“CIVIL LITIGATION IN THE MODERN ERA REQUIRES THE PARTIES TO BEHAVE REASONABLY”, PARTY PENALISED IN COSTS FOR NOT AGREEING TO AN EXTENSION OF TIME

In Invenia Technical Computing Corporation & Anor v Hudson [2024] EWHC 1481 (KB) Mr Justice Knowles held that a party that had refused a reasonable request for an extension of time should pay the costs of that application.

“… civil litigation in the modern era requires parties to behave reasonably and that may include, on occasion, agreeing to requests for short extensions of time by the other side even if they are not especially happy to do so. Fighting a war of attrition over every inch of ground is unreasonable and not the way civil litigation should be conducted. The extension sought in this case related to a minor sub-branch of the litigation. The extension sought was modest; good reasons had been put forward; there was no prejudice to the Applicant; and Master Gidden granted it in any event. Costs should therefore follow the event.”

THE CASE

The applicant sought an payment on account of  costs, following there being an order for costs made in his favour after an interlocutory hearing.  There were directions that the respondent should file witness evidence shortly before Christmas. The respondent sought an extension of time from the applicant.  The applicant refused to grant an extension unless the respondent agreed to the application being dealt with on paper.  The respondent, therefore, made an extension of time which was granted  (in fact for a longer period than that sought). The substantive application  for interim costs was then heard and the application dismissed. The judge then considered the costs of the respondent’s application for an extension of time.

THE JUDGMENT ON THIS ISSUE

The judge determined that the applicant had acted unreasonably in refusing to agree an extension of time and should pay the costs of the application.

1. 1. “I turn, finally, to the costs of Invenia’s January application for an extension of time. I can deal with this more briefly.

1. 1. The Applicant refused to agree to Invenia’s request for a modest extension of time for the service of its evidence in response to his application for a payment on account, the period in question having encompassed the Christmas/New Year break. They wrote in a letter dated 9 January 2024:

“4 As outlined in paragraph 5(1)(e) of Our Letter [of 13 December 2023], several members of our firm, as well as members of Invenia, including Invenia’s interim CEO from whom we take instructions, were on leave during the period from 25 December 2023 to 5 January 2024. This has impacted the Claimants’ ability to prepare their evidence in reply.

5. In light of the above, the Claimants request your agreement to a short seven- day extension for the filing of any evidence in reply to 4pm on Thursday, 18 January 2024.”

1. 1. As I said earlier, the Applicant refused to consent.

1. 1. That refusal necessitated an application to the court for an extension, which was granted by Master Gidden (in fact until later than the period sought by Invenia). In these circumstances I consider that the Applicant should pay Invenia’s costs of the application, for the following reasons.

1. 1. In Denton v TH White Ltd [2014] 1 WLR 3926, [43], the Court emphasised that an unreasonable refusal to agree to an extension of time should be punished in costs. I consider that the Applicant’s refusal was unreasonable. He said it was not, but I disagree. He was prepared to agree a short extension, but only if Invenia agreed his payment on account application be dealt with on the papers. They refused. They were entitled to do so, given what was at stake. Even if they had agreed, it is highly unlikely that any judge would have dealt with the application without a hearing, given the sums of money being claimed.

1. I understand that this litigation is hotly contested. But as I said during the hearing, civil litigation in the modern era requires parties to behave reasonably and that may include, on occasion, agreeing to requests for short extensions of time by the other side even if they are not especially happy to do so. Fighting a war of attrition over every inch of ground is unreasonable and not the way civil litigation should be conducted. The extension sought in this case related to a minor sub-branch of the litigation. The extension sought was modest; good reasons had been put forward; there was no prejudice to the Applicant; and Master Gidden granted it in any event. Costs should therefore follow the event.”