COST BITES 163: NO DEDUCTION FROM SUCCESSFUL RESPONDENT’S COSTS: A POINT OR TWO ABOUT “CLIENT’S” SUBMISSIONS

In  McAteer v Hat & Mitre & Ors (Re Consequential Matters) [2024] EWHC 1746 (Ch) Sir Anthony Mann (sitting as a High Court Judge) dismissed the unsuccessful appellant’s application that the respondent’s costs be reduced.  There were also some important observations about an advocate being used in circumstances where they had not prepared, and did not adopt, the written submissions placed before the court.

“The technique of a practitioner who submits a skeleton argument also providing submissions directly from the client without actually adopting them is not to be encouraged. The client has instructed lawyers, and they make submissions and will be expected either to adopt what the client wishes to say as part of those submissions, or not make them if they are submissions which the professional feels he/she cannot properly make. That is a valuable and proper filter which saves court time being wasted.”

THE CASE

The judge had earlier given judgment refusing the appellant’s appeal.  The judge was now considering issues in relation to costs.  The unsuccessful appellant argued that there should be a reduction of the respondent’s costs by 33%. This argument was put forward in a skeleton not prepared by the advocate appearing for the appellant.

THE JUDGMENT

The judge found that the issue that the claimant has “won” on was a relatively minor one. It made no difference to the outcome of the appeal. There was no evidence that the argument on this issue had led to any major expenditure as to costs.

1. 1. In my judgment I gave permission to appeal but dismissed the appeal. The respondents adopt the straightforward position that they have been successful, so costs should follow the event. The unsuccessful appellant does not seem to challenge the proposition that the respondents should have their costs (at least not according to counsel’s skeleton argument), but says that they should receive only 66% of the costs.

1. 1. The appellant’s position would seem to be based on the fact that Mr McAteer won on one issue, namely whether he was a contributory. The skeleton argument prepared for the appellant for the purposes of the consequential matters (signed by his solicitors Knights, not by Mr Ramel who appeared before me) asserts that “A very large amount of time and fees” were incurred on this issue, and that that justifies an issue based costs order which requires the reduction of 33%.

1. 1. Were I satisfied that a large amount of time and fees were involved in the point I might have been minded to make a reduction in respect of the liquidators’ unsuccessful case that Mr Mcateer was not a contributory. However, I am not so satisfied. It is merely made as an assertion, without any particularisation or evidence. In the absence of such material it is not at all convincing as an analysis. The point was a relatively short point of statutory construction involving a relatively quick trip through a number of sections with virtually no authorities involved. It involved a small part of a much bigger picture involving two agreements and other arguments. Not all successful points justify a reduction of costs, as authority well establishes, and the point made no difference to the result at the end of the day. No deduction is justified in respect of this point.

1. That means that the liquidators are entitled to the whole of their costs without any deduction in respect of that issue. Knights’ skeleton argument also rely on what it describes as the liquidators’ “repeatedly ‘moving the goalposts'”. It is not clear what it meant by that. It also refers to Mr McAteer’s conduct in applying to the court as a last resort when he had previously made “strenuous efforts” to find a resolution out of court. Again, the skeleton does not, itself, particularise that, but it records the request of Mr Mcateer himself to upload his own written submissions on the point, which in turn annex some historic correspondence, mainly from him without setting out many responses coming back.

1. 1. The technique of a practitioner who submits a skeleton argument also providing submissions directly from the client without actually adopting them is not to be encouraged. The client has instructed lawyers, and they make submissions and will be expected either to adopt what the client wishes to say as part of those submissions, or not make them if they are submissions which the professional feels he/she cannot properly make. That is a valuable and proper filter which saves court time being wasted. However on this occasion I record that I have read Mr McAteer’s submissions and the correspondence annexed. While I acknowledge that conduct in relation to proceedings, including taking steps to avoid them, would be capable of going to the question of the incidence of costs, the material submitted by Mr McAteer does not come close to raising some sort of viable point in that respect. For example, it demonstrates that he was making various proposals to the liquidators which included proposals to buy out the shareholders, but they do not, for example, demonstrate that he approached the shareholders and established that they would be willing to sell. In fact the evidence demonstrates that they would not, and he has not demonstrated that that is somehow an unreasonable position which means that in this litigation against the liquidators he should have to pay less than all the costs. Furthermore, the correspondence is not complete, so I do not know what the response to his proposals was and the reasons given. Partial correspondence in relation to a matter with a backgrounds as complex as the present matter does not get a conduct-based submission off the ground.

1. In those circumstances no issue-based, or conduct-based, deduction from the normal rule as to costs is justified and I do not make one