High Court overturns costs judge’s decision to strike out bill of costs

Party can recover in full any common costs which it would have reasonably incurred in any event, Rajah J rules

The High Court has overturned a decision by Costs Judge Rowley to strike out a bill of costs for non-compliance with an unless order requiring a breakdown of common costs with other defendants.

Mr Justice Rajah also held that a party could recover in full any common costs which it would have reasonably incurred in any event.

The underlying proceedings in Rollerteam Ltd v Siddiqi [2025] EWHC 612 (Ch) related to a long-running dispute over a family business, the Sherlock Holmes museum in Baker Street, London. Tariq Siddiqui had brought a £4m claim but it was mostly struck out and in 2019 he was ordered to pay the five defendants’ costs of various applications.

In December 2022, Judge Rowley required the defendants to commence detailed assessment by 15 February 2023. Only Rollerteam Ltd (‘D4’) did and served a bill totalling £82,432.

In April 2023, the judge made an unless order striking out the bill and assessing its costs at zero unless D4 served a revised bill which contained information specified in his order. This included a condition that, for any item of work was done jointly for the benefit of multiple defendants, it indicate the proportion done on behalf of D4.

It served a revised bill for £75,228 that was said to be on behalf of all defendants. In the notes, it accepted that the original version was “misconceived” as the original order was that Mr Siddiqui pay all of the defendants’ costs.

One firm of solicitors, RPC, represented them all and, as such, “there is no reasonable need to apportion work”, it said.

The notes said the sums claimed were for the benefit of all five defendants and 100% of the costs were incurred for the benefit of D4 in the same way they were for all the defendants. The exception was that, to accommodate the fact that some work was done for the benefit of the first defendant only in relation to one issue in the claim, certain profit costs were reduced by 10%.

On application by Mr Siddiqui, Judge Rowley struck out the bill for material non-compliance with his order.

He acknowledged that it was “a time-consuming task to draw the bill and then divide the entries so that only a proportion is claimed for each entry” – but this was the correct approach, rather than to allow a percentage recovery to be applied against all entries.

“The costs draftsman who produced the revised bill clearly thought they had found a short cut by seeking the costs on behalf of all of the defendants. In doing so, it appeared there would be no need to divide the time. But that approach overlooks all manner of questions of authority to pursue the costs on behalf of all of the defendants.

“At most, the bill has only been signed by the first defendant and the second defendant, for herself and for the fourth defendant. Moreover, it ignores the fact that only the fourth defendant is able to bring its costs for assessment within these proceedings – the other defendants having chosen not to serve notices of commencement.

“As such, the notes at the end of the narrative carry no weight in justifying the lack of division of the costs in this bill.”

Judge Rowley added: “The requirement [in my order] for the revised bill to reflect realistic sums that may be recoverable for one of five defendants was therefore no empty obligation. Having failed to deal with that obligation, it is entirely plain that the fourth defendant’s bill does not comply with my order.”

Allowing Rollerteam’s appeal, Rajah J held that the revised bill complied with the unless order.

While Judge Rowley was right to say the attempt to treat the bill as on behalf of all five defendants did not work, “it was not right to conclude that D4 had therefore effectively ignored his order ‘requiring division of the bill’. In fact, the information actually required by the order was provided, and whether the claim being made by D4 to 90%-100% was in the judge’s opinion realistic or unrealistic was neither here nor there.”

That was enough to allow the appeal but Rajah J went on to comment on the judge’s view that D4’s bill “failed to reflect realistic sums that may be recoverable” as the basis of his conclusion that his order had been breached.

Judge Rowley said most of the entries were for the benefit of other defendants as well but it was only if the work was solely for D4 that it would be recoverable in its entirety. He distinguished “non-divisible” costs, such as court fees.

Rajah J said this was not the right approach. There was an underlying principle that, subject to the indemnity principle, D4 could recover in full any common costs which it would have reasonably incurred in any event to defend itself, unless they were capable of identification and division.

“The real question is whether any of the common costs of defending the action by the defendants have been increased by issues relating to the defendants other than D4 or are solely attributable to those other defendants.”

Costs incurred to achieve the defendants’ joint objective at the 2019 hearing “are likely to be largely costs which would have been incurred whether there was one defendant or five defendants. In these circumstances, the judge’s reasoning as to why D4’s bill of costs was unrealistic was, in any event, flawed”.

Martyn Griffiths (instructed by Richard Slade and Partners) for the appellant. Mark James (Direct Access) for the respondent.

Photo: Jordan 1972. Public Domain, https://commons.wikimedia.org/w/index.php?curid=7912929