WHEN SHOULD COSTS BE SUMMARILY ASSESSED OR SUBJECT TO DETAILED ASSESSMENT? HIGH COURT CONSIDERS THE ISSUES

In Brake & Anor v Guy & Ors (Costs) [2022] EWHC 2907 (Ch) HHJ Paul Matthews (sitting as a High Court Judge) considered an argument that the costs of an application should be subject to detailed assessment rather than summarily assessed.  The judge held that this was an appropriate case for summary assessment.

“… this is just the sort of case in which the court should assess the costs summarily. It concerns a short piece of satellite litigation, which might have been dealt with in court in a few minutes after judgment was given on the main application, and will cause a great deal more trouble and incur disproportionate costs if it is sent off for a detailed assessment”

THE CASE

There is long running litigation between the parties.  One of the parties “the Guy Parties” was successful in an application.   The successful party applied for their costs to be assessed.   The Brake parties objected to costs being summarily assessed.

THE JUDGMENT ON THE METHOD OF ASSESSMENT

Judgment had been given after a paper determination of the issues.  However the Brake parties stated that the costs schedule had been served late. The judge did not accept that argument.  Further, the fact that the paying parties were litigants in person was not, in itself, sufficient to make an order that there be a detailed assessment.

    1. As I have said, the application was successful, and the applicant Guy Parties have asked for an order that the claimants (“the Brakes”) pay their costs of that application. The Guy Parties also served a statement of costs dated 8 November 2022, showing a total of £9,551.98 (no VAT). They seek a summary assessment of the costs, but limited to £6,500. The Brakes do not resist a costs order in principle, but they submit that the costs should be subject to detailed rather than summary assessment, and they also challenge the amount of the costs claimed, as excessive.
Mode of assessment
    1. The first question is therefore whether I should order a detailed assessment, or whether I should assess them summarily. CPR PD 44 paragraph 9 relevantly provides:
“9.2. The general rule is that the court should make a summary assessment of the costs –

[ … ]

(b) at the conclusion of any other hearing, which has lasted not more than one day, in which case the order will deal with the costs of the application or matter to which the hearing related. If this hearing disposes of the claim, the order may deal with the costs of the whole claim,

unless there is good reason not to do so, for example where the paying party shows substantial grounds for disputing the sum claimed for costs that cannot be dealt with summarily”.
[ … ]
9.5(4). The statement of costs must be filed at court and copies of it must be served on any party against whom an order for payment of those costs is intended to be sought as soon as possible and in any event –

[ … ]

(b) for all other hearings, not less than 24 hours before the time fixed for the hearing.”

    1. The Brakes submit that I should not summarily assess the costs because the Guy Parties did not file or serve their statement of costs in accordance with paragraph 9.5(4), ie 24 hours before the hearing. They also rely on the decision of the Court of Appeal in Tomlinson v Radiocom Systems Ltd [2011] EWCA Civ 1832, where the court held that the judge had been wrong summarily to assess the costs in a case where the paying party was a litigant in person.
    1. The Guy Parties submit that paragraph 9.5(4) applies only where there is actually a hearing, and not to matters which are dealt with on paper. In any event, they say that the Brakes, having received the statement of costs on 8 November 2022, had until 10 November 2022 (approximately 48 hours) to comment on it, so that they have not been prejudiced by any failure to comply with that paragraph. They also seek to distinguish the decision in Tomlinson v Radiocom Systems Ltd, saying that it is “nothing like this case”.
Late filing and service of statement of costs
    1. So far as concerns the first point, it has become relatively common, since the coronavirus pandemic, for costs and other consequential applications to be dealt with on paper. As a general proposition, the courts have for procedural purposes usually sought to equate dealing with the matter on paper with a hearing in the conventional sense.
    1. But, of course, there will be procedural rules that which do not lend themselves to this process. Paragraph 9.2(b), dealing with the general rule as to when there should be a summary assessment, is an example of this. Dealing with a matter on paper cannot be regarded as a hearing that has a particular length. In the context of paragraph 9.5(4)(b), however, it seems to me that the judge cannot begin consideration of the paper application until he has received the written submissions on both sides, time-limited for lodging such submissions has expired. It is only then that the “hearing” can begin.
    1. In the present case, therefore, lodging the statement of costs some 48 hours before the reply submissions of the paying party are due amounts to compliance with that paragraph. Even if it did not, it is not uncommon for the court to proceed to a summary assessment even where less than 24 hours’ notice of the statement of costs has been given. The court has a discretion, which it exercises on a fact sensitive basis.
    1. In the present case, as the Guy Parties say, the Brakes had the statement of costs for 48 hours before their reply submissions were due to be lodged. I take account of the fact that Mrs Brake is unwell at present, but she has produced a set of entirely coherent submissions taking into account the costs schedule. Accordingly, the Brakes therefore would not have not suffered any material prejudice. In my judgment there is nothing in this objection.
Tomlinson v Radiocom Systems Ltd
    1. As for Tomlinson v Radiocom Systems Ltd, that was a case where the claimants, represented by counsel and solicitors, successfully applied for an interlocutory injunction, but failed on an application for summary judgment. They claimed costs amounting to some £68,000, of which £4750 were counsel’s fees, and the remainder were solicitors’ fees. The defendant was a litigant in person. Given that the application had taken less than a day, the judge at first instance summarily assessed the costs. However, he did not explain to the litigant in person that there was the option of detailed assessment, and neither did he question the claimant’s counsel on the costs schedule, although he reduced the cost claimed by 25% without giving any explanation.
    1. The Court of Appeal considered that the litigant in person had not understood that there was another option, and had been deprived of the possibility of asking for it. It also considered that there were a number of “remarkable items” in the costs schedule, and that in the circumstances the judge should have gone into the schedule of costs. As a result, the court set aside the judge’s order, and directed a detailed assessment, and a payment on account of costs.
    1. Although the Brakes are right to point out that the paying party in that case was a litigant in person, all the other significant elements of that case are different from the elements of this. The amount of costs claimed was much higher there than here (more than ten times), the Brakes are experienced litigants in person and know about the difference between summary and detailed assessment costs (indeed, that is precisely the point of their objection), and in their written submissions they have challenged various items in the statement costs and also the overall figure.
Conclusion on mode of assessment
  1. In my judgment, this is just the sort of case in which the court should assess the costs summarily. It concerns a short piece of satellite litigation, which might have been dealt with in court in a few minutes after judgment was given on the main application, and will cause a great deal more trouble and incur disproportionate costs if it is sent off for a detailed assessment. I will therefore make a summary assessment of the costs.