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no costs recoverable for small claims in the Court of Appeal

18 July 2014

The costs decision in the Court of Appeal case of Akhtar v Boland has decided that the ‘no costs’ rule for small claims cases applies to the costs of any appeal to the Court of Appeal.

The Civil Procedure Rules are very clear in stating that in relation to cases which have been allocated to the small claims track the court may not make a costs order, save for in certain limited circumstances.  However, it was widely considered that costs incurred in connection with an appeal to the Court of Appeal would be recoverable.  This was based on the current guidance contained within the Supreme Court Practice (the ‘White Book’) which states that “second appeals against small claims decisions in the Court of Appeal are subject to full costs shifting”.

The Court of Appeal in Akhtar found the note in the White Book to be incorrect and reluctantly concluded that it was precluded from making a costs award in connection with the appeal.

This is another disincentive removed to discourage determined litigants in person from lodging an appeal following an unsuccessful small claims hearing.

 

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