In the recent decision of Culliford & Anor –v- Thorpe  EWHC 2532 (Ch) HHJ Matthews held that it was possible for the Court to make an Order for an interim payment of costs after the date on which Judgment was given.
On 8th March 2018 HHJ Matthews handed down reserved Judgment in the Defendant’s favour. The Parties were unable to agree the Order to carry Judgment into effect, and a further Hearing was heard on 16th April 2018, which resulted in the following Order:
“Claimants should pay the Defendant’s costs of the claim, including the costs of this hearing, on the standard basis, to be assessed if not agreed”.
The Order did not however make any provision for an interim payment on account of costs, notwithstanding CPR r 44.2(8), which states that
“Where the court orders a party to pay costs subject to detailed assessment, it will order that party to pay a reasonable sum on account of costs, unless there is good reason not to do so”.
After the Order had been sealed, the Defendant raised the issue of a payment on account of costs with the Claimants’ solicitors in correspondence. The Claimants’ solicitors pointed out that the final Order made no provision for such a payment, and therefore the Court had no jurisdiction to Order one. The Defendant’s solicitors referred to r 44.2(8).
The Parties were unable to reach an agreement on an interim, and on 12th June 2018 the Defendant filed an Application with the Court. Both Parties served evidence in support of their positions in the form of witness statements and written submissions, and HHJ Matthews dealt with the matter on paper rather than incurring the expense of an oral Hearing.
HHJ Matthews found in favour of the Defendant, and found that the Court did have jurisdiction, and therefore, it was appropriate for an Order for an interim payment to be made:
“14. I begin with the question of jurisdiction. In my judgment, it is not the law that, once an order for costs has been made, drawn up and sealed, no further Application can be made to the court for an order for a payment of a sum on account of those costs. There is nothing in the rules which so requires, and there may be good reason why payment of the sum on account is not considered at the time the order was made…
Once it is accepted that the court has jurisdiction in principle to make an order for the payment sum on account of costs in an appropriate case, it is then simply a question of whether the court is minded to exercise that jurisdiction on the facts of the case, at the time when the court is asked to do so…”
HHJ Matthews came to this decision with reference to the terms of CPR r 44.2(8).
He went on to comment;
“22. There is no suggestion here that the Defendant deliberately decided not to ask for a payment on account. I might have raised the point myself at the hearing, and yet overlooked it. In my judgment, there is no good reason why the court should not make an order even at this stage for a payment on account of costs. It would still be of value to the Defendant, who has an order for costs in his favour and is being kept out of his money only because of the need for the detailed assessment to ascertain the exact sum.”
Costs of the Application
HHJ Matthews Ordered the Claimant to pay the Defendant’s costs of the Application, notwithstanding the fact that the Application arose out of the Defendant’s failure to request an interim at the conclusion of the Trial.
This is a very good result, and one that we at MRN will be relying on when making interim payment requests!
Although the findings on the costs of the Application point are only provisional at present, it is some welcome news that the Court sympathises with the Receiving Party who is out of pocket as a result of dealing with the claim.