Harmans Costs Brief - April 2014

It's all go at Harmans in April!  We've made an important acquisition in Lauben Services, our costs seminar is fully booked and our team is in training for the London Legal Walk next month.  As usual, we still aim to bring you all the latest news and developments in Costs along with expert analysis. Hope you enjoy the latest issue of Costs Brief.
Many thanks, Harmans Costs 
For even more news and comment visit our website

Partner Jim Knight asks what might the outcome have been had Mitchell
been appealed to the Supreme Court?


Mitchell was no doubt a controversial decision but for whatever reason it was not appealed to the Supreme Court. Had it been, the final outcome may well have been far less draconian.


As recently as 3 March 2014, the Judicial Committee of the Privy Council heard the appeal in Real Time Systems Ltd -v- Renraw & Others [2014] UKPC 6 which concerned concerning a decision made by the Court of Appeal of Trinidad & Tobago which overturned a Judge's strike out order.


The Privy Council upheld the decision indicating that the correct route would have been to apply for an unless order rather than an order to strike out the claim. The significance of this Privy Council decision is that it was made by three Supreme Court Judges (Lords Mance, Clarke and Sumption) who found that there was no reason why the Court, faced with an application to strike out, should not conclude that the justice of the particular case "militates against this nuclear option", and that the appropriate course instead would be to order a Claimant to supply further details, or serve an amended statement of case including such details, within a further specified period.


When delivering this judgment Lord Mance commented that " would again be very strange if, by choosing only to apply for the more radical than the more moderate remedy, a Defendant could force the Court's hand, and deprive it of the option to arrive at a more proportionate solution." Words of wisdom indeed but cold comfort perhaps for Mr Mitchell and his legal representatives!

Precedent H to be revised in 69th Update to CPR

The form of the statement of truth verifying a costs budget is to be revised in the latest update to the Civil Procedure Rules.

It is important to note that the revision to the statement of truth is to come into force on 22 April 2014 and not 6 April 2014 as previously stated.

The new statement of truth that comes into force of 22 April 2014 states “This budget is a fair and accurate statement of incurred and estimated costs which it would be reasonable and proportionate for my client to incur in this litigation.”

The current statement of truth (Paragraph 2.2A of Practice Direction 22) states “The costs stated to have been incurred do not exceed the costs which my client is liable to pay in respect of such work. The future costs stated in this budget are a proper estimate of the reasonable and proportionate costs which my client will incur in this litigation.”

Please make sure that the new statement of truth is utilised for all costs budgets prepared and/or served post 22 April 2014.

The new stricter approach to applications for relief from sanction
reaches the SCCO

The decision of the Court of Appeal in Mitchell v News Group Newspapers Ltd  [2013] EWCA Civ 1526 was intended to send out a clear message to the legal profession that applications for relief from sanction would be granted only where (very) good reason for failure to comply with a rule,  direction or order of the Court could be shown.

Mitchell is not, it appears, popular with Judges who are expected to enforce the guidance notwithstanding their reservations as to the draconian effect of refusing relief from sanction even in cases where the “failure” appears to be minimal with little, if any, prejudice suffered by the opponent.

Those dealing with costs on a regular basis pondered as to what, if any, relevance Mitchell would have in respect of costs claims given that historically costs have been treated with a great deal of elasticity when it came to procedural matters and a common sense approach to costs always prevailed… well at least since the cessation of the so called costs wars arising from technical challenges to Conditional Fee Agreements that is.

Costs Judge Master Gordon-Saker was required to give early consideration at the Supreme Courts Costs Office to an application for relief from sanction in the matter of Andrew Harrison and Elaine Harrison and Black Horse Limited– [2013] EWHC B28 (Costs).

This had been a long running dispute arising from the Claimant’s allegation of mis-selling of payment protection insurance (PPI) by the Defendant as part of loan agreements between 2003 and 2006.

The claim began in the County Court and following trial the Claim was dismissed with costs to be paid to the Defendant.

The matter was the subject of an appeal (appeal one) to the Birmingham County Court before being transferred to the Manchester Mercantile Court whereat His Honour Judge Waksman QC who was sitting as a Judge of the High Court dismissed the appeak again with costs.

To read the rest of Gary Knight's article click here.

Harmans Costs consolidate with Lauben deal
Harmans Costs are pleased to announce the acquisition of Lauben Legal Services and appointment of Jim Lines as Partner.

Chesham-based Lauben Legal Services is a costs drafting business set up in 1994 by Costs Lawyer Jim Lines.  Lauben deal with all areas of Civil Costs – clinical negligence, personal injury, dispute resolution, Court of Protection and publicly funded costs, particularly children and family matters and including high costs case plans.  Lauben provides a full costs service to its clients, most of whom have been using their services for over 15 years and some since Lauben’s inception.

Matthew Harman, Partner, said, “We are delighted to complete the Lauben deal and are looking forward to working alongside Jim and his consultants.  Harmans are very much focused on strengthening our already significant costs experience this year and the acquisition of Lauben, as well as the recent addition of Costs Lawyer Mark Brown to the Chelmsford office, will certainly help us achieve our targets in 2014.”

Working out of Harmans’ Aylesbury office Jim and his consultants will be working alongside Partners Matthew Harman, Mary Collins, John Moss and Steve Jones and will add weight to Harmans’ growing client base.

Only last month Harmans welcomed Mark Brown to the Harmans teams who brings 17 years of costing experience to their Chelmsford office.  The latest acquisition of Lauben shows their continued intent to strengthen the company and add even more expertise across their costing team.
Matthew Harman continued with his speaker bookings on 2 April in London at the Westminster Legal Policy Forum keynote seminar on civil justice and the Jackson reforms.

Matthew, a former chairman of the Association of Costs Lawyers, said the Mitchell approach of “treating human error as a capital offence” had created a “culture of fear” among the practitioners who instructed him.

It was problematic because “for litigation to proceed successfully, there has to be an element of common sense pragmatism, a little bit of give and take between competing lawyers”.

He asked: “One of the recurring themes in the Jackson report is proportionality. Where is the proportionality in the sanctions which have been applied in the myriad of cases since Mitchell?”  Interesting stuff, next up is our own costs seminar at the Law Society on 11 April - more below...

Legal Costs Update by Partner Gary Knight

The ripples caused by the Mitchell decision continue to spread out across the 2014 legal landscape. The following are just some of the highlights from a busy February and March.

M A Lloyd & Sons Ltd (T/A KPM Marine) –v- PPC International Ltd (T/A Professional Powercraft)  (2014) – QBD – Turner J -20/01/14 [2014] EWHC 41 (QB)
In this matter the defendant applied for an extension of time for the provision of a witness statement.
In the proceedings an order had been made for the claimant to provide a statement together with a skeleton argument by 25 October 2013 on matters of law in support of the submission that the defendant was “legally extinct” with no entitlement to litigate with the defendant to provide a statement in reply by December 2013. Absent the claimant’s statement or skeleton the defendant issued its application but thereafter agreed to the claimant’s proposed revised timetable. The claimant did not attend the defendant’s application hearing but produced a draft statement setting out difficulties encountered obtaining documents.

At the hearing Turner J found that it was (i) abundantly clear that the claimant should have advised the court of its alleged inability to provide evidence before the order had been made,(ii) in the event that the claimant became aware that it was in difficulty after the order had been made the claimant ought to have applied for an extension of time before the deadline for compliance had passed, (iii) the claimant ought to have applied promptly for specific disclosure rather than simply providing a “wish list” of documents in the body of a statement.

The judge stated that as the matter stood the claimant was precluded from calling at trial any intended witness in respect of the issues that had been identified in the order unless the claimant could persuade the court to grant relief from sanction. The judge referring to Mitchell was entirely satisfied that there was no prospects of relief being granted further referencing the robust approach to late service of statements in Durran  and in Karbhari.

The fact that the defendant had agreed to the claimant’s proposed revised timetable did not assist the claimant, the defendant’s response to the claimant’s default being described by the judge as “unduly timid” and the court declined to endorse the revised time table stating the proper approach was to make an order debarring the claimant from raising any issue at trial relating either to the existence of the Defendant or its entitlement to litigate in the UK. The claimant’s decision not to attend had, in the view of the judge, resulted in a disproportionate amount of court time being taken up, the judge cautioned that a party could not simply assume it could absent itself confident in the assumption that r23.11 afforded a comfortable fallback position if the court’s order was not to its liking.

Click here for Gary's full update and further significant cases.

Our costs seminars are always popular and word certainly seems to have got out as our latest seminar due to take place on Friday 11 April 2014 at The Law Society in London was fully booked in record time!

Partners Matthew Harman and Steve Jones will be focusing on developments 12 months post Jackson as well as Relief from Sanctions.  A waiting list is now in operation, please email vikki.knight@harmanscosts if you would like to be added to it.

We will be circulating notes after the event for those who missed out, keep an eye on the website and of course the next edition of Costs Brief.



Follow us on Twitter @HarmansCosts for the latest industry comment.  We also hold regular Q&A sessions when you can tweet or DM our legal costs experts a question - look out for details of our next one coming soon.
Our intrepid team are now in training for this year's London Legal Walk (or in Gary's case jog) which takes place on Monday 19 May. It's the 10th anniversary of this great event and it's for a very worthwhile cause. We'd be delighted if you could sponsor us.  You can click the banner below for more information on the event, why not enter a team too and join us...
We hope you enjoyed this month's Costs Brief,
please feel free to circulate it to your colleagues.
Look out for our next edition coming soon with news of
an exciting digital development for Harmans...
Forward to Friend
Read Later
Copyright © 2014 Harmans Costs, All rights reserved.
unsubscribe from this list    update subscription preferences 

Email Marketing Powered by Mailchimp