Haigh, R (On the Application Of) v City Of Westminster Magistrates' Court

In these proceedings for judicial review, the Claimant challenges the decision of District Judge Ikram, dated 30^th September, 2015 (“the Decision”), ordering him to pay £230,446.14 to the Interested Parties (“IPs”), by way of costs incurred in respect of the Claimant’s application for summonses against them.

The order was made pursuant to s.19 of the Prosecution of Offences Act 1985 (“the Act”). S.19 of the Act provides that the Court may make an order for costs where:

“ …it is satisfied that one party to criminal proceedings has incurred costs as a result of an unnecessary or improper act or omission by, or on behalf of another party to the proceedings. ”

The wording of s.19 is echoed in Regulation 3 of the Costs in Criminal Cases (General) Regulations 1986 (SI 1986/1335) (“the 1986 Regulations”). Regulation 3 is, in turn, complemented by what is now Rule 45 of the Criminal Procedure Rules (formerly Rule 76) (“the Crim PR”).

Part 45 provides, inter alia, that in deciding what, if any, order to make about costs, the court must have regard to all the circumstances, including the conduct of all the parties: r.45.2(3). Subject to the Court’s broad discretion to reduce the amount awarded, where the Court makes an order for the payment of costs, the “general rule” (r.45.2(6)(a)) is that it must be for an amount that is sufficient reasonably to compensate the recipient for costs:

“ (i) actually, reasonably and properly incurred, and

(ii)

reasonable in amount….”

On an assessment of the amount of costs (r.45.2(7)), relevant factors include:

“ (a) the conduct of all the parties;

(b)

the particular complexity of the matter or the difficulty or novelty of the questions raised;

(c)

the skill, effort, specialised knowledge and responsibility involved;

(d)

the time spent on the case;”

Where an order is made for costs to be paid resulting from “unnecessary or improper act etc.” (r.45.8), reasons must be given and the court must assess the amount itself: r.45.8 (7) and (8).

Limited permission to bring these proceedings was granted by Blake J, on the papers, by order dated 8^th February, 2016 (“the 8^th February order”). That permission was widened following an oral hearing before Lord Thomas CJ and Singh J on 12^th July, 2016 (“the 12^th July order”) – though the 12^th July order was itself careful to limit the scope of the issues advanced before us.

The Claimant submits that the Decision was unlawful or irrational in that:

For present purposes, the factual background may be shortly summarised. The Claimant is a British national who, at the material times, was detained in prison in Dubai from May 2014. He had been arrested on suspicion of financial irregularities. In the event, he was convicted of fraud in August 2015 and was due to be released in November 2015.

The Claimant had been employed as Deputy CEO of GFH Capital Ltd (“GFH”), an Islamic investment house in Dubai. The First IP was the CEO of GFH; the Second IP was a senior executive of GFH; the Third IP was, at the material times, a solicitor and partner in the Dubai office of a US law firm, then acting for GFH.

On the 26^th May, 2014, GFH issued proceedings in the Dubai International Financial Centre Courts (“DIFC”) alleging, in a nutshell, that the Claimant procured the issue of false invoices so as to divert to his own accounts some US$5 million, in breach of his fiduciary duties. A freezing order was obtained.

The Claimant alleges that the IPs conspired to defraud him and that their conduct further constituted the criminal offence of human trafficking: in essence, the Claimant alleges that between the 1^st April, 2014 and the 23^rd March, 2015, the Interested Parties lured him to Dubai to have him arrested under false pretences.

Notwithstanding these allegations, the Claimant did not go to the law enforcement authorities or agencies in this country. Instead, he applied as a private prosecutor, to Westminster magistrates’ court, seeking to lay an information to procure warrants, alternatively summonses, in order to commence criminal proceedings in this jurisdiction, initially against the First and Second IPs and, subsequently, against the Third IP as well. Various versions of the Claimant’s application were produced, between 13^th January and 27^th March, 2015.

By order of DJ Roscoe, dated 11^th February, 2015, the Claimant was required to put the IPs on notice of his application.

At a hearing on 9^th April, 2015, the Claimant’s application for summonses in respect of the IPs came before DJ Ikram. At that hearing, leading counsel for the Claimant stated that the intention was to commence criminal proceedings with the aims of (1) securing convictions against the Interested Parties; and (2) securing the Claimant’s release from custody in Dubai.

The Judge indicated, by way of a preliminary view, that he was not minded to issue the summonses. The hearing was adjourned, part-heard, to a date to be fixed.

By letter dated 20^th April, 2015 (“the 20^th April letter”), the Claimant’s then solicitors wrote to the IPs, stating that they would be bringing the matter to the attention of “criminal law enforcement authorities”. It was therefore their intention to submit to DJ Ikram that “… justice for our client against the Alleged Conspirators would be better achieved if we adjourn our request for summonses pending the Investigations and decisions of the authorities.” The letter went on to say that they had argued “since January” that the matter was urgent and they had considered “that an application for summonses or warrants was likely to be the most expeditious way to bring this matter before a jury”. That “no longer applies” and they now believed that the fastest way to bring the matter before a jury was via the law enforcement agencies. A video-link connection to the Claimant was impracticable and risked compromising the Claimant’s safety. The letter continued as follows:

“ The District Judge [i.e., DJ Ikram] has raised queries as to the motives of the Prosecutor [i.e., the Claimant] in bringing the request for summonses but not because the accusations he makes are ill-founded. It is unlikely therefore that the matter will be resolved for many weeks, and, if he were to issue summonses, we have little doubt that you would seek to challenge such a decision by way of judicial review whilst the conspiracy is continued against our client.”

The letter proceeded to assert that the Claimant now had a much more developed evidential case, to which there was “no serious legal answer”. Additionally, a further reason for the new approach was that they had received “further significant evidential material” since the 9^th April, which they did not wish to disclose at that stage – as the enforcement agencies would be asked to make appropriate investigations.

By his Ruling dated 12^th June, 2015 (“the 12^th June Ruling”), DJ Ikram dismissed the Claimant’s application for summonses to be issued. As the Judge observed, he had initially been invited to treat the application as “withdrawn”. The Judge said this:

“ The case is part-heard. On the basis that the Applicant does not pursue the application and does not invite the issue of summons in this case and upon the Applicant not objecting to the matter being dismissed rather than marked ‘withdrawn’, I dismiss the application for summonses to be issued in this case.”

The Judge adjourned the question of costs. He was invited by all concerned to consider the application for costs on paper and without a hearing. As will be seen that is what he proceeded to do, despite a subsequent application by the Claimant to adjourn the resolution of that issue.

In the meantime, the civil litigation was proceeding in the DIFC. On the 24^th March, 2015, Sir David Steel made a Ruling (“the DIFC ruling”) in respect of an application by the Claimant to vary the freezing order, of which mention has already been made. Much of this ruling is concerned with the terms of the freezing order, together with the variations contended for and is of no relevance for present purposes.

However, at [13] – [14], Sir David Steel traced the history of the substantive proceedings. He recorded the Claimant’s acceptance in the Dubai proceedings that GFH had a good arguable case on the merits. The Claimant’s position was that, while accepting that the invoices were false, his assertion was that someone else had forged his signature upon them. The Claimant further accepted that the monies were received in his bank accounts but he contended that they were intended for him, in order to reimburse him for expenses incurred in the course of his employment by way of reconciliation and/or in respect of his salary and bonus entitlement. He further submitted that there was a significant shortfall in respect of commissions due to him.

Against this background, Sir David Steel said this, at [32] – [33]:

“32.

….on 12 January 2015…..the Defendant [i.e., the Claimant in these proceedings] instigated a private prosecution against Mr Patel, who is a witness in this case, and Mr Al Rayes alleging a conspiracy to defraud on essentially the same grounds as the civil claim in the Queen’s Bench Division; that is to say, the alleged misrepresentation which induced him to come to Dubai. The court in London is invited to proceed on the basis and this is of some note that the claim being advanced in these proceedings is fabricated. Against that background, the Defendant has applied for warrants of arrest of Mr Patel and Mr Al Rayes, an application being due to be heard before a district judge on 9 April.

33.

The Defendant is represented by leading counsel. There is a very substantial Witness Statement from the Defendant which forms part of the papers. There is no indication of any funding difficulties or lack of assets, preventing the private prosecution from proceeding. The basis of the complaint is the suggestion that the claim here has been fabricated. This is pretty startling. No such allegation is made in the Defence to the effect that the claim is bogus and dishonest. To the contrary, the Defendant accepts in these proceedings that the Claimant has a good arguable case. It seems to me wholly inappropriate that there should be this collateral attack on its own admission.” (Italics added.)

As already noted, DJ Ikram’s Decision was dated 30^th September, 2015. It was based on the written submissions made by all parties and without a formal hearing.

At [11] and following, the Judge considered whether there had been “an unnecessary or improper act or omission” (within s.19 of the Act). After tracing the history, DJ Ikram made these observations:

“14.

…the issue of bringing the matters to the attention of the law enforcement authorities was raised by this court at the very first hearing. He [i.e., the Claimant] chose, initially at least, not to ….bring the matters to the attention of the law enforcement authorities. I was told that there was urgency in bringing the applications before this court and yet, of his own volition, the Applicant changed course and did just that and withdrew the proceedings, deferring to them.

15.

Whilst I am not, in any sense, bound by the views of Sir David Steel sitting as a Judge of the DIFC in Dubai, he has been over a period, dealing with various applications between the parties and he considered the applications before this court as ‘wholly inappropriate’ (judgment dated 24 March 2015).

16.

The Applicant remains in custody in Dubai but has been legally represented throughout and launched these applications in the full knowledge that he may well be doing so from a prison cell. He has been legally represented throughout and able to make representations and responses through them.”

The Judge recorded [at [17]) that, although he had been invited to deal with costs on the basis of written submissions, he had subsequently been asked to postpone the resolution of the issue of costs until the Claimant was back in this country, so that he could justify the decision to apply for the summonses. The application for costs dealt with “the very issue” which the Court had not resolved, due to the Claimant’s decision to withdraw his application (for the summonses): at [18]. The Judge declined (at [19]) to further adjourn the matter; the Claimant had been legally represented throughout and had had “every opportunity” to deal with the issue.

After careful consideration (at [20]), the Judge was persuaded that the IPs had satisfied him of the “improper or unnecessary act”. The Judge’s conclusion was expressed in these terms (at [21]):

“ The Applicant had choices at the outset and he chose to seek the issue of summonses on a private prosecution whilst in custody in Dubai facing proceedings there. He did so knowing that he would have to conduct proceedings with the possibility that he would remain in custody there. He could have instead gone to law enforcement agencies but chose not to (though later changed his mind). I am of the clear view that it was wholly improper to launch these proceedings and that ….section 19 allows the making of an order against him as party.”

The Judge concluded (at [22]), that costs had been incurred by the IPs. These were to be assessed on private client rather than legal aid rates (at [23]). The IPs:

“ … faced the prospect of reputational damage and the possibility of warrants of arrest being issued against them. The consequences for them would have been serious. District Judge Roscoe directed that they be given notice of the proceedings and they, as they are entitled, have engaged and been a party in response.”

Having considered the bill from both firms of solicitors involved – the First and Second IPs have been represented jointly by one firm of solicitors (Bryan Cave) and the Third IP by another (Peters & Peters) – the Judge turned to the question of the quantum of costs. At first sight, the sums sought seemed large (at [24]). The guidance which the Judge drew from authority was that the assessment must be of an amount that reasonably compensated the IPs for costs “actually, reasonably and properly incurred” as a result of the unnecessary or improper act or omission identified. The requirement of reasonableness incorporated a degree of proportionality. The statutory scheme envisaged a “summary assessment, adopting a broadbrush approach”.

As to proportionality, the Judge took into account the fact that the Claimant had himself engaged a “formidable team” of well-known solicitors, leading and junior counsel. The IPs were entitled to “equality of arms”, bearing in mind the seriousness of the matter for them. The Judge was not persuaded that the formidable legal teams instructed by the IPs constituted a “disproportionate response”.

After considering the bill of costs and the fee note of leading counsel for the Claimant, the Judge concluded as follows:

“ Bearing in mind ‘equality of arms’ and the consequences to the Respondents [i.e., the IPs], the bills for the Respondents do not seem at all remarkable bearing in mind they also include, of course, solicitors’ costs, nor disproportionate to the costs borne by the Applicant to his own legal team. I am [of] the view that they are, in all the circumstances, reasonable.

25.

I therefore order the Applicant pay the costs of £121,500 to the First and Second Respondents and the sum of £108,946.14 to the Third Respondent. ”

I turn to the Grounds of challenge advanced.

(1) The scope of this issue: As appears from [6] and [7] of the Judgment of Lord Thomas CJ on 12^th July, 2016 (underpinning the 12^th July order), two questions arise for our consideration:

(2) The meaning of “improper” in the context of s.19 of the Act: In the event, there was no dispute as to the relevant test. The authorities reveal some conflicting discussion as to whether “improper” conduct on the part of a party in the context of s.19 of the Act had the meaning given to it by Nolan LJ (as he then was) in DPP v Denning [1991] 2 QB 532, at p.541 or whether the test for impropriety was to be equated with that for wasted costs ordered against a legal representative under s.19A of the Act (see, R v Geoffrey Counsell [2014] WL 978909, 13^th March 2014 and R (DPP) v Crown Court at Sheffield [2014] EWHC 2014; [2014] 1 WLR 4639, in obiter observations at [28] – [30]). Before us, however, all parties accepted that the law was correctly stated in R v Evans (Eric)(No.2) [2015] EWHC 263 (QB); [2015] 1 WLR 3595 and R v Cornish [2016] EWHC 779 (QB). These decisions reject an equation of the meaning of “improper” in s.19 of the Act with the test for wasted costs, contained in s.19A of the Act. They adopt the test for “improper” in s.19 of the Act furnished by Nolan LJ in Denning (supra), at p541, namely:

“ ….the word ‘improper’ in this context does not necessarily connote some grave impropriety. Used, as it is, in conjunction with the word ‘unnecessary’, it is …intended to cover an act or omission which would not have occurred if the party concerned had conducted his case properly.”

For my part, I am content to adopt the test as thus accepted by the parties.

In the circumstances, I go directly to the central passages in Evans and Cornish. In Evans, Hickinbottom J (as he then was) said this at [148]:

“ (i) When any court is considering a potential costs order against any party to criminal proceedings, it must clearly identify the statutory power(s) on which it is proposing to act; and thus the relevant threshold and discretionary criteria that will be applicable.

(ii)

In respect of an application under section 19 of the 1985 Act, a threshold criterion is that there must be ‘an unnecessary or improper act or omission’ on the part of the paying party, i.e. an act or omission which would not have occurred if the party concerned had conducted his case properly or which could otherwise have been properly avoided.

(iii)

In assessing whether this test is met, the court must take a broad view as to whether, in all the circumstances, the acts of the relevant party were unnecessary or improper.

(iv)

Recourse to cases concerning wasted costs applications under section 19A or its civil equivalent, such as Ridehalgh’s case [1994] Ch 205, will not be helpful…..

(v)

The section 19 procedure is essentially summary and so a detailed investigation into (e.g.) the decision-making process of the prosecution will generally be inappropriate.

(vi)

Each case will be fact-dependent; but cases in which a section 19 application against a public prosecutor will be appropriate will be very rare, and generally restricted to those exceptional cases where the prosecution has acted in bad faith or made a clear and stark error as a result of which a defendant has incurred costs for which it is appropriate to compensate him. The court will be slow to find that such an error has occurred. Generally, a decision to prosecute or similar prosecutorial decision will only be an improper act by the prosecution for these purposes if, in all the circumstances, no reasonable prosecutor could have come to that decision.”

While we did not hear argument on this point, as it seems to me, proposition (ii) could helpfully be refined. While it is right that proposition (ii) refers to an improper act or omission as one which ‘would not have occurred if the party concerned had conducted his case properly’, with respect, I am minded to think that the wording which follows should be amended to read ‘or which should otherwise have been properly avoided’. I doubt that it suffices for the purposes of s.19 that the procedure objected to could have been avoided unless proper conduct of the proceedings would have required that course.

In Cornish, Coulson J, having reviewed the relevant authorities, including Denning (supra), R v P [2011] EWCA Crim 1130 and Evans (supra), summarised the relevant principles as follows (at [16]):

“ (a) Simply because a prosecution fails, even if the defendant is found to have no case to answer, does not of itself overcome the threshold criteria of s.19 (R v P, Evans).

(b)

Improper conduct means an act or omission that would not have occurred if the party concerned had conducted his case properly (Denning).

(c)

The test is one of impropriety, not merely unreasonableness… The conduct of the prosecution must be starkly improper such that no great investigation into the facts or decision-making process is necessary to establish it (Evans).

(d)

Where the case fails as a matter of law, the prosecutor may be more open to a claim that the decision to charge was improper, but even then, that does not necessarily follow because ‘no one has a monopoly of legal wisdom, and many legal points are properly arguable’ (Evans).

(e)

It is important that s.19 applications are not used to attack decisions to prosecute by way of a collateral challenge, and the courts must be ever vigilant to avoid any temptation to impose too high a burden or standard on a public prosecuting authority in respect of prosecution decisions (R v P, Evans).

(f)

In consequence of the foregoing principles, the granting of a s.19 application will be ‘very rare’ and will be ‘restricted to those exceptional cases where the prosecution has made a clear and stark error as a result of which a defendant has incurred costs for which it is appropriate to compensate him’ (Evans).”

Both Evans and Cornish concerned public prosecutors. What of private prosecutions? First, as reiterated in R (Gujra) v Crown Prosecution Service [2012] UKSC 52; [2013] 1 AC 484, by Lord Neuberger of Abbotsbury PSC (at [68]):

“ There is no doubt that the right to bring private prosecutions is still firmly part of English law, and that the right can fairly be seen as a valuable protection against an oversight (or worse) on the part of the public prosecution authorities, as Lord Wilson JSC acknowledges at paras. 28 and 29, and Lord Mance JSC says at para. 115.”

On this footing, the law should guard against inadvertently discouraging the bringing of private prosecutions because of a fear of adverse costs consequences.

Secondly, however, those bringing and conducting a private prosecution must conform to the highest standards, as “Ministers of Justice”. In R v Zinga [2014] EWCA Crim 52; [2014] 1 WLR 2228, Lord Thomas of Cwmgiedd CJ said (at [61]):

“ …. Advocates and solicitors who have conduct of private prosecutions must observe the highest standards of integrity, of regard for the public interest and duty to act as a Minister for Justice (as described by Farquharson J) in preference to the interests of the client who has instructed them to bring the prosecution. As Judge David QC, a most eminent criminal judge, rightly stated in R v George Maxwell (Developments) Ltd [1980] 2 All ER 99, in respect of a private prosecution:

‘Traditionally Crown counsel owes a duty to the public and to the court to ensure that the proceeding is fair and in the overall public interest. The duty transcends the duty owed to the person or body that has instituted the proceedings and which prosecutes the indictment.’”

See too, the observations of Buxton LJ (giving the judgment of the Court) in R v Belmarsh Magistrates’ Court, ex parte Watts [1999] 2 Cr App R 188, at p.200, as to private prosecutors being subject to the same obligations, as a minister of justice, as are the public prosecuting authorities.

Thirdly, because private interests are, to some degree, almost invariably inherent in the bringing and conduct of private prosecutions, there is more scope for scrutiny of private prosecutors than public prosecutors. As Sir Richard Buxton observed, in The Private Prosecutor as a Minister of Justice, [2009] Crim LR 427, at p.427:

“ A private prosecutor will almost by definition have a personal interest in the outcome of a case.”

As an important constitutional principle, public prosecutors enjoy a wide and independent prosecutorial discretion, including, under the Code for Crown Prosecutors, a focus on the public interest. They are not immune from scrutiny (see, for instance, the Victims Right to Review (“VRR”) Scheme) but the Court will be astute to avoid the jurisdiction under s.19 of the Act being misused by becoming an appeal from a prosecutorial decision: see, R v P (supra), at [15]. While the private prosecutor too must enjoy a wide measure of discretion and s.19 must not be abused so as to have a chilling effect, realistically there will likely be more room for questioning the initiation and conduct of a private prosecution. This is, perhaps, especially so where individuals, in effect, seek to prosecute or turn the tables on their accusers: R (Dizaei) v Westminster Magistrates’ Court [2012] EWHC 4039 Admin, esp. at [33], [34] and [36] - where the contrast with the independence and detachment of a public prosecutor is particularly noteworthy. That said, when scrutinising private prosecutors, the principles set out in Evans and Cornish (both supra) will be applicable, mutatis mutandis. A private prosecutor will not be liable for costs merely because the prosecution fails or is withdrawn, still less because it is a private prosecution.

(3) Was DJ Ikram entitled to make the finding of impropriety? Underlining the question for this Court is whether the Judge was entitled to make the finding he did, as set out at [11] – [21] of the Decision. Applying the principles to which I have already alluded, I am amply satisfied that he was. Approached on a summary basis, the application to commence a private prosecution amounted to a clear and stark error, as evidenced by its abandonment; it fell short of the standards required of a minister of justice. My reasons follow.

First, in the light of the allegations advanced by the Claimant’s legal representatives as to the circumstances under which he came to be in Dubai, the obvious course was to bring the matter to the attention of the Police, the CPS and the Foreign and Commonwealth Office (“the FCO”). Given the Claimant’s (apparently) lawful detention in a foreign friendly State, the matter was bound to be anything but straightforward. But the plain and obvious place to start was with the relevant authorities in this country. Launching a private prosecution, with every appearance of an attempt to turn the tables on the Claimant’s accusers, was a strikingly inappropriate step to take.

Secondly, it is difficult to follow the justification based on urgency so far as it related to the progress of the prosecution in this country. The argument for urgency had force, if it had force at all, with regard to putting pressure on the IPs – by the making of serious allegations here - with regard to the Claimant’s continued detention in Dubai. With respect, however, that was a manifestly extraneous or collateral consideration, to be contrasted with the object of acting as a dispassionate minister of justice and getting the underlying allegations before a jury in this country.

Thirdly and in any event, from the 11^th February onwards it was or must have been evident to the Claimant that the attempt to proceed ex parte in launching the private prosecution was not going to succeed and that, realistically, the private prosecution would not make rapid progress. Ordinarily, the laying of an information is followed by the magistrate issuing a summons or a warrant. Before taking these steps the magistrate is not obliged to give notice to the putative defendant. However, Mr Jones accepted that the magistrate does have a discretion to require the intended defendant to be told of the application for criminal proceedings to be commenced. Mr Jones therefore accepted that DJ Roscoe had power to make such a direction on 11^th February. In my judgment DJ Roscoe was right to exercise that power in the circumstances of this case. Even if not before, from the 11^th February, the Claimant must have appreciated that the private prosecution he was seeking to commence would be contentious in the extreme.

Fourthly, the inconsistency between the Claimant’s stance in the Dubai proceedings and the private prosecution here, highlighted by Sir David Steel (supra), was indeed “pretty startling” (as Sir David put it). It is a matter of relevance when considering the propriety of the bringing of the private prosecution.

Fifthly, despite the writing being on the wall from (latest) 11^th February, 2015, the Claimant persisted with the private prosecution up to, including and beyond the hearing before DJ Ikram on the 9^th April, 2015. Inevitably significant costs were incurred by the IPs. It was only in the 20^th April letter that the Claimant indicated a change of course. For my part, nothing had changed between the 11^th February and the 20^th April, other than the expression by DJ Ikram of his – unsurprising – preliminary view. Even then, the application was not finally abandoned until its dismissal in DJ Ikram’s 12^th June Ruling. It follows that, as Mr Darbishire QC (for the Third IP) submitted, the abandonment of the application for a private prosecution evidenced how “ill-considered” it had been to instigate those proceedings.

For completeness:

For the reasons set out above and on the particular facts of this case, DJ Ikram was entitled to find that the application to instigate a private prosecution, together with its continuation until its final abandonment, constituted an “improper act” within the meaning of s.19 of the Act. I would therefore dismiss Ground I of the Claimant’s challenge. It follows that the IPs satisfied the threshold requirement and that DJ Ikram had jurisdiction to go on to consider the quantum of costs.

This Ground can be dealt with summarily. As already indicated, in my view, the inconsistency between the Claimant’s stance in Dubai and in this jurisdiction, was a relevant factor in considering whether there had been an “improper act” on the part of the Claimant. Accordingly, the Judge was right and certainly amply entitled to take the observations of Sir David Steel (supra) into account. For completeness and to the extent that the contrary was submitted, I could detect no confusion in the observations of Sir David Steel to which the Judge had regard. I would dismiss this Ground of challenge.

This Ground too can be disposed of summarily. The argument is that the Judge was wrong not to adjourn the proceedings on costs, to await the Claimant’s return to the jurisdiction and hear evidence from him. With respect, this is hopeless. First, as already observed, the Claimant took steps to commence the prosecution of the Interested Parties knowing that he might well be pursuing it while in custody in Dubai. Secondly, by the time the application for an adjournment was advanced on the 7^th September, 2015, all parties had already requested the Judge to deal with costs on the papers and without a hearing; there was no or no sufficient warrant for a late change of course. Thirdly, and of itself decisive, the Claimant had been represented throughout by leading counsel; there was nothing any evidence from him could usefully add to that which had been submitted on his behalf. DJ Ikram’s conclusion that the matter should not be further adjourned was succinctly explained at [16] – [19] of the Decision; it cannot be faulted.

(1) The grant of permission: Under the 8^th February order, Blake J gave permission on this Ground only, observing that he did so with “some hesitation”. He also granted a stay for a period of 28 days, to give the Claimant and the IPs the opportunity to reach agreement on a reduced quantum of costs. Unfortunately, no such agreement was reached. In his judgment of 12^th July, 2016, Lord Thomas CJ directed that the evidence before DJ Ikram in relation to the quantum of costs should be provided to the Court; he continued as follows (at [14]):

“ It will be for the court then to consider, in the light of the information that was before the court, the initial threshold question of whether it was right at all to make an order without detailed consideration of the amounts. If the court considers that it is right to do so, it will then have to consider…whether the costs awarded were proportionate.”

(2) The threshold question: The question posed by Lord Thomas CJ was whether it was right make an order without detailed consideration of the amounts. In my judgment, DJ Ikram was right to proceed as he did and to make an order. First, the Crim PR in force at the time provided, through the then equivalent of r.45.8(7), that the Court must assess the amount itself. The Crim PR did not then include an equivalent provision to the now r.45.8(8)(a), providing for the direction of an enquiry by the Lord Chancellor to assist the Court in assessing the amount itself. Secondly, judging by the materials produced to this Court and which were before DJ Ikram, details of the amounts said to have been incurred were available to him. Thirdly, the parties urged on the Judge that he should proceed by way of a summary assessment, rather than a detailed assessment (even assuming that it would have been open to the Judge to make a detailed assessment).

(3) New and grave allegations: Before us, Mr Jones advanced new and grave allegations, not foreshadowed before DJ Ikram. These submissions went well beyond the contention that the costs claimed by the IPs and awarded by the Judge were excessive, exorbitant, unreasonable or disproportionate. Instead, Mr Jones now argued that the conduct of the IPs in claiming the costs in question was “fraudulent” – a matter, Mr Jones told us, he did not shrink from arguing. In his skeleton argument, Mr Jones said this:

“ 107. The reality is plain. The Defendant [i.e., in effect, DJ Ikram] should have recognised the bills as fictitious, put forward by the interested parties in the belief that the criminal conduct and bullying disclosed by the conduct of the interested parties, would force him [i.e. the Claimant] to abandon his attempts to defend himself against the Dubai proceedings by making a comprehensive settlement taking into account any costs awarded by the Defendant.

115.

It is clear from [the] analysis set out above, that the bills submitted on behalf of the Interested Parties are an exercise in creative fiction….. ”

Further and by way of a linked allegation, Mr Jones, through his skeleton argument, placed before the Court an offer made by the solicitors for the First and Second IPs, by letter dated 10^th August, 2016, to settle these proceedings, headed “Without prejudice save as to costs” (“the August offer”). It was wrong, Mr Jones submitted, to “hide” the August offer “under the cloak of privilege” because that offer demonstrated the “fictitious nature” of the original bills.

To repeat, these are grave allegations; necessarily, they reflect in particular on the legal representatives of the IPs in these proceedings. For my part, I have no hesitation in dismissing these allegations. With respect, I deeply regret their introduction into this litigation. My reasons follow.

First, as Nicol J observed in the course of argument, given that our jurisdiction involves a review of DJ Ikram’s Decision, it is difficult to see how it can now be open to the Claimant to advance these allegations when they were not advanced before the Judge. Absent some substantial change of circumstances between the time of the hearing before the Judge and the hearing before this Court – and none such is asserted – I do not think it is open to the Claimant to introduce these allegations for the first time now.

Secondly, I have read and re-read Mr Jones’s detailed critique of the bills of costs, advanced in his skeleton argument (at paras. 74 and following). Whatever the force or appropriateness of the arguments there advanced as to the reasonableness or otherwise of the claim for costs (see below), they simply do not furnish a foundation for allegations of “creative fiction” or fraud arising from the contents of the bills. Some brief examples suffice. Thus, “inflated” billing hours even if made good (without more), suggest an excessive rather than a fraudulent claim. So too, given the close connections between GFH and the IPs, erroneous attribution (if such there was) may provide a basis for some reduction of the bill/s – but, again, by itself does not come close to making good a charge of fraud. So too as regards the absence of justification (if that be the case) for relatively small sums of expenses. As to the Third IP, the allegations, sensibly considered in context and having regard to the response from his solicitors, do not begin to make good a claim of fraud.

Thirdly, the Claimant seeks to place weight on the fact that the solicitors for the First and Second IPs discounted their original bill from £138,000 odd to £121,000 odd. I confess to being at a loss to understand how this reduction in the claim lends any support to the Claimant’s contention of fraud. A rounding down of an initial claim for costs is hardly unusual and there is no reason whatever to doubt the explanation that it was done in a spirit of reasonableness. To my mind, this reduction reveals a business-like approach to the claim for costs rather than anything else, let alone anything sinister.

Fourthly, as to the “without prejudice” offer on the part of the solicitors for the First and Second IPs, I reject the submission that this demonstrates the “fictitious” nature of the original bills. There is no warrant for that allegation whatsoever or for the drawing of any such inference. Generous though the offer may have been, the obvious and sensible explanation is the desire to bring an economical end to this acrimonious litigation.

Fifthly, it follows that there was no proper justification for placing before the Court the “without prejudice” August offer. The public policy importance of the privilege protecting “without prejudice” communications is such that it will not readily be displaced. For present purposes, the only basis on which that could happen involves an abuse of privilege; on the view which I take of the August offer, there was no abuse of the privilege and thus no basis for placing that offer before the Court. The law in this regard is clear. In Unilever Plc v Procter & Gamble Co [2000] 1 WLR 2436, Robert Walker LJ (as he then was) said this (at p.2444):

“ …Apart from any concluded contract or estoppel, one party may be allowed to give evidence of what the other said or wrote in without prejudice negotiations if the exclusion of the evidence would act as a cloak for perjury, blackmail or other ‘unambiguous impropriety’….”

In cases where the protection afforded by the rule had been “unequivocally abused” (at p.2449), the veil imposed by public policy “may have to be pulled aside”. As elaborated upon by Rix LJ, in Savings & Investment Bank Ltd v Fincken [2003] EWCA Civ 1630; [2004] 1 WLR 667, at [57]:

“ …that philosophy [i.e., underlying the without prejudice rule] is antagonistic to treating an admission in without prejudice negotiations as tantamount to an impropriety unless the privilege is itself abused. That …is what Robert Walker LJ meant in the Unilever case …when he repeatedly spoke in terms of the abuse of a privileged occasion, or of the abuse of the protection of the rule of privilege…. That is why Hoffmann LJ in Forster v Friedland 10 November 1992 emphasised that it was the use of the privileged occasion to make a threat in the nature of blackmail that, if unequivocally proved, unacceptable under the label of an unambiguous impropriety…… It is not the mere inconsistency between an admission and a pleaded case or a stated position, with the mere possibility that such a case or position, if persisted in, may lead to perjury, that loses the admitting party the protection of privilege…. It is the fact that the privilege is itself abused that does so. It is not an abuse of the privilege to tell the truth, even where the truth is contrary to one’s case. That, after all, is what the without prejudice rule is all about, to encourage parties to speak frankly to one another in aid of reaching a settlement: and the public interest in that rule is very great and not to be sacrificed save in truly exceptional and needy circumstances.”

No such circumstances were present in this case.

Sixthly, there remains the submission that, as this was a public law matter, the parties could not settle the dispute as to costs. Mr Jones contended that it was not within the gift of the First and Second IPs to offer to resolve the dispute because of the costs order made by DJ Ikram. Unless and until that order was quashed or varied, the Claimant remained subject to it. Indeed, “the making of a collusive bargain intended to defeat a lawfully imposed court order might well constitute either a contempt of court or potentially a conspiracy to pervert the course of justice…” and thus fell outside the protection of the without prejudice privilege. This is misconceived. To begin with, the submission is belied by the stay granted by Blake J, to permit the parties to attempt to reach an agreement on quantum. Further, had there been an agreement on quantum, the parties could have come before this Court with a consent order for the Court’s approval. In this way, an order of this Court would have been substituted for the order of DJ Ikram, thus effectively quashing the latter. All this is common sense and it is, with great respect, absurd to suggest that a bona fide attempt to settle the dispute would have risked a contempt of court or potentially disclosed a conspiracy to pervert the course of justice.

Unfortunately, the introduction of such highly charged and unfounded submissions of fraud and the like, inevitably increases the costs of the litigation. By way of practical example, these allegations made it unavoidable that the separate representation of the First and Second IPs on the one hand and the Third IP on the other, would continue at the hearing before this Court.

(4) Matters of quantum: (A) The correct approach: With regard to the correct approach in assessing costs under s.19 of the Act, it suffices to refer to another judgment of Hickinbottom J in Evans v Serious Fraud Office [2015] EWHC 1525 (QB), at [20]; [2015] 3 Costs LR 557:

“ i) If making a section 19 order, the court has to order that a specified amount is paid by one party to another party…This requires the judge to assess the costs to be paid…

ii)

Unless the judge considers it appropriate to depart from the general rule (and gives reasons for doing so), the assessment must be of an amount that reasonably compensates the receiving party for costs ‘actually, reasonably and properly incurred’ as a result of the unnecessary or improper act or omission identified, and ‘reasonable in amount’, in this context, ‘reasonableness’ incorporating a degree of proportionality……

iii)

The statutory scheme envisages a summary assessment, adopting a broad-brush approach. Unlike a summary assessment of costs in civil proceedings, there is no fixed procedure; and the judge may adopt any procedure that gives all relevant parties a fair opportunity to make representations.

iv)

The judge must satisfy himself that the amounts claimed do not offend the indemnity principle….

v)

In making the assessment, the judge must take into account all relevant factors….

vii)

In making the assessment, the judge has a very wide discretion. There is no appeal: his determination will only be subject to challenge on public law grounds.

viii)

The judge is required to give reasons for his decision; but in the context of the fact that he is making a broad-brush summary assessment. His reasons need therefore cover only the main issues between the parties. The judge does not explain why he has come to the precise figure to which he has come – let alone descend to the consideration of individual items that would be appropriate in an assessment by a taxing authority – so long as the parties can understand broadly why he considers that figure reasonably to compensate the receiving party for costs reasonably incurred as a result of the identified unnecessary or improper act(s) or omission(s). There is simply no requirement that a receiving party should give the detail required on a detailed assessment, and the judge should not be drawn into performing anything akin to a detailed assessment…. ”

As is plain, the jurisdiction of this Court does not extend beyond a review of the assessment of costs conducted, summarily, by DJ Ikram. It is emphatically not the task of this Court to assess costs as if we were a Court of first instance. Still less is it our task to conduct a detailed assessment or to be drawn into something akin to a detailed assessment.

(B) The Claimant’s criticisms of DJ Ikram’s Decision: As earlier foreshadowed when dealing with the allegation of fraud, the Claimant advances a number of detailed criticisms of DJ Ikram’s Decision.

Hitherto, however, that was not the stance taken by the Claimant. Instead, it was common ground before DJ Ikram that he should conduct a summary assessment without a hearing – at least until the unsuccessful application to adjourn. The Claimant did advance a submission that the IPs’ legal representatives should be limited to legal aid rates; that submission was dealt with in terms and rejected by the Judge (at [23] of the Decision) for the reasons he there gave. No conceivable criticism could be made of DJ Ikram’s ruling that the IPs’ legal representatives should be paid at private client rates – the same basis, it may be remarked, upon which the Claimant’s legal team had been paid. Beyond the point as to legal aid rates, the Claimant invited DJ Ikram to scrutinise the number of lawyers involved, the work done by them and the reasonableness of the costs thus claimed in an understandably broad-brush manner. On the material available to this Court, the submission advanced in the skeleton argument of Mr Fenwick QC and Mr Bodnar, for the First and Second IPs, seems well-founded: namely, that DJ Ikram was not called upon to make any decision about any specific item of costs. In these proceedings, the Claimant initially adopted the same approach, contending that DJ Ikram should have given greater scrutiny to the hours of work claimed, especially where the amounts in question were so substantial.

It is against this background that I come to the more detailed criticisms advanced by the Claimant in counsel’s skeleton argument (at paras. 74 – 111). First, I can at once dispose of and reject a number of discrete criticisms, in the case of Bryan Cave going to work apparently done for GFH and, in the case of Peters & Peters, going to considering an article on champerty, work done in connection with other litigation concerning the Third IP and a meeting with the City of London Police. First, these were specific criticisms which were not advanced before the Judge; they should not be entertained now. Secondly and in any event, I am satisfied with the reasonableness of the explanations given by Bryan Cave and Peters & Peters as to these items being relevant to the present litigation.

Secondly, I respectfully understand entirely Blake J’s stated concern as to the cost of separate legal representation before DJ Ikram, for the First and Second IPs on one hand and the Third IP on the other. I have given anxious consideration to this question but, ultimately, given the nature of this litigation and the discernibly separate interests involved, I would be unwilling to conclude that separate representation was unjustified, still less that DJ Ikram exceeded his power in deciding that separate representation was justified.

Thirdly, DJ Ikram considered carefully the substantial sums of costs incurred (at [24]) of his Decision. He dealt expressly with proportionality, having regard both to the gravity of the allegations advanced against the IPs and the formidable legal team engaged on behalf of the Claimant (together with the costs incurred by that team). Having done so, he concluded that the costs incurred by the IPs were not remarkable, even if, at first sight, they had seemed large. With the generality of that approach I respectfully agree. In terms of r. 45.2(7) (set out above) of the Crim PR, it involved defending grave allegations advanced by the Claimant; the matter was complex; considerable skill was needed to deal with it and the time spent on the case was necessarily significant. The costs actually, reasonably, properly and proportionately incurred by the IPs were bound to be substantial, far exceeding the norm for costs incurred in summary proceedings.

Fourthly and while respecting both the summary nature of the assessment conducted by DJ Ikram and the limited review jurisdiction of this Court, I am, however, persuaded that there is some small room for reducing the amount of costs awarded and that I should do so. Experience of substantial litigation teaches that it is all too easy for hours to burgeon beyond that which is proportionate, especially when a number of fee-earners are involved. Even on a summary assessment, bills of costs require scrutiny with this consideration in mind. In the present case, proceeding by way of a summary and broad-brush approach, I would be minded to reduce the costs awarded to the First and Second IPs from £121,500 to £100,000 and the costs awarded to the Third IP from £108, 946.14 to £90,000. I should add that, in respect of the First and Second IPs, this reduction also involves disallowing the small sums of expenses criticised in the Claimant’s skeleton argument at paras. 93 – 96, totalling a little less than £800. To such extent and such extent only, with respect, the Decision ought to have subjected the costs claimed to greater scrutiny and, exercising this Court’s review jurisdiction, I would make the reductions indicated. In all other respects, I would dismiss Ground IV. For the avoidance of any doubt, these relatively modest reductions do not imply any criticism of Bryan Cave or Peters & Peters.

I would be grateful for the assistance of counsel in drawing up an order reflecting the decisions expressed in our judgments.

The Court’s inquiry as to whether there was available a non-contentious summary of the Dubai proceedings provoked a flurry of exchanges after the hearing, all too emblematic of the acrimonious manner in which this litigation has been conducted. In the event, I have not relied on anything in the documents thereafter sent to us, save for the transcript in Dizaei (supra), a decision to which reference had been made in the documents available to us for the hearing.

I agree.