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Court of Appeal decision in Henry-v-NGN

Posted: in by Michelle Barron.

Court of Appeal decision in Henry-v-NGN

​In reaching this decision to overturn the decision of the Senior Costs Judge, Lord Justice Moore-Bick stated that,“costs budgeting is not intended to derogate from the principle that the court will allow only costs as have been reasonably incurred and are proportionate to what is at stake; it is intended to identify the amount within which the proceedings should be capable of being conducted and within which the parties must strive to remain”. He went on further to say that budgets are, “intended to provide a form of control rather than a licence to conduct litigation in an unnecessarily expensive way. Equally, however, it may turn out for one reason or another that the proper conduct of the proceedings is more expensive than originally expected”......... In considering the premlinary issue Lord Justice Moore-Bick considered that: “First, because unless the court departs from the budget the appellant will not be able to recover the costs of the action. This alone would not be enough; if it were the scheme would be otiose, but it is an important factor to the extent that on examination the court is persuaded that the costs actually incurred were reasonable and, most importantly, proportionate to what was at stake in the litigation. Allied to that is the fact that the failure of the appellant’s solicitors to observe the requirements of the practice direction did not put the respondent at a significant disadvantage in terms of its ability to defend the claim not does it seem likely that it led to the incurring of costs that were unreasonable or disproportionate in amount. In other words, the objects which the practice direction sought to achieve were not undermined. In those circumstances a refusal to depart from the budget simply because the appellant had not complied with the practice direction would achieve nothing beyond penalising her. That might encourage other to be more assiduous in complying with the practice direction in the future, but to penalise the appellant for that reason alone would be unreasonable and disproportionate. That is all the more so in the context of the proceedings which were constantly changing in ways that, in the words of the judge below, could not be passed off as no more than a minor inconvenience. Then there is the fact that the appellant’s solicitors were not alone in failing to comply with the requirements of the practice direction”. Click here for the full judgment.

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