Recorder hits out at “staggering” spend on very modest claim
A judge has halved a receiving party’s budgeted costs on the basis of excessive hourly rates in a case where he described the level of costs claimed as “staggering”.
Recorder Benjamin Wood, sitting at Central London County Court, was critical of the parties for spending “around 100 times more on legal fees than the claim is actually worth”.
The precise nature of the dispute in O’Sullivan v Trading 212 UK Ltd [2026] EWCC 32 was not clear from the ruling but related to the defendant shutting down the claimant’s account.
The defendant was the successful party and in this ruling the recorder undertook a summary assessment of the costs. The claim “only ever appears to have been worth a few thousand pounds, when properly analysed” and was a straightforward matter to resolve.
“It may be a case that was (and remains) of considerable importance to the parties themselves, but it not a case of public importance and it is not (or certainly ought not to have been) a case where either party regarded his/its reputation as being at stake.”
“In making the points above, I do not for one second wish to suggest that the defendant has covered itself in glory. It has not.”
The case was budgeted but the figures were increased at the pre-trial review, while late disclosure during the course of the trial meant that by the time judgment was handed down, “the parties had a little over £482,000 in costs on the table, between them”.
Recorder Wood said: “With an exhortation from me about proportionality and what I had intended to be a very clear message about the overall level of costs, the parties have not stopped spending since then…
“Adding (just) those figures, the overall costs on the table now stand at over £500,000. Saying it in different words, the parties have spent over half a million pounds between them trying to get the court to decide whether the defendant owes the claimant in the region of £5,000. Or, for those who prefer multiples, the parties have spent around 100 times more on legal fees than the claim is actually worth.”
In fact, the parties’ calculations of their actual costs showed the claimant had spent £246,400 and the defendant £452,400. This was “staggering”.
When it came to costs, the judge recounted that much of the parties’ focus was on each other’s conduct but he decided that it would not be just “to start doing a fine analysis of the impact of particular elements of conduct that might be said to have had an impact on the costs”.
There was one exception to this: the defendant’s late disclosure of Slack messages, which led to the case “taking up a great deal more court time and the incurring of a great deal more expense on both sides”. Though it did not change the outcome of the litigation or the parties’ approach to it, he awarded the claimant his costs of consequent upon the late disclosure on the standard basis.
Looking at the defendant’s budget, Recorder Wood said the hourly rates of its more senior solicitors were “significantly higher than any of the guideline rates, and higher even than the guideline rates for very heavy commercial work conducted by centrally based London firms”.
This was a “good reason” to depart from the approved budgets. “I cannot see any justification for the defendant being entitled to recover its solicitors’ time at the hourly rates claimed. This was a claim that started in Hull (and was case managed there) and was always of modest value.
“Even though the defendant is based in the City of London, and is a financial organisation, this case did not justify the involvement of ‘London 1’ solicitors. I am far from convinced that it required London-based solicitors at all, given how many firms operate outside London, including those with financial services specialisms (if that was required).
“If that is required for the incurred (and not budgeted) costs, then it would, applying RNB, be a good reason to depart from the approved budgets in order to apply the same reductions.”
He reached the same outcome from first principles, given the nature of the case. “Put shortly, I take the view that the judge who made the costs management order did so on a basis that has turned out to be completely wrong.
“Had the judge known what I know now, it is vanishingly unlikely that this case would have been allocated to the multi-track and it is all but inconceivable that the parties would have been allotted 3.5 days of court time for the trial.
“Even if it had been treated as a multi-track trial, the shorter time estimate ought to have led the court to approach the cost budgeting exercise in a very different way. The parties would have been expected to cut their cloth much better to reflect the pleaded value of the claim.”
“Second, the effect of this decision is not to ignore the approved budget altogether, but to permit departure from it… Third, and in the particular circumstances of this case, it seems rather more appropriate to evaluate the ways in which the paying party has generated additional work at the end of the claim, rather than at the case management stage.
He went on to halve the £54,000 claimed by the claimant for disclosure and award just a quarter of the £60,000 the defendant sought for a strike-out application which was not subject to budgeting.
The budgeted costs sought by the defendant were £225,000, made up of £165,000 in solicitors’ costs and £60,000 in counsel’s fees. Recorder Wood assessed these at £113,750, which he considered “a reasonable and proportionate amount”.
Set off against the disclosure costs, the claimant was ordered to pay £96,350.
The claimant appeared in person (with written submissions having previously been settled by Anthony Metzer KC and George Symes). Anna Greenley (instructed by Winckworth Sherwood) for the defendant.