The defendant costs specialists

Posts made in July, 2014

Mitchell vs Denton – relief from sanctions

By on Jul 11, 2014 | 3 comments

The guidance given by the Court of Appeal in Mitchell was that in relation to non-compliance with the relevant rule, practice direction or court order: “If this can properly be regarded as trivial, the court will usually grant relief provided that an application is made promptly. … the court will usually grant relief if there has been no more than an insignificant failure to comply with an order” The Court recognised: “We acknowledge that even the question of whether a default is insignificant may give rise to dispute and therefore to contested applications. But that possibility cannot be entirely excluded from any regime which does not impose rigid rules from which no departure, however minor, is permitted.” The Court of Appeal’s new guidance in Denton is that: “we think it would be preferable if in future the focus of the enquiry at the first stage should not be on whether the breach has been trivial. Rather, it should be on whether the breach has been serious or significant.” The Court recognised that “seriousness and significance” is perhaps no more clear-cut than “trivial”: “We recognise that the concepts of seriousness and significance are not hard-edged and that there are degrees of seriousness and significance, but we hope that, assisted by the guidance given in this decision and its application in individual cases over time, courts will deal with these applications in a consistent manner.” The new test to apply is: “If a judge concludes that a breach is not serious or significant, then relief from sanctions will usually be granted” There is clearly a range of significance in terms of non-compliance with rules, practice directions or court orders. At one end of the spectrum are “trivial”/”insignificant” ones. At the other are “serious or significant” ones. “Trivial”/”insignificant” ones might occupy the bottom 10-20% of the spectrum in terms of significance. “Serious or significant” ones might occupy the top 10-20%. There is therefore a world of difference between the Mitchell test where 10-20% of breaches might be saved by the first stage test (being categorised as “trivial” – everything at the bottom of the spectrum) and the Denton test which saves 80-90% of breaches which do not fall into the top 10-20%...

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Post-Mitchell test for relief from sanctions

By on Jul 7, 2014 | 7 comments

Recent editions of Costs Law Reports have been so full of cases concerning applications for relief from sanctions they could have been renamed the Relief from Sanctions Law Reports. Sadly, all those trees have been cut down in vain. The Court of Appeal, giving their eagerly awaited post-Mitchell decision on the correct test to apply said: “We hope that what follows will avoid the need in future to resort to the earlier authorities.” The press has recently reported a decision of the first-tier tax tribunal as to whether Snowballs are cakes or confectionery, and therefore zero rated for VAT. As to whether the Court of Appeal’s new guidance is a cake or a confection, the answer is that it is a fudge. They were not prepared to state the Mitchell test was wrong but neither were they willing to confirm it was correct. Apparently, the fault lies with other judges being silly enough to believe that the Mitchell test meant what it said. We now have a different test. The Court of Appeal optimistically hopes the new test will reduce the amount of satellite litigation generated by Mitchell. It appears the Court has forgotten what was said in Mitchell: “We share the judge’s desire to discourage satellite litigation, but that is not a good reason for adopting a more relaxed approach to the enforcement of compliance with rules, practice directions and orders. In our view, once it is well understood that the courts will adopt a firm line on enforcement, litigation will be conducted in a more disciplined way and there should be fewer applications under CPR 3.9. In other words, once the new culture becomes accepted, there should be less satellite litigation, not more.” It now appears the courts are meant to take a less firm line. Quite how this will lead to less satellite litigation remains a mystery, particularly given the new test creates far more uncertainty as to which way a court may go on an application for relief. Costs Law Reports will no doubt be full over the next year or two with new decisions attempting to interpret the new...

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Legal costs quiz

By on Jul 4, 2014 | 3 comments

Are you a true legal costs geek, just take a passing interest in the subject or fall firmly into the costs monkey category? Take our quick test to find out: Question 1 – Do you prefer to read: A. Costs Law Reports B. The cost law case summaries on Litigation Futures C. OK! magazine Question 2 – Do you think the indemnity principle is: A. More important than life itself B. Probably an outdated legal concept that has outlived its usefulness C. Uh? Question 3 – Do you dream of: A. Becoming a costs judge B. Retiring to the country and spending your spare time fishing C. Moving to California and becoming a porn star Question 4 – The impact of Jackson will be: A. A surge of inevitable satellite litigation around costs. Happy days are here again. B. Will bring some much needed proportionality back into civil costs but has some worrying implications for access to justice in some areas. C. Bad, although there’s no denying Billie Jean is a dancefloor classic. Question 5 – What is the best way to spend a Saturday morning: A. Attending the panel session of the Association of Costs Lawyer’s Annual Conference. B. Browsing around flea markets looking for a bargain. C. Still drunk from the night before. Question 6 – What do you think of the Costs Wars: A. They were a necessary evil to provide the required case law on the interpretation of the Access to Justice Act 1999 B. They were an unwelcome distraction in the litigation process generating unnecessary satellite litigation C. Did George Lucas direct that one? Question 7 – At night do you like to: A. Curl up in an armchair with a copy of Friston’s Civil Costs – Law and Practice B. Curl up on the sofa and watch a scary movie C. Curl up in bed with a hooker How did you answer? Mainly As – Congratulations. You are a true costs geek. Admittedly, you probably have no friends or social life, but never let it be said that anyone knows more than you about the indemnity principle. Mainly Bs – You would probably pass in public for a relatively well adjusted and normal...

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