The High Court has refused to order costs on an appeal after the receiving party failed to apply for it by noon on the day before judgment is to be handed down, as required by the CPR.
Mr Richard Farnhill, sitting as a deputy High Court judge in Preston v Beaumont  EWHC 440 (Ch), said the failure to apply for relief for sanctions meant there was nothing he could do.
On 8 February, Mr Farnhill handed down his ruling dismissing the appellant’s appeal. The parties failed to agree costs and the judge was asked to conduct a summary assessment of the first respondent’s costs.
The appellant argued that, as no application for costs was made ahead of the handing down, paragraph 4.4 of PD 40E – which said an application for a consequential order must be made by noon the day before judgment was to be handed down – meant it was too late to do so now.
The first respondent made three linked arguments:
- Case law following the 1973 case of Re Barrell Enterprises says a judge remained seised of a case until the order disposing of it is drawn up and sealed, and so continues to have the power to make orders on consequential matters;
- When the court asked whether a hearing was required to address consequential matters, no time frame was specified for a response; and
- Despite paragraph 4.4, because the court retains jurisdiction, the failure to comply is not fatal and the court can still deal with the application.
Mr Farnhill said the “insurmountable difficulty” with this approach was that it was entirely inconsistent with the phrase ‘must be made’ in paragraph 4.4.
“It is mandatory. No specific sanction is set out in PD 40E, but given the mandatory language coupled with a clear time limit it seems to me clear that the effect of paragraph 4.4 is that no application can be made after that time.”
That meant this was properly a question of relief from sanctions, but as no application had been made for relief under CPR 3.9, he could not consider it.
“Even had such an application been made, it would have faced significant obstacles,” the judge continued.
“This was an obvious failure to comply with a clear rule in circumstances where compliance would have been straightforward.
“The argument that the first respondent’s lawyers did not make an application while they were seeking to agree the terms of the order goes nowhere. That should happen in every case but applications for costs by the successful party are so common as to be almost uniform.
“In any event the making of an application for costs would in no way have precluded the parties from continuing discussions.”
The second point, on the absence of a time frame for a hearing, did not advance the first respondent’s position, he went on, given that the relevant period was by reference to the time of the handing down.
Further, Re Barrell Enterprises did not apply here. “The fact that I may retain jurisdiction over some matters until the order is sealed does not create jurisdiction where none exists under the CPR in the first place.”
Re Barrell Enterprises did not change the fact that paragraph 4.4 was not complied with and there was no application for relief.
Mr Farnhill added that the fact the schedule of costs was served before the appeal hearing did not help – they may be part of the application for costs but were not the application itself.
He concluded: “Ultimately, the position is a straightforward one. The CPR makes limited provision for deemed costs orders, none of which apply here. To the contrary, the default position under CPR 44.10(1)(a) is that in the absence of specific provision there is no order as to costs.
“It was therefore incumbent on the first respondent if he wanted to seek his costs to make an application within the time permitted. He did not do so. If he wanted relief from sanctions he needed to explain that failure. Again, he has not done so.
“In the circumstances, costs were not sought in accordance with the relevant rules and it is too late to do so now. There will be no order as to costs in the appeal.”
The appellant represented himself. David Warner (instructed by Trethowans) for the first respondent.