DEFENDANT ORDERED TO PAY COSTS AFTER REFUSING TO PAY PRE-ACTION COSTS: COURT OF APPEAL REFUSES TO GIVE PERMISSION TO APPEAL
In November last year I wrote about the case of Ayton -v- RSM Bentley Bennison & Ors  EWHC 2851 (QB). This was a case in which the defendant refused to pay cost incurred prior to issue. Proceedings were issued and (in a case where the amount in issue was just over £100,000) resulted in the defendant paying the claimant’s costs in excess of £460,000. I am once again grateful to Sam Hayman from Bolt Burdon Kemp for letting me know the result of the defendant’s application for permission to appeal.
LORD JUSTICE LEWISON REFUSED PERMISSION TO APPEAL
Permission to appeal was refused by the Court of Appeal. The notice refusing permission states:-
“1. The judge recorded at  that it was accepted that it was legitimate for Mr Ayton to have issued proceedings in the face of the refusal to pay his costs.
2. From that starting point it followed inevitably that the Part 36 regime would apply to the litigation. The only question for the judge was whether it would be unjust for Mr Ayton not to recover his costs in accordance with Part 36 having beaten the offer at trial.
3. The cases are unanimous is stating that the test of injustice is a high hurdle; and is essentially a value judgment for the judge to make. In circumstances in which the point of the proceedings is to recover the costs, I find it hard to see how it could be unjust* to deprive Mr Ayton of his costs. As the judge pointed out, it was always open to the Defendants to accept the Part 36 offer.
4. The appeal has no real prospect of success. Nor does it rise an important point of principle or practice.”
*This is the wording as in the original text.