Haigh v Westminster Magistrates Court & Or

This is the judgment of the court to which we have both contributed.

The substantive judicial review in this matter was brought by the Claimant, David Haigh, to challenge an order for costs made against him by the Westminster Magistrates’ Court. That costs order followed him withdrawing his request for a criminal summons or warrant to be issued against Messrs Patel, Al Rayes and Gray. In the judicial review proceedings, Mr Patel was the 1^st Interested Party, Mr Al Rayes, the 2^nd Interested Party and Mr Gray the 3^rd Interested Party. Alun Jones QC was leading counsel for Mr Haigh. The substantive application for judicial review was heard on 12^th October 2016 and dismissed in a reserved judgment on 16^th February 2017 by a Divisional Court comprising Gross LJ and Nicol J - see [2017] EWHC 232 (Admin). Certain matters remained outstanding and a further judgment was handed down on 22^nd March 2017 – see [2017] EWHC 559 (Admin). One of the outstanding matters was a possible application for wasted costs which had been mooted by the 1^st and 2^nd Interested Parties (‘1&2 IP’). The 3^rd Interested Party had indicated that he did not intend to seek any such order. We said at [21] of that judgment,

The formal order was made on 22^nd March 2017 and any application for wasted costs had to be made by 19^th April 2017.

On that day 1&2 IP applied for Mr Jones to pay costs which were said to have been wasted by reason of his improper or unreasonable behaviour.

The Practice Direction to CPR part 46 envisages that the Court will deal with a wasted costs application in two stages. Paragraph 5.2(a) of the Practice Direction says that, at the first stage, the court must be satisfied—

On 19^th July 2017 we held a Stage 1 hearing. In our decision – see [2017] EWHC 2385 (Admin) we said that we were persuaded that there was enough material so that the application for wasted costs was likely to succeed if such material was untested or unchallenged in relation to the introduction of allegations of fraud into the substantive judicial review claim. We explained that we regarded the introduction of the without prejudice material at the substantive judicial review hearing as not having any discrete or independent existence apart from the introduction of unfounded allegations of fraud. We limited the claim to the costs of instructing Justin Fenwick QC for the purposes of the substantive judicial review hearing. We said at [5(d)] of that decision,

Framed in this way we considered that the wasted costs application did pass the proportionality test in paragraph 5.2(a)(ii) of the Practice Direction. We gave directions for the Stage 2 hearing. They included the following,

The directions of 19^th July were subsequently varied by Ms Victoria Basset, an Administrative Court lawyer, on 2^nd October 2017. As varied, they now set the following timetable:

Ms Bassett’s decision recorded her reasons as follows,

We must now consider the two applications before us.

By their application issued on 2^nd November 2017 the 1 &2 IP have sought further extensions of time. They seek

Mr Jones’s application was issued on 6^th November 2017. He seeks an order that the application for wasted costs should be struck out as an abuse of process because the 1&2 IP failed to file and serve their outline submission together with a proposed index by 20^th October, that being the second time that the 1&2 IP had failed to comply with the court’s timetable. In the alternative, Mr Jones sought further time to serve his outline submission for stage 2 – 14 days after service of the outline submission of the 1&2 IP’s outline.

The Court notified the parties that it wished to have written submissions regarding bothapplications. Those have been received. Both applications asked the court to determine the matters without a hearing. Neither party’s written submissions requested a hearing. We agree that a hearing is not necessary and we have therefore reached our decisions on the papers.

In their application notice the solicitor for the 1 and 2 IP says

Mr Jones’s solicitor says that the 1&2 IP were in breach of the earlier obligation to file and serve by 23^rd August 2017 their evidence in relation to the costs of Mr Fenwick for the hearing on 12^th October 2016. This evidence was not provided until 1^st September 2017. They applied retrospectively on 26^th September 2017 for the time to be enlarged. It was this application which led to Ms Bassett’s order of 2^nd October 2017. The 1&2 IP failed again to comply with the Court’s direction to file and serve their outline submission for the Stage 2 hearing and proposed index by 20^th October. Mr Jones’s solicitor says she wrote to the Court on 24^th October drawing attention to this default. The 1&2 IPs’ solicitor had not responded to correspondence from Mr Jones’s solicitor.

CPR r. 3.9 provides

The Court’s order of 19^th July 2017 as varied on 2^nd October 2017 did not specify any sanction for non-compliance, but on a retrospective application for an extension of time, the same principles are applied – see Altomart Ltd v Salford Estates (No.2) [2014] EWCA Civ 1408; [2015] 1 WLR 1825.

The leading authority on the approach to a r.3.9 application is Denton v T.H. White Ltd [2014] EWCA Civ 906; [2014] 1 WLR 3926. As summarised in the headnote:

(1) Seriousness and significance: In this case the 1&2 IP submit that the breach for which they sought a retrospective extension (the time to lodge their outline submission and draft index for the hearing bundle for Stage 2) was neither serious nor significant. The time for providing the missing documents had not been the subject of an ‘unless’ order. The extension was only some 14 days. The requested extension meant that other procedural steps had also to be adjusted. However, no hearing date had yet been set for Stage 2 and the aim of having a hearing before the end of the Michaelmas Term was still achievable.

We disagree. The context of the default is important. We are concerned with an application for wasted costs. Here the 1&2 IP allege that Mr Jones has been guilty of improper conduct. In these circumstances, compliance with the Court’s directions and the expeditious conduct of the proceedings is particularly important. Furthermore, the practice direction to CPR Part 46 [5.6] says,

It must not be forgotten that these are satellite proceedings, adjectival to the substantive judicial review application. In all the circumstances, a delay of two weeks is, in our view, a serious or significant default.

(2) Reason for the default: The second matter to be considered in accordance with the Denton guidance, is the reason for the default. We have quoted above the reasons given by Mr Dougans in the 1&2 IP application. We have to say that as an excuse for lateness it leaves much to be desired. At the request of the 1&2 IP, Ms Bassett had already extended time for the outline submissions and draft index by a week and it had been known since the Stage 1 hearing on 19^th July that outline submissions would be required for the Stage 2 hearing, as would an index to the hearing bundle. However unintentionally, it suggests a cavalier approach to the directions ordered by the Court. That is singularly inappropriate when the party concerned has itself chosen to pursue wasted costs proceedings. Having once chosen to do so, it was for 1&2 IP to ensure that it was in a position to comply with the Court’s directions

(3) All the circumstances: The third stage of the Denton process is to ‘evaluate all the circumstances of the case, so as to enable the court to deal justly with the application including the factors in sub-paragraphs (a) and (b) [of r.3.9(1)].’

Mr Ramsden on behalf of the 1&2 IP again emphasises that no date has yet been set for the Stage 2 hearing. It cannot be said that the extension which his clients seek would prejudice that hearing. He argues that the proportionate and just response is for the 1&2 IP to be granted the extension which they seek.

Mr Stewart QC on behalf of Mr Jones argues the contrary. He submits that there has been a history of procedural defaults by the 1&2 IP. Notably, they did not comply with the Court’s order to file and serve evidence of the costs of instructing Mr Fenwick QC within the time required by the Court on 19^th July 2017. That had to be done by 23^rd August 2017. It was not. Mr Jones’s solicitors chased a number of times. The evidence in relation to Mr Fenwick’s brief fee was finally provided after 5.0pm on 31^st August 2017.

Furthermore, the evidence then produced showed that Mr Fenwick’s brief fee had been £10,000. This contrasted with the figure of £35,000 given to the Court at the hearing on 19^th July 2017. That variation is material in deciding whether the wasted costs proceedings are still proportionate. Mr Stewart submits that they are not and this is another reason why the application by the 1&2 IP should be refused and, indeed, why Mr Jones’s application for the wasted costs proceedings to be struck out should be granted.

In our view, Mr Stewart is right. As we have already said, wasted costs proceedings are ancillary to the substantive proceedings (in this case the substantive application for judicial review). For the reasons already given, there is an onus on the applicant for a wasted costs order in particular to proceed with due expedition. The applicants in the present matter have not done that.

We also consider it significant that the amount in issue in the wasted costs application now appears to be £10,000. As part of the Stage 1 proceedings, the court has to form a judgment as to whether the wasted costs proceedings are justified notwithstanding the likely costs involved. We took the view on 19^th July 2017 that this test was satisfied when we were told that the sum involved was in the region of £35,000. We have seen correspondence between the parties concerning whether the court was misled by that figure. We are content to accept the explanation of Mr Dougans that £35,000 was meant to include not only Mr Fenwick’s brief fee but also additional costs incurred by Bryan Cave, the solicitors for the 1&2 IP. Be all that as it may, had we known that the amount in issue was £10,000, we would have taken a different view as to the proportionality of the wasted costs proceedings in all the circumstances of this litigation. While we have not been provided with any figures, we do not think that it is an extravagant assumption to proceed on the basis that the costs which each side has incurred will have substantially exceeded £10,000. The time estimate for the Stage 2 hearing is a half day which will involve yet further costs. Simply put, the exercise can now be seen to be disproportionate.

To recap, the 1&2 IPs’ failure was serious and significant. The reason advanced for the failure is unsatisfactory. By themselves, these two factors would have inclined us towards refusing the 1&2 IPs an extension of time. When regard is had cumulatively, to these two factors and to the true amount at stake, now reduced to £10,000, the scales tip decisively against an extension of time. In all the circumstances and in a nutshell, these proceedings are now disproportionate and plainly so.

Accordingly, we refuse the application by 1&2 IP for an extension of time. We grant the application of Mr Jones for the wasted costs application to be struck out.