SANCTIONS FOR LATE FAILURE TO FILE A COSTS BUDGET DO NOT APPLY TO INCURRED COSTS: REPORT OF A COUNTY COURT DECISION
Recommended reading today is a useful report from PIC available here in relation to a decision in Hardy -v- Skeelis (4th March 2021, County Court at Stoke, HHJ Rawlings). The appeal decision confirms that the sanctions imposed for failing to file a costs budget timeously only apply to future costs, not incurred costs.
A party had filed a costs budget late. The District Judge decided that this meant the claimant was only able to recover court fees. The claimant argued that there was an entitlement to those costs incurred before the budget. The District Judge held that the sanction applied to all costs, both incurred and future costs.
THE CLAIMANT’S SUCCESSFUL APPEAL
The claimant successfully appealed to the Circuit Judge, HHJ Rawlings.
The claimant was able to show that in the Mitchell case ( Mitchell v News Group  EWCA Civ 1537,) both parties had agreed that the sanction only applied to future costs and not incurred costs.
They were able to show this because Leading Counsel instructed by the claimant appeared in the Mitchell case and, contrary to the view taken by the defendant and district judge, was able to supply the skeleton argument in the Mitchell case that showed that the Court of Appeal had proceeded on the assumption that only future costs were covered by the sanction.
A POINT THAT WAS ALREADY ON THIS BLOG
I posted notes of the arguments in the Court of Appeal in Mitchell on this blog in November 2013 those notes clearly state:-
The lack of any previously reported cases on this point is hardly surprising. The successful party’s representative would not normally wish to wash his dirty laundry in public, whilst the representative of the losing party would not want to publicise the decision for obvious reasons.
I myself successfully secured a decision from the Bristol County Court recovering pre Budget costs for a Claimant 18 months ago when at a previous firm. I inherited the file from a former colleague, so I am not tainted with having the failure of not filed a Budget in the first place.
Nevertheless the publication of Hardy v. Skeelis is welcome. And good law.