COSTS, INTEREST ON COSTS AND COSTS ON COSTS: SEE HOW THEY GROW: £65,000 BECOMES £185,000

There is a short passage in the judgment of HHJ Paul Matthews (sitting as a High Court Judge) in  Blacklion Law LLP v Amira Nature Foods Ltd & Anor [2022] EWHC 1500 (Ch) that shows one of the dangers of cost disputes.

THE CASE

The claimant is a firm of solicitors it brought an action claiming costs under a retainer.  The primary judgment relates to the terms of one of the retainers.

 

THE EARLIER JUDGMENT

The judge set out the history of an earlier judgment.

  1. I should just say this about the claim under the general retainer. On 8 October 2020 the claimant applied for summary judgment in relation to the claims under both retainers. On 15 February 2021, Deputy Master Nurse gave summary judgment to the claimant on the claim under the general retainer, for a sum to be assessed, but dismissed the application so far as it related to the Avatar retainer. On 8 April 2022, Costs Judge Leonard assessed the sum due to the claimant as £65,000, together with £83,000 interest, making a total of £148,000, together with an award of costs of the assessment in the sum of £37,000. All of these sums were made payable by 28 April 2022. I have been told that none of them has been paid so far.

BREAKING THAT DOWN

 

  • The original bill was £65,000.
  • The interest was £83,000.
  • The costs of assessment were £37,000.

Making £185,000.

THE LESSON TO BE LEARNT…

There was much in dispute in this case.  However these figures indicate that wisdom of stopping interest running as soon as possible and avoiding assessment wherever possible.

 

In fact the claimant went on to establish it was entitled to a further £300,000 plus interest at 1.5% a month.  The trial was probably an even more expensive process.