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updated Gould v Armstrong C.A.

21 August 2002
The issues

Costs – proportionality.

The facts

The Claimants brought an action against the Defendants who counterclaimed. The matter came before District Judge Turner in the Barnstaple County Court, who gave Judgment on the claim for £4,500.00 and on the Counterclaim for £3,715.00. There was a separate Hearing on costs. The Claimants were awarded £2,000.00 in respect of their costs on the claim, and the Defendant £5,000.00 in respect of their costs on the Counterclaim. The Claimant appealed to Judge Overend, who allowed that Appeal. He substituted a new Order, namely that the Defendant pay half of the Claimant’s costs on the claim and on the Counterclaim (totalling £4,600.00). The Claimant was awarded the costs of the Appeal. The Defendant’s Solicitors meanwhile had been corresponding with the Claimant with a settlement offer warning of the risks of costs getting out of control and being disproportionate to the value of the awards in the action. The offers were refused. The Defendant appealed.

The decision

1. This was the sort of satellite litigation in respect of costs that should be discouraged. It was disproportionate.

2. The conciliatory approach should have been adopted by the parties.

3. Litigants should be cautious before appealing a Costs Order.

4. The Judge had had available to him neither the decision in English –v- Emery Reimbold and Strick Limited, (Court of Appeal gave guidelines on issue of Appeal against a decision of a Judge on the grounds that reasons were inadequate), nor the Transcript of the District Judge’s Judgment. The Court of Appeal were better placed therefore to consider the District Judge’s Judgment than the Judge.

The District Judge had shown a robust wisdom in trying to resolve the costs issue without having to put it to Detailed Assessment.

5. It was not open to the Judge to substitute his discretionary decision for that of the District Judge.

6. The Judge being unaware of the District Judge’s reasonings should have asked him for a full explanation and indeed the District Judge in his Judgment that was not before the Judge had offered to the parties to do so if necessary.

Decision of the Judge set aside and the District Judge’s Order reinstated. (Claimant was not represented at this Appeal before the Court of Appeal).

Comments

The Court of Appeal carried out a Summary Assessment of costs at the conclusion of the Hearing. We mention it because this was a case where, in respect of a Hearing before the Court of Appeal alone, the Conditional Fee Agreement provided for a 100% uplift of Solicitors costs and Counsel’s fees. The Court of Appeal allowed this uplift in full apparently on the basis that this was a developing area of law and was justifiable.

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The content on this page is provided for the purposes of general interest and information. It contains only brief summaries of aspects of the subject matter and does not provide comprehensive statements of the law. It does not constitute legal advice and does not provide a substitute for it.

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