying parties must rebut the CPR 44.5 presumption that costs are reasonably incurred and reasonable in amount. Broad assertions about costs being “unusually high” without item-specific objections will not succeed.

The decision emphasises that detailed assessment hearings must be managed fairly and proportionately. Courts will not accept Points of Dispute that force parties to identify objections during the hearing itself.

Key Takeaways

For costs draftsmen preparing Points of Dispute under CPR 44.5, the St Francis v Kelly judgment confirms that specificity is essential. Each objection must clearly identify the disputed item and provide concise grounds for challenge, ensuring the receiving party can adequately respond.

Points Of Dispute In Solicitor And Client Assessments | The Court Of Appeal Speaks

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ST FRANCIS V KELLY & ANOR [2025] EWHC 125 (SCCO) | COSTS JUDGE LEONARD | CPR 44.5 | CPR 47.14(6) | PRACTICE DIRECTION 47 PARAGRAPH 8.2 | INDEMNITY BASIS | AINSWORTH V STEWARTS LAW LLP [2020] EWCA CIV 178 | O’SULLIVAN V HOLMES AND HILLS LLP [2023] EWHC 508 (KB) | WAZEN V KAHN [2024] EWHC 1083 (SCCO) | KAZAKHSTAN KAGAZY PLC V ZHUNUS [2015] EWHC 404 (COMM) | MASTER PESTER | JACOBS J | COCKERILL J | DISCLOSURE COSTS | IN-HOUSE LEGAL COSTS | ADMINISTRATIVE TASKS | GRADE OF FEE EARNER | DUPLICATION OF COSTS | POINTS OF DISPUTE | BILL OF COSTS | TAB 14 | PRECEDENT G | REASONABLY INCURRED | REASONABLE IN AMOUNT | AMBIGUOUS OBJECTIONS | SPECIFICITY REQUIREMENTS | PROPORTIONALITY EXCLUSION | MANAGEMENT TIME COSTS | THIRD-PARTY DISCLOSURE | CLAUSE-SPECIFIC INDEMNITY | ROLLING BASIS REDUCTIONS | UNAMBIGUOUS OBJECTION PRINCIPLE | CPR 44.11 | FRAUD CLAIM LEGAL COSTS | MISMANAGED DISCLOSURE OBJECTION | EPIQ CONSULTANTS | REYNOLDS PORTER CHAMBERLAIN LLP | HIGH-VALUE COMMERCIAL LITIGATION COSTS | TIMED ITEMS | SOLICITOR/CLIENT WORK | LEGAL BILL PREPARATION COSTS | GENERAL MATTERS OF PRINCIPLE | AMBIGUITY IN POINTS OF DISPUTE | DUPLICATIVE REVIEW STANDARD.