Joanna Lemos & Ors v Church Bay Trust Company & Ors

This judgment concerns an application by the 2^nd and 3^rd Claimants, supported by the Defendants, which asks the court to record an agreement as to main action costs (including the cost of drafting a bill) in the sum of £1,011,135.40 and “Giving credit for the sums previously paid on account, the Second and Third Claimants shall pay the Defendants the sum of £53,321.40 (inclusive of any interest).”

The application further seeks orders that:

“The Second and Third Claimants and BCR shall pay the Defendants’ costs of the detailed assessment proceedings, summarily assessed on a basis to be determined by the court in the amount of [£x].

As against the Defendants, the Second and Third Claimants are jointly and severally liable with BCR for the costs in paragraph 3. However, as between the Second and Third Claimants and BCR, BCR shall be liable (inter se) to pay a 100% contribution towards that liability.”

It is observed that at the time of trial, at the handing down of the September 2023 judgment, and the subsequent order dated 18 October 2023, the named parties were the three Claimants and the three Defendants only.

In so far that the costs implications of the Interested Party’s involvement would later become an issue for this court to determine, Mr Nicol wished to stress that it was important to the Interested Party that various similar sounding names for ‘BCR’ were not used interchangeably but rather the full name of each relevant division be used.

In this respect, I observe that:

It is perhaps also helpful at this stage to be clear as to the court’s understanding that Gowling WLG (UK) LLP act for the 2^nd and 3^rd Claimants, Withers LLP for the Defendants, and Freeman Harris Solicitors for the Interested Party (with deferrals as necessary to expert costs practices whenever the solicitors on record for the parties saw fit).

It also assists to observe that the professional relationship between Withers and Gowlings has at all times during the costs proceedings been cordial and courteous.

Mr Teasdale acts for the receiving party Defendants and wished to make some brief opening comments.

He confirms that the paying party Claimants have settled the Defendants’ bill of costs and that the only remaining dispute concerns the costs of assessment.

He acknowledged today’s hearing was in respect of an application brought by the 2^nd and 3^rd Claimants against the Interested Party, and wanted to make some brief comments explaining why the Defendants support the 2^nd and 3^rd Claimants’ application.

He also invited me to note the costs as against the 1^st Claimant were settled at an early stage, and therefore any references he made to “the Claimants” was a reference to the 2^nd and 3^rd Claimants.

Mr Teasdale submits that the starting point is CPR 47.20(1), which provides that “The receiving party is entitled to the costs of the detailed assessment proceedings..” save for where exceptions apply.

He observes that the Claimants have accepted liability for the costs of assessment because the Claimants are fundamentally the paying party in this matter.

However, Mr Teasdale confirmed that his clients (the receiving party Defendants) support the application that ‘BCR Legal Assist Limited’ should be held jointly and severally liable for the Defendants’ costs of assessment.

Mr Teasdale also confirmed that his Defendant clients supported the part of the Claimants’ application which seeks a 100% contribution to the costs of assessment from BCR Legal Assist Limited.

When asked if the Defendants’ motivation for supporting the application was a concern as to the ability of the 2^nd and 3^rd Claimants to pay the sums to be summarily assessed, Mr Teasdale averred that no such concerns arose.

He said that the Defendants’ support of the application was based purely on the conduct of BCR Legal Assist Limited, which Mr Teasdale said was best left to the 2^nd and 3^rd Claimants’ counsel, Mr Waszak to explain.

Mr Waszak stands by his skeleton argument dated 15 May 2026 and set out a four-pointed approach, intended to address the background summary; initial response to the Interested Party’s skeleton argument (of Mr Nicol); relevant legal principles; and why the order sought should be made.

Mr Waszak explained that the Claimants brought a section 423 claim under the Insolvency Act 1986 which, following a trial which ran from 22 June to 4 July 2023, was dismissed (as per a judgment sealed on 23 September 2023).

A subsequent order, dated 18 October 2023, provided that:

“3.

The Claimants shall pay the Defendants’ costs of the Claim on the standard basis, to be assessed by detailed assessment if not agreed.

4.

The Claimants shall, within 28 days of the date of this Order, pay to the Defendants the sum of £957,814 (being costs of £798,178 plus VAT) on account of the Defendants’ costs of the Claim awarded under paragraph 3.”

Mr Waszak invited me to note that the recitals above in respect of costs were expressed “by consent” and averred that consensus came about by collaboration between the parties, rather than requiring the court’s determination as to who should pay the costs, and the amount of any payment on account of costs.

I was then referred to a 9 November 2023 letter from the Defendants’ solicitors, Withers LLP (hereafter referred to as “Withers”), in which a Part 36 offer to accept the sum of £1,372,005.79 was set out in respect of the costs liability of all three Claimants.

The recipient of that letter, Joanna Rhodes of Gowling WLG (UK) LLP (hereafter referred to as “Gowlings”) wrote an e-mail to Blake Wellman (of BCR Legal Group Limited) and Graham Shaw (of BCR Costs Limited) on 15 November 2023.

The purpose of that 15 November 2023 e-mail was for Gowlings to liaise with the 2^nd and 3^rd Claimants’ ATE insurer to inform them of the Defendants’ Part 36 offer and explain the breakdown of that offer.

The penultimate paragraph of that letter set out “We would like to respond with a counter-offer that is realistic and which puts [Withers] under severe pressure from the perspective of incurring further costs of preparing for detailed assessment.”

On 20 November 2023, Mr Wellman wrote to Ms Rhodes to say “I would respectfully suggest that you refrain from further work in this area as Graham [Shaw] now has conduct. Let's allow Graham to get to work on this. I am sure he will be liaising with you and Withers on these costs.”

This was followed, on the same date, by an e-mail from Mr Graham Shaw which read:

“You will by now have received notification from Blake that I am taking over conduct of dealing with the adverse costs claimed by Withers. I have spoken to Blake and obviously seen the chain of emails containing the offers and proposals. At this stage I am not in a position to objectively consider Withers’ Part 36 or the suggested counter proposals as I shall require sight of the full file of papers. I am assuming (forgive me if incorrect) that your file is in electronic form. Can you please arrange for me to have access to this (or the paper file if no electronic version is available). In the meantime, I will contact Withers to notify them of my interest.”

With reference to the first witness statement of Ms Naylor, I asked Mr Waszak to explain what was the “good progress” Ms Naylor mentioned at paragraph 10 of her statement, where she states:

“From 20 November 2023, BCR took sole conduct of the matter of the Defendants' costs and, ultimately, these Proceedings, from the Applicants and Gowling as the Applicants' solicitors. BCR insisted that its own costs company, BCR Costs Limited ("BCR Costs"), should have such conduct. That was in the face of strong objections by the Applicants, who had been making good progress in seeking to agree costs with the Defendants.”

In response, Mr Waszak cited an e-mail dated 10 November 2023 from Ms Rhodes of Gowlings to Ms Naylor of Withers (plus other persons) which confirmed instructions were being taken and explained:

“In order to consider your proposal, our clients require some further information as to the Defendants' costs of the proceedings. To that end, please could you confirm, by close on 15 November 2023, which of the costs and disbursements set out in your letter of yesterday's date were incurred prior to the filing of the application by the Trustees in Bankruptcy to join the claim on 29 January 2021, along with a full breakdown of any disbursements incurred during that time period.”

Mr Waszak also cited a letter from Withers, dated 15 November 2023, which set out the details requested.

Thereafter, Mr Waszak contended that “very little happened” between 20 November 2023 and 13 August 2025 (being the date that Freeman Harris came on record, and it being noted that Freeman Harris is the firm instructed by the Interested Party).

He argued that “very little progress” was made in this period, and that the involvement of BCR Legal Assist Limited/Freeman Harris had hampered the progress of inter partes costs negotiations.

Mr Waszak explained that as a precursor to Freeman Harris coming on the record, BCR Legal Assist Limited had to be added as an interested party.

This was achieved by way of a consent order dated 14 August 2025 and signed by the 1^st Claimant’s solicitors, the 2^nd & 3^rd Claimants’ solicitors, the Defendants’ solicitors, and BCR Legal Assist Limited.

Mr Waszak contends that whilst that order referred to BCR Legal Assist Limited as an “interested party”, they were “in reality” an additional party.

Mr Waszak invited me to note that Gowlings came off the record as acting for the 2^nd and 3^rd Claimants on 31 July 2025, with a Notice of Change filed to signal their new status as litigants in person.

The next key stage was a hearing before me on 23 September 2025 in which a preliminary issue was determined regarding the interpretation of an order dated 11 October 2022 insofar that it impacted costs budgeting.

At this stage Mr Waszak wished to correct an error in the recital of the judgment following the 23 September 2025 hearing in that it contains an erroneous reference to Nicholas Bacon KC being instructed by Gowlings and Freeman Harris, on behalf of the 2^nd & 3^rd Claimants and the Interested Party, whereas Gowlings were not on the record as at 23 September 2025, and the 2^nd & 3^rd Claimants were represented at the hearing by direct-access counsel Oliver Clement (who did not submit any written submissions or take part in that hearing).

Mr Waszak cites paragraphs 14 and 15 of Mr Nicol’s skeleton argument as corroboration of this fact and I do not challenge Mr Waszak in this regard.

Mr Waszak thereafter submits that in the absence of any settlement proposals from Freeman Harris, it was left to the paying party Defendants to make a further offer.

He cites a letter to Freeman Harris from Withers dated 6 January 2026 in which the Defendants offered to accept £957,814 to settle the costs (being the amount already paid on account), plus £211,244.20 for the Defendants’ costs of assessment, and £40,390 to cover the costs of having a detailed bill drawn.

Mr Waszak informed me that Freeman Harris subsequently wrote to the 2^nd and 3^rd Claimants, on 12 January 2026, opening the letter with “As you know, we act for BCR Legal Assist Limited (“BCR”), your ATE insurer in respect of the above-mentioned”.

That letter proceeded to set out:

“You will have now had the opportunity to review and consider the judgment of Costs Judge Nagalingam dated 18 November 2025. Whilst it is helpful that the Judge confirmed that “For the avoidance of any doubt, the case managing judge's comments shall not be disregarded, nor are they binding. They shall be taken into account when assessing costs.”, overall it is not the outcome we had hoped for as the Judge found that the orders were Costs Management Orders.

This is unfortunate as if the Judge had found for us, then there was a real chance of the Defendants’ costs being assessed down to the region of £350,000 to £600,000. Notwithstanding this, the Judgment has clearly had an effect on the Defendants as we have received the enclosed without prejudice save as to costs letter from Withers dated 6 January 2026. In this letter, they offer to accept a reduced sum of £957,814 in respect of the Defendants’ costs in addition to £251,634.20 for their costs of the detailed assessment. This is a significant discount on their previous Part 36 offer of £1,194,279.14 plus costs of the detailed assessment made on 1 November 2024.

As you know, the Limit of Indemnity for adverse costs is £1,000,000. Whilst BCR Costs’ efforts have resulted in the Defendants’ costs of the action falling below the Limit of Indemnity, when added to the costs of the detailed assessment, even if a greater reduction is made at the hearing next month, in all likelihood the £1,000,000 limit will be exceeded. Our client therefore has no financial interest in continuing to pursue a reduction in the Defendants’ costs. BCR and we have every sympathy with you as it is clear that there will now be a shortfall between BCR’s contribution and your liability. Of course, this was always a likelihood since Gowlings agreed a costs budget that was well in excess of the Limit of Indemnity on your ATE Insurance policy and did not seek an increase from BCR. That is a matter between you and Gowlings though.

There is currently £809,023.33 remaining in the total Limit of Indemnity (net of interim payments and legal costs of the assessment but including own costs that you are liable to Gowlings for). We therefore propose either:-

a.

BCR transfers to you the total sum of £809,023.33 and you can either continue with the Costs Assessment yourselves or liaise with the Defendants directly with a view to reaching a settlement but in any event, BCR’s involvement would cease at the point of transfer of funds; or

b.

If you are minded to accept Withers’ offer (a matter you will need to take your own advice on), BCR is content with accepting the offer on your behalf, paying the settlement sum to Withers and BCR would transfer any balance remaining in the overall.”

Mr Waszak advised that on 15 January 2026, Gowlings come back on the record as acting for the 2^nd and 3^rd Claimants and on the same date Gowlings accepted the offer contained in the Withers’ letter of 6 January 2026 – i.e. settlement of the bill in the sum of £957,814 but with the bill drafting fee and costs of assessment to be agreed.

Mr Waszak cited the proposed draft order, in support of the 2^nd and 3^rd Claimants’ application, found at page 685, of the bundle and commends that order to the court.

Citing paragraph 48 of Mr Nicol’s skeleton argument dated 15 May 2026, Mr Waszak rejects the assertion that the “terms on which the paying and receiving parties are alleged to have reached agreement” are opaque.

He says that the proposed draft order (bundle page 685) reflects what the 2^nd and 3^rd Claimants and the Defendants agreed and is therefore not incomplete, but rather an unambiguous agreement.

Mr Waszak relies on paragraphs 10 to 17 of his skeleton argument and submits that CPR 47.20(1) is a starting point only.

He wished to be clear that despite the application suggesting otherwise, the 2^nd and 3^rd Claimants are not seeking a non-party costs order (NPCO).

What they do seek is a ruling that because BCR Legal Assist Limited are a party; they can be ordered to pay costs.

He relies on an argument that CPR 47.20(1) makes no mention of who pays and also relies on CPR 47.20(1)(b), being the provision for the court to make “some other order in relation to all or part of the costs of the detailed assessment proceedings.”

Mr Waszak cited Sirketti v Kupeli & Others [2019] 1 WLR 1235 at paragraph 5(i) in which Hickinbottom LJ observed that:

“In considering orders for costs, the court is of course bound to pursue the overriding objective as set out in CPR r 1.1, i.e. it must make an order that deals justly with the issue of costs as between the parties. Therefore, when considering whether to make a costs order and, if so, the order it makes, the court has to make an evaluative judgment as to where justice lies, on the facts and circumstances as it has found them to be.”

Mr Waszak submits the 2^nd and 3^rd Claimants are inviting the court to make an evaluative judgment on the basis that it is the Interested Party’s conduct which caused the Defendants’ costs of assessment to be incurred.

He conceded that CPR 47.20(1)(a) does not apply and that in any event his clients are not pursuing an application pursuant to section 51 of the Senior Courts Act 1981 – but that the principles of making an evaluative judgment could also apply when a court was exercising the discretion conferred to it under CPR 47.20(1)(b) – which the 2^nd and 3^rd Claimants do rely on.

Mr Waszak submits that CPR 47.20(1)(b) expressly recognizes the court’s discretion to make an alternative order, and that “In deciding whether to make some other order, the court must have regard to all the circumstances” (CPR 47.20(3)).

Therefore the 2^nd and 3^rd Claimants’ application is made under 47.20(1)(b) only as of today, and is definitely not a Section 51 application, nor is it a NCPO application.

Mr Waszak submits that the starting point is for the court to acknowledge it can make an order which makes BCR Legal Assist Limited liable both before and after the joinder. It is thereafter a separate question of whether the court should make such an order.

Whilst seeking to be absolutely clear that his clients were not pursuing a Section 51 application, and this was not a NCPO application, Mr Waszak averred that nevertheless the principles in NCPO applications were helpful when the court was considering all the circumstances when conducting a CPR 47.20(3) exercise.

In this regard, Mr Waszak cited various authorities concerned with NCPO applications (as per paragraph 17 of his skeleton argument) and invited consideration of two broad categories of non-parties, being an intermeddler, or a non-party who is “the real party to the proceedings or part of them”.

For non-parties who are “intermeddlers”, Mr Waszak cited Travelers Insurance v XYZ [2019] UKSC 48 in which Lord Briggs recognised that “involvement [in litigation] which is (in old-fashioned language) wanton and officious, for which the non-party cannot demonstrate some justification or excuse” might lead to a NCPO.

Mr Waszak observed that where “involvement [in litigation]” alone was sufficient, it did not set the bar as high as requiring that control of the litigation be established.

As to the “real party” question, paragraph 17(5) of Mr Waszak’s skeleton argument sets out:

“In relation to the application of the real party test, the well-known statement of the Privy Council in Dymocks Franchise Systems v Todd [2024] 1 WLR 2807 (at paragraph 25(3)) is that a NPCO will ordinarily be made where a non-party funds and controls the proceedings. The case law typically shows that a party will be regarded as the real party if it is interested in a claim or part of a claim to the exclusion of the interests of the nominal party (so that the latter is a indeed a nominal party in both senses of that term): Travelers Insurance v XYZ [2019] 1 WLR 6075; and Tescher v Direct Accident Management Ltd [2025] 2 WLR 5064 at §§52-54.”

As to why BCR Legal Assist Limited should be ordered to pay the Defendants’ assessment costs, Mr Waszak relies on two broad points.

The first is a proposition that the Interested Party “controlled and funded the detailed assessment proceedings from an early stage, to the exclusion of the Claimants”. The Claimants’ case is that the Interested Party conducted the proceedings in an “aggressive and obstructive manner” which led to the same becoming protracted and lasting two and a half years.

The second proposition is that but for the Interested Party’s involvement, the Defendants’ costs would have been agreed without the need for detailed assessment proceedings. This is on the basis that (as per paragraph 18(2) of Mr Waszak’s skeleton argument) “Following BCR’s withdrawal from the proceedings in January 2026, the Defendants’ costs were swiftly agreed – in fact, on the same day that Gowling resumed conduct on behalf of the Claimants (15 January 2026)”.

Mr Waszak invited me to note that both propositions were supported by the receiving party Defendants.

In terms of conduct, he invited me to observe that it was BCR Legal Costs who prepared and signed off on the points of dispute.

Mr Waszak avers that that “BCR are the de facto paying party”, not the Claimants.

To make good on the proposition that the Interested Party conducted proceedings in an “aggressive and obstructive manner”, Mr Waszak cites a number of examples.

The first cited example is the receiving party Defendants’ Part 36 offer dated 9 November 2023 in the sum of £1,372,005.69. Mr Waszak suggests “That offer was made in the hope (and expectation) that even if not capable of acceptance it would initiate negotiations.. without the need to commence detailed assessment proceedings”.

It is thereafter argued that a wait of “almost two months later” (before BCR Costs Limited said they required sight of a detailed bill of costs) is an example of unreasonable delay caused by the Interested Party.

The second example cited is Withers’ letter of 24 April 2024 containing the bill of costs, in draft format, accompanied by confirmation that their Part 36 offer remained open for acceptance and stated “We encourage your client to now, finally, engage in negotiations as to the costs of these proceedings.” The letter set a deadline of 17 May 2024 for a response failing which detailed assessment proceedings were to be formally commenced.

Mr Waszak classified the reply from BCR Costs Limited on 15 May 2024 as a “holding response”. On that date, Mr Shaw of BCR Costs Limited said “I will not be in a position to provide a substantive response by your imposed deadline of 17th May. I am still awaiting certain information and instructions. If you feel that you need to commence assessment proceedings on a formal basis then please do so. I will respond when I am fully in a position to do so.”

Mr Waszak also cited an exchange of e-mails on 11 and 12 June 2024 in which Withers chased BCR Legal Costs - who said they were awaiting instructions. At the time, Withers had set a revised deadline of 27 June 2024 after which they would commence detailed assessment proceedings. The Notice of Commencement is dated 27 June 2024.

Mr Waszak submits this amounted to an 8 month delay, caused entirely by waiting for BCR Costs Limited.

Following service of the formal bill, Mr Waszak advised that Withers agreed to extend the time for service of points of dispute, which were subsequently served on 16 August 2024.

Mr Waszak submits that the service of the points of dispute was delayed when BCR Costs Limited requested copies of disbursements vouchers (on 6 August 2024). On the same date copies were provided and BCR Costs Limited were informed the same documents had been provided on 27 June 2024.

As to the served points of dispute, Mr Waszak argues that the Interested Party “advanced an entirely unreasonable and unrealistic approach in seeking to challenge the Defendants’ costs”.

Mr Waszak at this point was careful to point out that the points of dispute at page 616 of the bundle were those prepared by the 1^st Claimant, whose costs were settled by agreement such that the court would never have been asked to consider the 1^st Claimant’s points of dispute.

In seeking to criticize BCR Legal Costs’ approach to the points of dispute, paragraph 25(2)i of Mr Waszak’s skeleton argument states that the Interested Party’s points of dispute “contended that Counsel’s fees (including for brief fees for a two-week High Court trial) and that the fees of Opus bundling services (which the Claimants had in fact proposed, and which the parties had agreed to split 50:50) should be disallowed in their entirety. He described such objections as not just overly aggressive and ambitious, but “obviously hopeless”.

Another of Mr Waszak’s criticisms of the points of dispute prepared by BCR Legal Costs concerned the preliminary issue of the effect of the orders made by ICC Jones on 11 October 2022 and 20 January 2023 in respect of the Defendants’ costs budgets.

Mr Waszak referenced the Defendants’ Part 36 offer to settle costs at £1,372,005.79 on 9 November 2023 (reiterated on 24 April 2024 in a letter from Withers to BCR Legal Costs). It is in the context of that offer, and the bill served in the sum of £1,655,531.11, that Mr Waszak describes the offer advanced by BCR Costs Limited of £600,000 on 9 January 2025 as “absurd”.

Mr Waszak then turned to the outcome of the preliminary issues hearing, and the absence of settlement following the handing down of judgment on 18 November 2025 (in circumstances when a lengthy line-by-line detailed assessment was due to commence on 25 February 2026).

He cites a letter from Withers to Freeman Harris dated 4 December 2025 in which Withers recorded that “Indications were made at the hearing, in front of the Costs Judge, that a decision on the preliminary issue would open up settlement discussions. We await to hear from you urgently in respect of this noting that, given the Christmas period, we have begun preparations for the detailed assessment hearing already.”

Mr Waszak’s skeleton argument suggests that a response to that letter was requested by 11 December 2025, but that is certainly not evident from the letter itself.

He thereafter argued that the absence of a response signified “a blanket refusal to engage” and that absent “any realistic prospect of settlement, the Defendants were thus forced to engage in preparation” for the detailed assessment hearing.

As to his submission that “absent BCR’s involvement, the Defendants’ costs would have been agreed by the Claimants at an early stage without the need for detailed assessment proceedings” (paragraph 18(2) of the 2^nd and 3^rd Claimants’ skeleton), Mr Waszak accepts that the court cannot speculate. However he argues, the court may look at facts and explanations.

Mr Waszak referenced Ms Naylor’s 1^st witness statement (dated 27 February 2026), at paragraphs 49 and 50, where she said:

“49.

Taken collectively, the evidence establishes that having regard to all the circumstances of the case, it is just to make an order that BCR be jointly and severally liable for the costs of assessment with an order inter se for them to make a 100% contribution to that liability on the basis of: (i) BCR's conduct; and (ii) the amount by which the costs have increased as a result of that conduct.

50.

As the background illustrates, the instigation and continuation of these Proceedings arose solely because of BCR. Absent BCR’s involvement, the question of costs would have been resolved at an early stage and these Proceedings would not have been necessary. At all times since November 2023 until Gowling came back on to the court record at the end of last month, BCR have been responsible for the control and funding of these Proceedings.”

Mr Waszak also referenced Ms Mattar’s 2^nd witness statement (also dated 27 February 2026), at paragraph 71, where she said:

“71.

It is my genuine belief, based on the litigation and the negotiation on the Interim Payment, that we would have been able to negotiate and reach agreement relatively straightforwardly if Gowling retained conduct of the costs proceedings. It is my view that a very significant proportion of the costs incurred by the Defendants would have been avoided if BCR had conducted themselves more commercially with a view to settlement. Indeed, it seems entirely likely to me that we would have reached a settlement in late 2023/early 2024, prior to the commencement of the assessment, which would have avoided the costs of the detailed assessment proceedings entirely.”

Mr Teasdale confirmed that the Defendants support the 2^nd and 3^rd Claimants’ application, and that he endorses the submissions of Mr Waszak.

However, Mr Teasdale wished to add to those submissions by addressing two points, being; Why the court should order “BCR” to pay the Defendants’ costs; and additional features of the relevant chronology not addressed by Mr Waszak.

Mr Teasdale referenced the Interested Party’s own application, dated 4 March 2026, and section 3 of the same with reference to the notion that the Interested Party is “vulnerable” as a consequence of any agreement between the Claimants and Defendants.

He says the Interested Party is not “vulnerable” because the Claimants and Defendants accept it is not within their gift to “cook up” any form of order which binds the Interested Party – that is why an application and this hearing is necessary.

Mr Teasdale also accepts that the Interested Party is entitled to make submissions about the costs of assessment.

Mr Teasdale avers there is a route to “cut through all this”, because BCR Legal Assist Limited were joined as a party to these proceedings and subsequently pursued arguments in their own name with their own representation.

He endorses Mr Waszak’s assertions that these are not arguments for a non-party costs order. Mr Teasdale also argues there is no need for a real party test because BCR Legal Assist Limited are a party to the proceedings.

In this regard, he submits that BCR Legal Assist Limited were not “acting behind the scenes” and instead “inserted themselves and actively participated”, stating that the barrister acting for BCR Legal Assist Limited at the 23 September 2025 hearing was not acting for the 2^nd and 3^rd Claimants.

Mr Teasdale avers that BCR Legal Assist Limited intervened in their own name and for their own benefit, and as a consequence caused the Defendants to incur additional costs.

Mr Teasdale invited me to consider the position had the Interested Party won and submits that in such a scenario they would have sought an order that their costs be paid. He therefore queries why the Interested Party could then escape any responsibility for payment of costs where they lost.

Mr Teasdale referenced the consent order sealed on 14 August 2025, which added BCR Legal Assist Limited as an interested party. He observed that the order did not contain any costs caveats as to the Interested Party’s involvement, because they became a party who could become liable to recover or pay costs.

As far as the Defendants understand the application of the 2^nd and 3^rd Claimants, the application is not brought because BCR Legal Assist Limited is the de facto ATE insurer, but rather because they are a party.

Mr Teasdale suggests that all that needs to happen now is the making of an order that costs follow the event, the event being settlement of the 2^nd and 3^rd Claimants’ liability for costs at a level above any offers made by or on behalf of the paying parties, and 100% of the fault for a failure to settle costs being at the feet of the Interested Party.

Mr Teasdale then set about explaining where he considered there were gaps in the chronology explained by Mr Waszak, firstly citing the Defendants’ Part 36 offer dated 9 November 2023, and an e-mail from Joanna Rhodes of Gowlings to Graham Shaw (BCR Costs Limited) and Blake Weltman (BCR Legal Group Limited) dated 15 November 2023 (which was not in the bundle but a copy handed up during the hearing). Mr Teasdale avers this e-mail provides a clear steer of the approach that Gowlings wanted to adopt.

Mr Teasdale confirmed that formal service of the bill of costs was affected on 27 June 2024, accompanied by a Form N252 Notice of Commencement, and met with points of dispute that contained errors and “bad points” he submits Gowlings simply would not have made.

Mr Teasdale argued that the “BCR drafted points of dispute” partly amounted to argument that the Claimants agreed a budget that they should not have done, and made arguments which were beyond the scope of that covered by the 1^st Claimant.

Mr Teasdale then cited Withers’ letter dated 1 November 2024 as an example of the Defendants’ frustration at a lack of negotiation or progress, saying that the letter took issue with the Interested Party’s failure to engage with the offers made or make proposals of their own.

Mr Teasdale developed his argument that if the points of dispute prepared by the Interested Party were indeed unreasonable, then how could the court draw a conclusion that those very same unreasonable points of dispute caused the Defendants to voluntarily make a proposal to accept a further reduced sum.

Mr Teasdale therefore echoed Mr Waszak’s criticism of the £600,000 offer as being unrealistic and unsupported by the points of dispute.

Mr Teasdale repeated that BCR Legal Assist Limited had become a party in its own right in these proceedings, and that was something that all consented to.

Mr Teasdale then cited an e-mail from Freeman Harris to Laura Mattar (Withers) and Catherine Naylor (Gowlings) dated 20 August 2025 which proposed the preliminary issues to be addressed, and noted in particular paragraph 3 of the same which stated:

“3.

Is the Interested Party bound by any agreement or concession made by the Claimants as to the level of the Defendants costs?”.

Mr Teasdale submits this is as clear an indication as any that BCR Legal Assist Limited was not standing in the 2^nd and 3^rd Claimants’ shoes, but in fact “concerned for their own pockets”.

Mr Teasdale then cited the response from Withers (also dated 20 August 2025) in which their Laura Mattar observed:

“3.

The issue before the court is the quantification of the costs for which the Claimants are jointly and severally liable. It has nothing to do with BCR's own legal position. This issue is not pleaded or relevant and has been raised very belatedly.

If argument is to be made on this, please set out properly what your position is. If BCR are seeking to argue it is not bound by any agreement or concession, please confirm exactly what you suggest they should not be bound by. We will then consider inclusion of this issue.”

Finally, citing Freeman Harris’ response of 21 August 2025, Mr Teasdale invited me to note their stance that “In respect of [proposed] issue 3, our client is an Interested Party. We will be asking the Court to determine this issue.”

As to the position the 2^nd and 3^rd Claimants found themselves in, Mr Teasdale invited consideration of the Joint Trustee’s e-mail dated 3 September 2025 in which the trustee, David Fairclough, served a Notice of Change on behalf of the 2^nd and 3^rd Claimants that they would be progressing as litigants in person, observing that:

“Given the way in which Freeman Harris' client has taken conduct of these proceedings, Cs2&3 are being prevented from following advice given to them by their chosen legal representatives. As such, they no longer require a firm of solicitors on the record.”

The trustee’s e-mail also explained that the 2^nd and 3^rd Claimants would be instructing a direct access barrister to attend the preliminary issues hearing but adopt a neutral (i.e. non-participatory) position at the hearing.

Mr Teasdale described the need for the 2^nd and 3^rd Claimants to take such steps as “extraordinary”, and demonstrates they were prevented from following the legal advice they had obtained. He also invited me to note that the information was volunteered, such that the Interested Party was well aware of the 2^nd and 3^rd Claimants’ concerns.

Mr Teasdale concluded by acknowledging that settlement in January 2026 occurred in stages but submits that the chain of correspondence ultimately demonstrates that, left to handle matters without intrusion, the Defendants (receiving party) and Claimants (paying party) were capable of agreeing to the disputed costs.

He therefore commends the witness evidence of Ms Mattar and Ms Naylor, and supports the contention that the assessment costs incurred by the Defendants were caused (and therefore should be paid by) the Interested Party.

Mr Nicol began by reminding me that those instructing Mr Teasdale are not a party to this application, and that Mr Teasdale cannot save the shortcomings in 2^nd and 3^rd Claimants’ application through oral submissions today.

Mr Nicol submits that no one, with any certainty, can say the parties would have been better off without the Interested Party’s involvement. On the contrary, he says the Interested Party’s impact was demonstrably positive because following the hearing of preliminary issues, the Defendants’ valuation of their own costs claim came down significantly.

Mr Nicol suggests that the receiving party's basic argument may be condensed down to the suggestion they were better off dealing with the paying party (2^nd and 3^rd Claimants) than the Interested Party.

Mr Nicol reflected that this case concerns a certain set of circumstances in which the ATE insurer had to pay out on behalf of their insured, and where the £1m limit of indemnity looked likely to be exceeded (and indeed it was).

He says that in those circumstances, the Interested Party simply stepped in to act in place of rather than instead of the paying party with regard to costs negotiations.

Observing that the Notice of Commencement is dated 27 June 2024, with points of dispute due by 18 July 2024, Mr Nicol cited that the 1^st Claimant’s points of dispute were not served until 13 August 2024 and thus not all of the alleged delay could be laid at the feet of the Interested Party.

Mr Nicol also cited that the 1^st Claimant’s points of dispute were only 3 pages long, raising only 2 points. He queries how the Defendants can sustain a position that the points of dispute prepared by BCR Legal Costs had no impact on costs negotiations when it was only after the service of those points of dispute and the preliminary issues hearing that the Defendants drastically altered their position.

Mr Nicol submits that I should be slow to dismiss the £600,000 Part 36 offer (advanced on behalf of the 2^nd and 3^rd Claimants) as “absurd” without judicial consideration of the points of dispute prepared by BCR Legal Costs (see B620).

Mr Nicol considers the offer of £600,000 to be “perfectly proper” and supported by the argued points. He argues that the points of dispute, and the Interested Party’s approach, “reaped rewards” for the paying party – observing that receiving parties don't usually “bid against themselves” (as the Defendants effectively did) and querying why they did, if not for the points of dispute and the preliminary issues hearing?

As to accusations of delay and obstruction, Mr Nicol submits that whilst such accusations are denied, the burden is on the Applicants (2^nd and 3^rd Claimants) to demonstrate the Interested Party’s conduct increased the Defendants’ costs of assessment.

Mr Nicol then cited Withers’ letter to Freeman Harris of 9 April 2026 in which they seek to set out the arithmetic consequences of the Interested Party’s involvement, with which he takes issue.

Mr Nicol relies on paragraph 29 of his skeleton argument and that the starting point is the fact that a payment on account of £957,814 was made in November 2023, and that on 6 January 2026 the Defendants offered to settle their costs as against the 2^nd and 3^rd Defendants for that very same amount.

He reflects that the Defendants’ Part 36 offer of £1,372,005.79 on 9 November 2023 was not framed as an ‘opening offer’ but rather a proper Part 36 offer which set out all of the consequences which would flow from the same.

It was a proposal that sought over £400,000 more than the sum paid on account. Mr Nicol therefore queries the proposition made now, many months later, that the Defendants would have been open to the prospect of accepting a sum much less than the value of their offer.

Mr Nicol also argues that any criticism as to the number of offers made goes both ways. He observed that the Defendants’ Part 36 offer dated 9 November 2023 effectively remained their only offer until they proposed to accept a much-reduced sum.

This is because the Defendants’ later proposal of £1,194,279.14 was not in fact a revised offer, but one which simply accounted for settlement with the 1^st Claimant. Mr Nicol described it as effectively an offer to pay the Defendants a further £236,465.14.

He submits that the Interested Party, to the benefit of the 2^nd and 3^rd Claimants, was entitled to reject that proposal and thereafter pursue a preliminary issues hearing.

He further submits that had leading counsel’s arguments at the preliminary issues hearing found favour with the court, the Defendants would have found themselves in difficulty in supporting the bill served.

Mr Nicol also avers that the Interested Party was not wholly unsuccessful at the preliminary issues stage in any event, and did not act unreasonably in putting forward the arguments advanced.

He thereafter queried how do the Defendants and 2^nd and 3^rd Claimants define “better” in terms of settlement.

Mr Nicol referred me to the ATE policy issued by BCR Legal Assist Limited (and underwritten by Financial & Legal Insurance Company Limited), and in particular the exclusions section of the same. He says the paying party 2^nd and 3^rd Claimants could not breach the insurance policy and at the same time seek the benefit of it.

Mr Nicol then addressed the section of the ATE Policy termed ‘control of the proceedings’ at clause 4.6 which provides:

“At the Coverholder’s request, the Insured shall instruct the Appointed Representative to apply for the Opponent’s Costs to be assessed by the relevant court or tribunal.”

As per clause 1.1 of the ATE policy, the Appointed Representative means “the Solicitor, firm of Solicitors or other appropriately qualified or experienced person named in the Schedule appointed to act for and represent the Insured in the Proceedings.”

Mr Nicol observed that the ATE insurer honoured the full limit of the indemnity and gave the paying party two options in terms of how the balance of the indemnity was to be deployed.

In light of the abandonment of the Section 51 element of the application, Mr Nicol focussed on CPR 47.20, which he referred to as “the gateway to make a costs of assessment order”.

In that regard, he observed that the paying party Claimants and receiving party Defendants have already agreed that the receiving party will have their costs of assessment.

As such, Mr Nicol queries how the Claimants can seek that “the court makes some other order in relation to all or part of the costs of the detailed assessment proceedings” (pursuant to CPR 47.20(1)(b)) when an order as to the costs of assessment has already been agreed between the paying party Claimants and receiving party Defendants.

With further reference to the wording of CPR 47.20(1), Mr Nicol submits that the terminology of “except where” means the exception. He submits there is simply no power under CPR 47.20(1)(b) to make order the Claimants are seeking.

Mr Nicol challenges in any event the argument that the Interested Party’s involvement has made matters worse for the Claimants and Defendants.

He submits a more accurate reflection would be that the Interested Party’s involvement has made matters better for the paying party and worse for the receiving party.

Mr Nicol also observed that the paying party is stuck with paying costs and are indemnified by their ATE insurers to largely cover the paying parties’ costs exposure, up to the full £1m of cover they are entitled to under the policy.

He cites the letter from Freeman Harris to the 2^nd and 3^rd Claimants (dated 12 January 2026) and the options set out therein at paragraph 4 concerning the “£809,023.33 remaining in the total Limit of Indemnity (net of interim payments and legal costs of the assessment but including own costs that you are liable to Gowlings for)”, and the fact that the paying party chose option 4a, being:

“BCR transfers to you the total sum of £809,023.33 and you can either continue with the Costs Assessment yourselves or liaise with the Defendants directly with a view to reaching a settlement but in any event, BCR’s involvement would cease at the point of transfer of funds”.

The alternative was for BCR Legal Costs to accept the Defendants’ proposals on behalf of the Claimants. Mr Nicol submits that in choosing option ‘a’, the paying party accepted the terms of 4a.

In response, Mr Teasdale did not deny the points of dispute and replies had an impact on the ultimate settlement sum, but maintains that the Interested Party’s involvement yielded no sensible settlement proposals. He maintains it was only when Gowlings resumed conduct that a final settlement was achieved.

As to Mr Nicol’s invited interpretation of CPR 47.20, Mr Teasdale submits this is plainly wrong. The Interested Party has lost in the same way the Claimants have lost.

He further observes that CPR 47.20 does not say who should do the paying, and that no category of payer is identified, observing that CPR 47.20(3)(a) refers to “all the parties”.

Mr Waszak handed up copies of the e-mails dated 15 and 20 November 2023, both of which had been erroneously omitted from the hearing bundle, but copies obtained during the course of the hearing.

He otherwise stands by his skeleton argument and oral submissions.

There are some straightforward observations one can make of any detailed assessment process.

A receiving party who has undertaken a reasonable effort to negotiate or chase for a response is not excused from the time limits under CPR 47.7 and CPR 47.14.

If progress is not being made, a Notice of Commencement should be served (in time) and a request for a Default Costs Certificate submitted if points of dispute are not received. In this matter, extensions of time for the service of points of dispute were agreed, and the Defendants are to be commended for such conduct.

Following service of points of dispute, if compromise proves allusive a receiving party should not delay in requesting a detailed assessment hearing.

To put it bluntly, a receiving party must realise when the time has come to cease chasing, cease negotiations, and instead make their best and final offer, have a bill drawn, get it served and set the matter down for assessment.

In so far as it is suggested any delays were caused by the Interested Party, one observes that the Form N258 was filed in January 2025 (i.e. well before the Interested Party was added) and in circumstances where it was a matter of court time-tabling that the length of time required for the substantive hearing (eleven days) meant that the detailed assessment would not take place until February and March 2026. I comment further on delay below.

The 2^nd and 3^rd Claimants have not pursued a non-party costs order (NPCO) application because they likely accept such an application would be unsuccessful.

One cannot ignore that the underlying claim was a Section 423 Insolvency Act 1986 action brought by the Claimants against the Defendants. Those were “the proceedings”.

No cogent argument can be made out that BCR Legal Assist Limited had an interest in “the proceedings” (or part thereof) to the exclusion of the interests of the claimants.

The detailed assessment proceedings in this matter flow from the Section 423 Insolvency Act 1986 action brought by the Claimants against the Defendants under CR-2016-008560, in which the Defendants hold an order for costs in their favour, payable by the 2^nd and 3^rd Claimants.

Detailed assessment in these circumstances is therefore not new proceedings, but in fact part of the existing proceedings which led to the costs order in the Defendants’ favour.

The 2^nd and 3^rd Claimants have firmly nailed their colours to the mast of 47.20.

47.20(1) provides that “The receiving party is entitled to the costs of the detailed assessment proceedings..” (the “usual order”)

It is uncontroversial to describe the CPR 47.20(1) provision that “The receiving party is entitled to the costs of the detailed assessment proceedings” as ‘the usual order’.

The terminology of “except where” acknowledges the notion of an exception to ‘the usual order’, and that exception is set out explicitly as being “where the court makes some other order in relation to all or part of the costs of the detailed assessment proceedings”.

CPR 47.20(1) does not dictate the source or sources of funds a paying party calls on when the sum they are liable for has crystallised, whether by agreement or assessment. CPR 47.20(1) simply addresses which party is entitled to the costs of the detailed assessment proceedings.

Accordingly, the exception must be limited to the question of entitlement, rather than the source or sources of funds once the amount of the entitlement has been concluded.

To put it another way, the ‘usual order’ decides entitlement without dictating how that entitlement is later discharged. Accordingly, any exception to the ‘usual order’ should also be limited to entitlement, and not seek to dictate or concern itself with how that entitlement (once crystallised) is discharged.

The making of “some other order” is a mechanism by which the court, exercising its discretion, may interfere with the “usual order” and is not uncommon.

However, that interference is concerned with whether someone other than the receiving party ought to be entitled to the costs of the detailed assessment proceedings.

In the index matter, the 2^nd and 3^rd Claimants’ application does not seek to upset the “usual” CPR 47.20(1) provision that the “receiving party is entitled to the costs of the detailed assessment proceedings”. Indeed, the draft order served with the 2^nd and 3^rd Claimants’ application provides for payment of the receiving party Defendants’ costs of assessment.

Instead, the 2^nd and 3^rd Claimants are seeking to use CPR 47.20(1)(b) to effectively transfer their liability for the costs the detailed assessment proceedings to the Interested Party. In doing so, they rely on CPR 47.20(3) and seek a wide interpretation of the term “party/parties” within the same.

Ultimately, the detailed assessment is part of the proceedings under CR-2016-008560 - in which the Defendants hold an order for costs in their favour, payable by the 2^nd and 3^rd Claimants (having settled costs with the 1^st Claimant at an early stage).

Detailed assessment proceedings are not a new set of proceedings but rather a procedure that follows where it is impracticable for the originating court to maintain the case for the purpose of assessing costs which the parties cannot agree.

CPR 47.20 cannot be used to alter an existing order for costs. The 2^nd and 3^rd Claimants primary liability to pay the Defendants costs of the main action cannot be reversed or altered, nor do the 2^nd and 3^rd Claimants seek to avoid their liability to pay the Defendants’ costs of the main action.

The Defendants took steps to recover their costs of the main action as a consequence of the costs order in their favour. The Claimants are primarily liable for those costs, but had the foresight to obtain ATE cover to insure against the risk of such a liability arising.

The liability (to pay the Defendants’ costs) having arisen, the 2^nd and 3^rd Claimants take issue with the Interested Party’s conduct (47.20(3)(a)), and invite consideration of the reasonableness of the disputes raised (47.20(3)(c)), such that they invite this court to exercise its CPR 47.20(1)(b) discretion – not to make a different order in terms of who is entitled to the costs of the detailed assessment proceedings, but rather who pays them.

In other words, the 2^nd and 3^rd Claimants agree the Defendants are entitled to the costs of the detailed assessment proceedings, but say they should not have to pay the same.

Mr Teasdale (for the Defendants) argued that CPR 47.20 does not specify a “category of payer”, but rather refers to “all the parties”. In this respect, he argued that CPR 47.20 does not say who should to the paying.

With respect, that is not the subject matter of the application before me. I am required to address the question of who is liable for these costs and the status of BCR Legal Assist Limited in that regard.

I am not at all surprised that CPR 47.20 does not set out to dictate who pays the costs and I consider it telling that Mr Teasdale was unable to take me to any contrary provision in the civil procedure rules.

That is because the rules generally are concerned with who is liable to pay, as opposed to who is ultimately writing the cheques. Indeed, in the very case before me now, the 2^nd and 3^rd Claimants have agreed liability to pay the Defendants’ costs of £957,814.00, plus bill drafting.

They were free to strike this agreement because they were not bound by any contractual restrictions from BCR Legal Assist Limited in agreeing that sum, and thereafter invoked their contractual right to compel BCR Legal Assist Limited to pay out sufficient sums to meet that liability.

In so far that the Claimants invite this court to apply the principles typically considered in a non-party costs order application, I find I would not have found the Interested Party to meet the criteria of an “intermeddler”.

As per Travelers Insurance v XYZ [2019] UKSC 48, I accept that the notion of involvement, as opposed to control, is sufficient. However, I do not consider the Claimants have established involvement which is “wanton or officious”.

As to whether principles associated with “the real party test” might apply, I don’t consider the Interested Party funded or controlled the proceedings.

There is no evidence I have been taken to which leads me to conclude that the Interested Party was exercising any form of “control” over the 2^nd and 3^rd Claimants. Indeed, the conduct of the Claimants at the time does not lead me to conclude that even they thought they had lost control of the proceedings.

Further, when one obtains any form of insurance, payment out on a policy to cover liabilities is not the same as some form of outside or 3rd party funding arrangement. The policy holder, in this case the 2^nd and 3^rd Claimants, have paid for insurance and therefore utilising the limit of an indemnity they paid for the benefit of meant that the 2^nd and 3^rd Claimants were the funders, not the Interested Party.

Where Mr Teasdale (for the Defendants) speaks of winning or losing the preliminary issues hearing, he neglects to acknowledge that a preliminary issues hearing in a detailed assessment is a matter of convenience and time management of the court’s resources.

Further, his arguments in this regard rely on the premise that the starting point is that the Interested Party is a ‘real party’, and that the points of dispute (and in particular the preliminary issue taken) was for the sole benefit of the Interested Party.

I disagree with Mr Teasdale’s characterisation of how the court would ordinarily address the liability for the costs of a particular point of dispute raised and heard. This was in relation to Mr Teasdale’s argument that the Interested Party would have sought their costs of the preliminary issues hearing had the point raised been accepted by the court.

The reality is that had the court found against the Defendants at the preliminary issue hearing, that would not necessarily have meant an end to the detailed assessment. It would have been premature to make any orders as to the costs of assessment, and until such time the parties compromised by agreement, the detailed assessment was scheduled to continue.

Further, the fact the assessment was not scheduled to immediately continue does not present an opportunity to hive off a selected element of the wider points of dispute and thereafter make a costs order based on the de facto winner of an individual point.

As both expert costs counsel know, it is not at all uncommon to win and lose various points during the course of a detailed assessment but it is the overall result that matters, when contrasted with offers (if indeed any were made) and factors such as conduct.

A detailed assessment does not stop for there to be a summary assessment of the costs of every single point taken. Instead, when a CPR 47.20 order is being made, either party may ask the court to exercise its discretion as to any particular item claimed or point taken.

In that regard, i.e. Mr Teasdale’s argument that success at the preliminary issue hearing would have led to the Interested Party seeking a costs order in their favour, I reject the argument because no costs order would have been made simply on the basis of the de facto winner and loser of just one of many points of dispute raised. The order for costs of assessment is dictated by the overall result.

Thus, when having “regard to all the circumstances”, I am not persuaded that the principles which would apply to consideration of intermeddlers and real parties have any relevance to the facts and circumstances of the index matter.

CPR 47.20 confers a discretion on the court to make “some other order in relation to all or part of the costs of the detailed assessment proceedings”.

Whilst the rules in this regard likely envisage that “some other order” might recognise circumstances in which the receiving party could be deprived of all or part of their costs of assessment, or for the making of orders for recovery of the paying party’s costs of assessment, I agree with Mr Waszak that the rule is not drafted in such restrictive terms that it could not be applied to an interested party. In doing so, I recognize that CPR 47.20(3) does not set out an exhaustive list of factors to consider, but rather certain common factors.

However, I do consider CPR 47.20 is very much geared toward consideration of the conduct of the parties to a claim.

It is the Defendants’ bill only which was subject to detailed assessment proceedings, and reduced by agreement (following a preliminary issue hearing). Consideration of the reasonableness “to claim the costs of a particular item” applies to the Defendants only, and items were disputed on behalf of the 2^nd and 3^rd Claimants.

In so far as Mr Waszak argued that “the Interested Party controlled and funded the detailed assessment proceedings”, I refer to my comments above. The Interested Party’s involvement is a direct product benefit of an insurance policy the 2^nd and 3^rd Claimants purchased. Any benefit derived in such circumstances does not amount to a transfer of who is funding and/or controlling the proceedings.

Where Mr Waszak made reference to “a number of examples” (of the Interested Party conducting proceedings in an “aggressive and obstructive manner”), I have treated those examples as an exhaustive list because I cannot comprehend why the 2^nd and 3^rd Claimants would have excluded any instances of alleged aggressive or obstructive behaviour given the high-stakes nature of their application.

Mr Teasdale drew my attention to an e-mail from Gowlings to two divisions of BCR, dated 15 November 2023, which was in response to the Defendants’ Part 36 offer of 9 November 2023. The e-mail attached a “further breakdown” from Withers and set out 6 sub-headings which sought to summarise various factors that could have an impact on the agreement or assessment of costs.

Gowling’s e-mail concluded with:

“We would like to respond with a counter-offer that is realistic and which puts [the Defendants] under severe pressure from the perspective of incurring further costs of preparing for a detailed assessment.”

It was that e-mail which prompted the involvement of Graham Shaw of BCR Costs Limited, some five days later, to take over conduct of negotiations concerning the Defendants’ costs.

As to the content of the points of dispute, I am perplexed by the notion that Mr Teasdale (for the Defendants) considers he can speak as to the minds of what the 2^nd and 3^rd Claimants, and/or Gowlings, would have argued had they assumed responsibility for the preparation of points of dispute. It seems to me that is opinion and speculation at best, and certainly not persuasive.

Further, it is not clear to me what errors or bad points Mr Teasdale speaks of in any event. In this regard, I have reviewed my judgment dated 18 November 2025, the parameters of which were “the relationship between the rules governing costs budgeting, the orders made following two costs management hearings, and the subsequent detailed assessment of the receiving party Defendants’ costs”.

The parties will be aware I recorded no comments as to the merits of the points taken, and of relevance is the fact I made no findings that the points lacked merit, were fanciful, hopeless or any other form of words which might indicate the court’s dissatisfaction with a point or points taken.

This is because the issues raised identified legitimate areas of doubt which required judicial interpretation and decision. They were points that were legitimately taken against the Defendants and may well have found favour with a different judge.

I observe that in finding for the Defendants on the discrete preliminary issues addressed, my concluding comments were:

“81.

This preliminary issue hearing was not the result of a standalone application but rather for the benefit of the parties in so far as it was indicated that resolution of points regarding the status of the October 2022 and January 2023 orders might assist inter partes negotiations.

82.

At this stage, the parties may simply record that the costs of this step are “Costs reserved”. No separate order will accompany this judgment.

Those comments were an explicit explanation that the preliminary issues heard were simply part of the detailed assessment.

The detailed assessment of course did not continue on 25 February 2026. The Defendants and 2^nd and 3^rd Claimants would have it that between the handing down of the 18 November 2025 judgment and 6 January 2026 nothing in the points of dispute or the judgment dated 18 November 2025 had any influence on the Defendants’ stance on costs.

The Defendants and 2^nd and 3^rd Claimants would have it that it was solely the resumption of Gowlings as the 2^nd and 3^rd Claimants point of contact which was the reason the Defendants dramatically elected to settle their costs for the sums already paid on account.

I do not agree. It is not for me to speculate or grade which of the points of dispute caused the Defendants concern, but coupled with the comments I had made during the course of the preliminary issues hearing, the Defendants were clearly sufficiently concerned that their previously expressed determination to proceed to assessment gave way to a resolve to bring the assessment proceedings to an immediate and abrupt end.

Regarding the Interested Party making enquiries as to the impact on them as to agreements struck between the Defendants and the 2^nd and 3^rd Claimants, I do not agree this amounts to the Interested Party simply being “concerned for their own pockets”.

As the ATE insurer of the 2^nd and 3^rd Claimants, the Interested Party had a legitimate interest as to their financial liability, and whether the limit of the indemnity would likely be exhausted.

In so far as Mr Teasdale argued that the 2^nd and 3^rd Claimants were “prevented from following the legal advice they had obtained”, I simply fail to see how this is the case. I do not recall being taken to any evidence of the Interested Party acting against the 2^nd and 3^rd Claimants’ will.

I do accept that there was clearly some frustration by the Interested Party as to why the Claimants would agree to a Defendant budget which, if liability to pay arose (as indeed it did), was capable of, or likely to, exceed the ATE indemnity limit. However, any such dispute (as between policy holder and provider) is and was not an issue for detailed assessment.

The substantive point being taken was a question of the interpretation of a costs management order, and as a consequence the relevance of that order to a detailed assessment, to include comments recorded by the judge who made the costs management order.

Whilst Mr Nicol is correct to observe that the Interested Party was entitled to act in its own best interest, the reality is the best interests of the Interested Party and the 2^nd and 3^rd Claimants were mutual and aligned.

Further, notwithstanding the clearly expressed frustration at the Claimants for agreeing a Defendants’ budget that exceeded the ATE indemnity limit, the purpose of the preliminary issues raised in the points of dispute was not some form of stealth attack by the Interested Party on its own insured, but instead the raising of arguments intended to release the Claimants from the straitjacket they had placed themselves in by agreeing the Defendants’ budget without seeking any reduction at all – a decision which inevitably influenced the size of the detailed bill of costs submitted for assessment, and exposed the Interested Party and the Claimants to great costs exposure risk that had the Defendants’ budget been subject to negotiation or challenge.

Having concluded that there are no viable arguments for the making of some other order pursuant to CPR 47.20(3)(c), because I do not consider any of the points of dispute cited were unreasonably taken, I am left to consider CPR 47.20(3)(a) conduct.

The 2^nd and 3^rd Claimants, supported by the Defendant, raise conduct under a number of headings, each of which I address below.

It is rather curious, given he is instructed by the paying parties, that Mr Waszak suggests the receiving parties’ offer of 9 November 2023 was “made in the hope (and expectation) that even if not capable of acceptance it would initiate negotiations” because that is only something that the author of that offer can speak to.

The fact it took BCR Costs Limited “almost” two months to respond to that offer to advise that sight of a bill was requested amounts to something of a delay. However, under consideration was the question of whether to accept an offer approaching £1.4m, which is not a straightforward task. I also observe that the relevant period includes the festive break during which time staff absences play a part in response times.

In any event, I am not critical of any party who requests sight of a detailed bill of costs in order to be able to assess whether to accept or reject an offer of such proportions, and in all the circumstances I do not consider this amounted to an unreasonable delay, as alleged.

As to the response time to the service of a draft bill of costs, it is something of a stretch for the Defendants to say that any delay was caused by either the paying party Claimants or the Interested Party.

The draft bill was sent on 24 April 2024 and Withers said they would commence detailed assessment on 17 May 2024 if negotiations had not progressed before that date. 2 days before that deadline expired, Mr Shaw of BCR Costs Limited explained he was awaiting instructions but that should not delay the Defendants in formally serving a notice of commencement if they were so minded.

In response, Withers extended the deadline for negotiations to 27 June 2024 and ultimately served a notice of commencement and bill on that date.

Mr Waszak presents the whole chain of events as an “8 month delay, caused entirely by waiting for BCR Costs Limited.”.

My observation is that none of the parties were forced or compelled to wait. It was entirely within the receiving party’s gift and control to commence detailed assessment proceedings as soon as they wanted to once an order for costs in their favour had been secured.

In any event, where a substantial and detailed bill has been served it is not uncommon to agree extensions – for the bill drafting, the points of dispute and the points of reply. For example, service of points of dispute by the 1^st Claimant took place nearly 4 weeks after they were due.

Further, where cashflow has been aided by a payment on account, it is not uncommon for a receiving party to pursue their costs with less gusto than when they are completely out of pocket until the costs are agreed or assessed.

In all the circumstances, I do not consider that the 2^nd and 3^rd Claimants have made good on the allegation of an “8 month delay, caused entirely by waiting for BCR Costs Limited”.

BCR Costs Limited may have contributed to that delay by asking for more time to respond, but ultimately it was the Defendants as receiving party who were always in control of when detailed assessment proceedings were commenced, and when a detailed assessment was requested.

Further, and relevant to the question of the future assessment of the costs of assessment, one would have expected the costs incurred by the Defendants during any periods of delay to have been minimal.

With regards to Mr Waszak’s citing of an argument to disallow counsel’s fees and professional bundling fees (described above) as an example of overly aggressive, ambitious and hopeless points of dispute, I again query why in such a high-stakes application the 2nd and 3rd Claimants would neglect to cite other examples.

It is not apparent to me that there are in fact other examples, nor can I see how the points of dispute referenced could be described as “overly aggressive and ambitious”. It may well have been hopeless, but “hopeless” objections ought to be capable of swift dismissal via a succinct reply and at little cost.

The starting point is the service of a bill of costs in the sum of £1,655,531.11 (N252 dated 27 June 2024), £241,804.59 of which was claimed against the 1^st Claimant.

Prior to formal service of the bill, the Defendants made a Part 36 offer to settle costs against all three Claimants at £1,372,005.79 on 9 November 2023 (reiterated on 24 April 2024).

After settlement with the 1^st Claimant (in the sum of £150,000), the Defendants’ offer was revised to £1,194,279.14 (as against the 2^nd and 3^rd Claimants only).

To describe the proposal of £600,000 as “absurd” or unrealistic ignores the factual reality of how much the Defendants ultimately accepted (as against all three Claimants) as compared with the amount claimed.

The Defendants ultimately settled the 2^nd and 3^rd Claimants’ liability for costs against the bill at £957,814. Simple arithmetic dictates that settlement was therefore achieved at £357,814 more than the offer of £600,000.

If one then contrasts the sums the Defendants accepted with the sums being claimed, the offer of £600,000 can be no more “absurd” than the sums claimed.

The reality is thus. The Defendants claimed costs of £1,655,531.11. That sum is not “absurd” but rather it represents the amount the Defendants were liable to pay for the legal services received, inclusive of disbursements and applicable VAT.

The Defendants chose to accept sums against all three Claimants combined of £1,107,814.00 as against the bill as drawn, no doubt for reasons of commerciality and in recognition of risks they had identified on an inter partes assessment of costs.

In that context, the offer of £600,000 (as against the £957,814 agreed) is neither absurd nor unrealistic. It represents a considerable amount of money, and was consistent with the arguments being run with regards to the interpretation of orders concerning budgets in this case, along with the balance of objections raised. It was a genuine offer to settle.

If one adds £600,000 to the £150,000 which had been agreed with the 1^st Claimant, it amounts to £750,000.

The global settlement sum of £1,107,814.00 is far closer to £750,000 than it is to the N252 total (£1,655,531.11).

Further, the fact an offer is less than a payment on account does not render that offer worthy of ridicule nor automatically render the offer unrealistic. For the avoidance of doubt, I do not consider the offer of £600,000, when looked at in its proper context, could reasonably be described as “absurd”.

It was a real and genuine offer to settle.

Much of the comment in Ms Naylor’s 27 February 2026 witness statement is in my view, respectfully, speculative. Whilst Ms Naylor is no doubt in a position to speak authoritatively on matters such as corporate commercial litigation, civil fraud, asset recovery and insolvency, it is not at all apparent to me how Ms Naylor can make good on the claim that “Absent BCR’s involvement, the question of costs would have been resolved at an early stage and these Proceedings would not have been necessary”.

Ms Naylor’s witness statement invites this court to make the order sought by the 2^nd and 3^rd Claimants, based on “(i) BCR's conduct; and (ii) the amount by which the costs have increased as a result of that conduct”.

However, I don’t consider the evidence presented makes good on such allegations. The 2^nd and 3^rd Claimants’ evidence is speculative, relies heavily on inference, is unproven, and in any event inconsistent with the timeline (whereby it seems I am otherwise being invited to accept that the mere resumption of Gowlings as the point of contact for the 2^nd and 3^rd Claimants led to a compromise being struck).

I acknowledge that correspondence between Withers and Gowlings, particularly in November 2023, demonstrate a brief period in which they were demonstrably working progressively together to resolve all matters relating to costs.

However, to extrapolate that brief period into a cast-iron conclusion that had Gowlings retained conduct of the costs negotiations, the costs of assessment would have been dramatically reduced, requires a considerable leap of faith by this court where the outcome argued for is not only to make BCR Legal Assist Limited a paying party, but also that they make a 100% contribution.

It would also require me to accept that the level of reduction agreed by the Defendants to their bill would have been achieved absent any input from BCR Legal Assist Limited / BCR Costs Limited.

Nowhere have I seen any evidence to the effect that the mere resumption of Gowlings’ conduct of costs negotiations caused the Defendant to advance settlement proposals that would otherwise have never been advanced.

The Defendants’ concern, as with any receiving party facing a lengthy detailed assessment hearing, was to weigh up the risk of proceeding to the full detailed assessment hearing and whether the sums already paid on account were in fact sufficient in the face of that risk.

There is no evidence that the weighing of that risk was contingent upon whether Withers were negotiating with Gowlings or Freeman Harris / BCR Costs Limited.

I am not persuaded by Ms Naylor’s “genuine belief” concerning her hypothetically expressed views as to how costs negotiations might have progressed had Gowlings maintained conduct of the same to the complete exclusion of BCR (in any of their incarnations).

I consider the comments in Ms Mattar’s 2^nd statement (27 February 2026) to be equally speculative, unevidenced and heavily reliant on inference or speculation.

Whoever was negotiating on behalf of the 2^nd and 3^rd Claimant, or conducting costs litigation on their behalf, they had a duty to interrogate the Defendants’ costs and seek to achieve reductions.

It is clear to me that by producing points of dispute (which I consider were mutually beneficial to the 2^nd and 3^rd Claimants and the Interested Party), and running arguments (albeit not wholly successful), the Interested Party’s involvement has played a central role in convincing the Defendants to come down significantly from the sums they were originally seeking.

The Defendants, who purport to be neutral as to the outcome of this application but supportive of the 2^nd and 3^rd Claimants making of the application, make no suggestion whatsoever that they would have belatedly accepted settlement in the sum of the payment on account absent any points of dispute or the running of arguments to the preliminary issues hearing.

There is a clear link, as is so often the case in detailed assessments, between the drafting of points of dispute / running of certain points and subsequent compromise.

Freeman Harris wrote to the 2^nd and 3^rd Claimants on 12 January 2026, opening the letter with “As you know, we act for BCR Legal Assist Limited (“BCR”), your ATE insurer in respect of the above-mentioned”.

There is no dispute whom Freeman Harris are instructed by, and that Freeman Harris does not hold a direct retainer with the 2^nd and 3^rd Claimants. It is in this context that during the period of Freeman Harris’ active involvement, they did not seek to advise the 2^nd and 3^rd Claimants, but rather set out the options available to them whilst making it clear that the 2^nd and 3^rd Claimants would be best served by seeking their own independent advice.

In this regard, I consider that Freeman Harris’ 12 January 2026 letter simply communicated to the 2^nd and 3^rd Claimants the fact of the offer received; explained the implications of my judgment dated 18 November 2025; set out two options as to what the 2^nd and 3^rd Claimants wanted BCR Legal Assist Limited to do with the remaining £809,023.33 left under the policy; and suggested that the 2^nd and 3^rd Claimants obtain their own legal advice as to the Defendants’ latest proposal (being the offer to settle in the same amount as the payment on account, plus the cost of having a bill drafted and costs of assessment).

The 12 January 2026 letter also frankly explained that the Interested Party had concluded the prospects of reducing costs to below £1m were now so low, they accepted that the full limit of indemnity (i.e. £1m) would be exhausted.

In effect, this meant that the ‘incentive burden’ had shifted from the Interested Party to the 2^nd and 3^rd Claimants. What I mean by that is where an ATE insurer’s policy is activated to release funds to meet an adverse costs order, the incentive for the insurer is for those costs to be as far below the indemnity limit as possible.

Once it is clear the indemnity limit is going to be exhausted, anything above the level of indemnity will be the personal liability of the policy holder and the incentive then is to limit the amount by which the indemnity limit is to be exceeded. Hence the ‘incentive burden’ shifts.

The response to Freeman Harris’ letter dated 12 January 2026 came from Grant Thornton, on behalf of the 2^nd and 3^rd Claimants, with a request for “transfer [of] the remaining balance under the Limit of Indemnity to the client account of Gowling WLG (UK) LLP” and “The trustees will then liaise with Withers LLP in relation to the Offer…”

Shortly afterwards, Gowlings resumed costs negotiations and in a 15 January 2026 e-mail from Gowlings to Withers, Ms Naylor set out that 2^nd and 3^rd Claimants were “hoping that agreement can be reached on paragraphs 5(b) and 5(c) of your letter. The complicating factor is that they are not yet in funds from the insurer to meet any costs figure; and Freeman Harris have confirmed this afternoon that the funds have been requested but that it might take up to 28 days for them to be received into our client account. We have asked for this to be expedited if possible.”

The references to paragraphs 5(b) and 5(c) relate to the bill drafting fee and costs of assessment. The same e-mail goes on to state:

“Conscious that the critical element is being able to release the court time / avoid the costs of brief fees/preparation, can we please therefore adopt the pragmatic suggestion in paragraph 8 of your letter that we agree now to paragraph 5(a) and (for now at least) keep only the first day of the hearing on 25 February in the event that this is needed to determine the costs liability.”

The net effect of Gowlings’ 15 January 2026 e-mail was to accept £957,814 as payable against the served bill, and leave over the costs of bill drafting and costs of assessment to be assessed if not agreed.

It does not appear there was any categoric conclusion, as between Withers and Gowlings, as to who would pay the costs of assessment. However, the subsequent proposed order addressed such issues in part.

The proposed order references “the Remaining Period of the Bill” (being the costs of bill drafting), such that total agreed sum is £1,011,135.40 and “2. Giving Credit for the sums previously paid on account, the 2nd and 3rd claimants shall pay the defendants the sum of £53,321.40 (inclusive of any interest).”

It is important to note that despite the limit of indemnity being £1m, the 2^nd and 3^rd Claimants are not seeking that the Interested Party meet the £11,135.40 in excess of the indemnity limit.

This demonstrates, implicitly at least, that the 2^nd and 3^rd Claimants acknowledge their primary liability to meet adverse costs in excess of £1m where the level of indemnity is otherwise insufficient to cover those adverse costs.

In terms of how the 2^nd and 3^rd Claimants’ liability to the Defendants was to be discharged, it does not appear to me that BCR Legal Assist Limited, at any time, sought to avoid their contractual liability to indemnify the 2^nd and 3^rd Claimants. BCR Legal Assist Limited have paid out sums totalling £1m in satisfaction of that contractual liability.

It is also important to note that the proposed order accepts, in the first instance, that the 2^nd and 3^rd Claimants be liable to “pay the Defendants’ costs of the detailed assessment proceedings, summarily assessed on [a basis to be determined by the court]..”.

However, part of the 2^nd and 3^rd Claimants’ argument is that “BCR” (the proposed order is vague as to which division of BCR is intended) should also be liable for the Defendants’ costs of assessment.

The proposed order goes on to seek:

“As against the Defendants, the Second and Third Claimants are jointly and severally liable with BCR for the costs in paragraph 3. However, as between the Second and Third Claimants and BCR, BCR shall be liable (inter se) to pay a 100% contribution towards that liability.”

I have considered Withers’ 9 April 2026 letter to Freeman Harris and make a number of observations regarding the same.

The letter, in effect, sets out the Defendants’ opinion as to the impact of the Interested Party becoming involved in the costs proceedings.

It begins, concerningly, with conformation that as of 1 November 2024 the Defendants’ costs of assessment were already £60,000.

The letter proceeds to describe the incurrence of a staggering “over £160,000 in legal fees (inc. VAT) on the detailed assessment primarily on the hearing in September 2025”. Withers goes on to describe that as “a hearing your client unequivocally lost.” and that “If your client had accepted, as they should have done, that the Orders of ICC Judge Jones were binding Costs Management Orders (as both Withers and Gowling agreed they were during the proceedings) that this hearing could have been avoided entirely.”

Withers’ 9 April 2026 letter then sought to criticize the Interested Party for “not [making] an offer to settle the proceedings notwithstanding the comments of Mr Shaw and Mr Bacon KC at the hearing directly to Costs Judge Nagalingam that a judgment would open up settlement discussions "either way".”

Thereafter unhelpful and accusatory language was adopted, where Withers state “Your client had zero intention of settling these costs proceedings, seeking instead to wear down our client, an elderly woman who had already been embroiled in 10 years of litigation and obviously without the financial means of an ATE insurance provider. It is our view that your client improperly wielded the strength of their financial position against our client.”

I consider that the stance adopted in the 9 April 2026 letter ignores a number of factual realities.

Firstly, the preliminary issue hearing was part of the detailed assessment. The fact it took place earlier than the other listed dates was due to a function of court management.

The court’s experience shows that in cases where a preliminary issue/s arises it is often the case that the parties will compromise once the judge’s decision on the preliminary issues is known. For example, if a consecutive 10 working days have been listed, and the preliminary issues are decided at end of day 2, the business of the court is not best served by a settlement on day 3 unless the remaining 7 days can be assigned to other court users.

The reality is very few court users will be in a position to attend court at such short notice. Thus, the practice of listing a preliminary issues hearing and later dates in the event the matter does not settle is well established. However, it does not change the fact that a preliminary issues hearing is still part of the detailed assessment.

Secondly, Withers fail to adequately explain what they mean by “wearing down”. This is not a case of a paying party ‘chipping away’ with multiple offers. Indeed, the Defendants’ criticism is that the paying parties did not make more offers. Further, no evidence has been presented to support such an assertion.

If a paying party is not making sufficient offers or hampering progress, the solution is to get a bill drawn, formally serve the bill, and set it down for assessment. The receiving party is in control of the process because they can apply for a default costs certificate if points of dispute are not served in time.

Withers then assert that their decision to reduce their position from seeking to £1,194,279.14 (Part 36 dated 1 November 2024) to offering to accept £957,814 had nothing to do with the Interested Party’s points of dispute nor the outcome of the preliminary issues hearing.

Instead, they say “our client won that [preliminary issue] hearing. It was in the face of your client's abject refusal to engage in settlement correspondence that our client reluctantly made the decision to bid against herself in her 6 January 2026 offer. “

The letter goes on to set out:

“Secondly, as was made clear in our correspondence of 6 January 2026, our client agreed to accept the sum of £957,814 but this was not inclusive of any costs, including the Bill Preparation costs (in our 6 January letter stated as £40,390 but which were actually higher, in the sum of £53,321.40) or the costs of the detailed assessment proceedings, which we sought in addition. The total sought at that time was therefore £957,814 + £211,244.20 + £40,390 = £1,209,448.20.

Our Part 36 offer of £1,194,279.14 [as against the 2^nd and 3^rd Claimants only] made on 1 November 2024 expressly included the Bill Preparation costs, interest to the end of the Relevant Period of nearly £18,000 and VAT but did not include our costs. Our costs at that time were approximately £60,000 (inc. VAT). The total offer, as of 1 November 2024, was therefore equivalent to 1,194,279.14 + £60,000 = £1,254,279.”

The Form N252 Notice of Commencement in this matter is dated 27 June 2024, notwithstanding that the order for costs is dated 18 October 2023. Had the bill been served in time (i.e. within 3 months of the order giving rises to costs) and a request for assessment made in time thereafter (i.e. within 6 months of the order giving rise to costs), the Form N258 would have been filed on 18 April 2024.

The court has a discretion to disallow interest for periods of delay in commencing and setting down for detailed assessment.

The Defendants’ evidence is that as of 1 November 2024, they were willing to accept a figure of around £1,116,279.14 as against the bill. That figure is still £158,465.14 more than the bill sum eventually accepted and assumesno disallowance of interest for periods of delay, and further assumes recovery of £60,000 worth of costs of assessment. Thus in reality, even adopting a conservative approach, the Defendants still came down by a figure likely to well exceed £160,000 in real terms.

The consent order terms adding the Interested Party were that “UPON the Court listing the Preliminary Issues hearing on 23 September 2025..”, BCR Legal Assist Limited were added as an Interested Party.

The consent order terms thus explicitly recognised that prior to 14 August 2025, BCR Legal Assist Limited were not a party. Given that the 2^nd and 3^rd Claimants are not pursuing a NCPO application, their argument is therefore that not only can the Interested Party now be made a paying party, but also that they should be responsible for all costs of assessment before 14 August 2025.

As to post 14 August 2025 costs, one must consider what the order actually provides for. It was for ‘BCR Legal Assist Limited’ to be “added as an Interested Party” and in fact sets out restrictions on BCR Legal Assist Limited, in terms what the Interested Party was authorised to do. Given those restrictions apply to BCR Legal Assist Limited in their capacity as Interested Party, they cannot be retrospective to their status when they were a non-party.

The preliminary issues hearing was already listed by 14 August 2025 (Notice of Hearing dated 3 June 2025). In advance of the preliminary issues hearing the Interested Party was authorized to:

“a.

Serve and file written submissions relevant to the issues before the court.

At this point, the “BCR drafted points of dispute” had already been prepared, and served on behalf of the 2^nd and 3^rd Claimants. As to attendance and participation being “limited to matters affecting the Interested Party’s interest”, that does not mean that the Interested Party’s interests and the 2^nd and 3^rd Claimants were not mutual. In fact, they were.

The authority giving rise to costs in this matter is dated 18 October 2023, under case number CR-2016-008560. BCR Legal Assist Limited did not become an interested party until 14 August 2025, following an order made by consent almost 2 years after the Defendants had secured a costs order in their favour from the Claimants.

Where BCR Legal Assist Limited did have an interest, it was in reducing their contractual liability to a sum below the £1m of indemnity provided under the policy they had issued.

That was not an interest which made an opponent of the 2^nd and 3^rd Claimants. BCR Legal Assist Limited’s interest was to reduce the Defendants’ costs to the lowest sum practicably feasible. The benefit to the 2^nd and 3^rd Claimants and BCR Legal Assist Limited was mutual in that regard.

The preliminary issues hearing dated 23 September 2025 raised questions about costs budgeting. Of that hearing, Freeman Harris, on behalf of BCR Legal Assist Limited, opined on 12 January 2026 that “if the Judge had found for us, then there was a real chance of the Defendants’ costs being assessed down to the region of £350,000 to £600,000.”

I consider the reference to “us” in that letter to mean the 2^nd and 3^rd Claimants and the Interested Party collectively, because any agreement or assessment of costs below £1m would have achieved the dual effect of reducing the Interested Party’s contractual contribution, and extinguished the 2^nd and 3^rd Claimants’ liability to meet any adverse costs from their own pockets.

Thus in reality, were I to adopt NPCO principles to decide whether to exercise my CPR 47.20(1)(b) discretion (with reference to CPR 47.20(3)), I would be unable to conclude that BCR Legal Assist Limited was interested in the adverse inter partes costs negotiations to the “exclusion of the interests” of the 2^nd and 3^rd Claimants. The reality is their interests were aligned and mutual.

I have reflected whether a conflict of interest arose as between the 2^nd and 3^rd Claimants and the Interested Party, in that if the former were to treat the coverage of £1m as something of a “war chest” to meet the Defendants’ adverse costs, then they might have an interest in going to their top line figure (i.e. up to £1m) at an early stage to agree costs. That of course would be in contrast with the Interested Party’s desire to argue for and pursue reductions so as to limit their exposure.

However, when one takes into account that an insurance indemnity limit is not a war chest, not a target, but rather the pot from which a liability is paid for once the liability amount has been established, I see no conflict in the work required to establish what that liability amount is – whether by agreement or payment.

Whilst Ms Naylor, at paragraph 10 of her first witness statement, cited the “strong objections by the Applicants” to BCR Costs Limited taking sole conduct of costs negotiations, I do not consider that has been demonstrated by the documents I was taken to.

Mr Wellman’s and Mr Shaw’s communications came across as a polite and respectful request to take over costs negotiations concerning a claim for costs that both the 2^nd and 3^rd Claimants and the Interested Party had a mutual interest in reducing.

For the interested party, the merit ‘bonus’ was to reduce the costs to any sum below £1m (being the argued limit of ATE indemnity cover). For the 2^nd and 3^rd Claimants, the merit ‘bonus’ was to avoid costs exceeding £1m (because they would be liable for any costs in excess of a £1m indemnity limit, absent some other order).

The key question is the extent to which the 2^nd and 3^rd Claimants can demonstrate they were ‘excluded’ from the detailed assessment proceedings, rather than representations being made on their behalf.

The practical reality is that the 2^nd and 3^rd Claimants had an order for costs against them, and unless and until such time proposals were made which the Defendants deemed acceptable then a detailed assessment hearing was inevitable.

The insurance cover available to the 2^nd and 3^rd Claimants was for adverse costs.

Absent the involvement of Freeman Harris and BCR Legal Costs, it would have fallen to the 2^nd and 3^rd Claimants to fund the points of dispute and own costs up to and including a very lengthy detailed assessment hearing.

It seems to me to be uncontroversial that the Interested Party met the costs of preparing the points of dispute, on behalf of their insured, and to the mutual benefit of both the Interested Party and their insured, i.e. the 2^nd and 3^rd Claimants.

The Interested Party also met the cost of engaging leading counsel to argue a point of principle which had the potential to dramatically alter the relationship between the drawn bill and the budgeted costs. I also consider that to be a cost that was met on behalf of the Interested Party’s insured, and to the benefit of both.

Further, notwithstanding the fact that leading counsel’s argument did not find favour with this court, one can at the very least infer that the events leading up to and following the handing down of judgment were sufficiently persuasive that the Defendants dramatically altered their stance on costs – quite unexpectedly offering to accept a sum against the bill equivalent to the sums already paid on account.

The Claimants cannot allege the that Interested Party behaved in an “aggressive and obstructive” manner, nor that the two and half year period referenced was entirely caused by the Interested Party’s conduct, without evidence.

Firstly, it would be very odd for an insurer’s legal arm to behave in an “aggressive and obstructive” manner toward their own insured – hence the importance of actually demonstrating such behaviour.

If, as seems to be the case, this is the 2^nd and 3^rd Claimants’ attempt to articulate the Defendants’ perspective, then I prefer to consider the evidence of the Defendants’ direct experiences of the Interested Party’s conduct. For the avoidance of doubt, I don’t consider the Defendants’ evidence has demonstrated “aggressive and obstructive” conduct on the part of the Interested Party.

Secondly, one cannot blindly accept that the full two and half year period referenced was wholly caused or contributed to by the Interested Party. I have already concluded above that delay is not a persuasive factor in this matter.

The proposition that but for the Interested Party’s involvement, the Defendants’ costs would have been agreed without the need for detailed assessment proceedings, is frankly incredible.

Firstly, it would require both the Claimants and Defendants to demonstrate the circumstances under which the Defendants’ costs would have been agreed without a bill of costs being drawn, or negotiated on the basis of a draft bill only (which would still attract a considerable expense to prepare).

Secondly, it conflates the fact of an offer secured by the Interested Party (and subsequent acceptance by the Claimants) with the offer/acceptance being solely a product of Gowlings re-introduction.

If one considers the relevant timeline dispassionately and objectively, Withers made an unexpected offer to dramatically depart from a position they had adopted for many months, and the Interested Party gave the Claimants the opportunity to obtain advice on that offer and thereafter options to either resume conduct or for the Interested Party to maintain conduct.

In so far as I might have been persuaded to consider if there was a valid CPR 47.20(3)(a) argument as a reason to make “some other order”, I am not persuaded.

There is nothing I have been taken to or heard, in respect of the Interested Party’s conduct, which would have persuaded me to make some other order.

Having considered all the circumstances, I find the 2^nd and 3^rd Claimants’ application lacks merit, and is entirely speculative.

The application is dismissed.

The 2^nd and 3^rd Claimants’ legal representatives present a case as though they were entirely helpless, ignoring the fact that all times up to and well after the making of an order for costs it was the 2^nd and 3^rd Claimants on the record as parties.

BCR Legal Assist Limited were only ever an interested party, recently added (after the main action had concluded), and whose interests are mutual with the Claimants – i.e. to keep the Defendants’ main action costs to as low a figure as possible.

BCR Legal Assist Limited were at all times acutely aware of the fact that if the Defendant’s costs were assessed or agreed at a sum less than £1m, then the ATE insurer stood to save money, and where the figure of £1m was exceeded, it was the 2^nd and 3^rd Claimants who stood to suffer as they would bear financial responsibility for sums in excess of the £1m indemnity limit.

There was therefore a mutual benefit to the Interested Party and the 2^nd and 3^rd Claimants in reducing the Defendants’ bill of costs, whether by assessment or agreement.

Both the Claimants and Defendants conveniently neglect to address the fact it was they who consented to the addition of BCR Legal Assist Limited as an interested party, and with no provision (nor by later variation or amendment) for BCR Legal Assist Limited to be liable for or contribute to the costs of assessment.

I consider it telling that the 2^nd and 3^rd Claimants have not advanced a contractual argument, in that there is no suggestion of a clause in the ATE cover provided that the ATE insurer would assume financial responsibility of any part of the costs of assessment come what may (save for where such costs fell within the indemnity limit).

Further, the 2^nd and 3^rd Claimants do not rely on any arguments that the Interested Party acted outside of the terms of the contract of insurance in taking a leading role with respect to costs negotiations and the detailed assessment process.

Further still, I also consider it telling, albeit sensible, that the 2^nd and 3^rd Claimants have not attempted to pursue a non-party costs order (NCPO) against BCR Legal Assist Limited.

At paragraph 21 of Mr Waszak’s skeleton argument, he states that on 20 November 2023 “BCR instructed Gowling to take no further steps in the proceedings under the terms of the ATE policy” and that from that date “BCR thus took sole conduct of the detailed assessment proceedings, to the exclusion of the Claimants.” This is taken from paragraph 18 of Ms Naylor’s 1^st witness statement, which in turn references exhibit CLN16 (which did not feature in the original hearing bundle).

Paragraph 22 of Mr Waszak’s skeleton argument states that the Claimants raised “strong objections” and that “BCR.. insisted that its own costs firm, BCR Costs Limited, conduct the detailed assessment proceedings.” That conclusion appears to be drawn from paragraph 10 of Ms Naylor’s 1st witness statement which sets out:

“From 20 November 2023, BCR took sole conduct of the matter of the Defendants' costs and, ultimately, these Proceedings, from the Applicants and Gowling as the Applicants' solicitors. BCR insisted that its own costs company, BCR Costs Limited ("BCR Costs"), should have such conduct. That was in the face of strong objections by the Applicants, who had been making good progress in seeking to agree costs with the Defendants.”

No correspondence or documents are exhibited to make good on the suggestions that the Interested Party “insisted” on the use of their preferred costs negotiators, nor have I seen any evidence of “strong objections” from either the Claimants or their legal representatives.

I am satisfied that I have conducted a forensic analysis of the relevant correspondence, guided by references in the witness evidence and oral submissions heard. The 2^nd and 3^rd Claimants, even having been supported by the Defendants, simply fail to evidence the allegations raised.

I am concerned that the 2^nd and 3^rd Claimants seek to set out their arguments with the benefit of hindsight.

The 2^nd and 3^rd Claimants rely on an argument that the preliminary issues raised by the Interested Party, via leading counsel, were “hopeless” or “bound to fail”. However, I consider they have failed to make good on that argument.

Indeed, a reasoned 83 paragraph judgment dated 18 November 2025, having heard from leading counsel for each side, did not even come close to characterizing the addressed preliminary issues as “hopeless” or “bound to fail”.

I have no doubt that had those arguments succeeded and yielded agreement or assessment closer to the proposed figure of £600,000 than the £1m+ the Defendants were holding out for, the Claimants would not be pursuing this application.

It is only because the Claimants are now at personal risk of paying the Defendants’ costs of assessment that they pursue this application with such gusto.

Part of that concern is no doubt fuelled by the frankly astonishing level of assessment costs the Defendants are claiming.

There is at least some certainty in respect of the assessment costs, in that I have already ruled they will be assessed on the standard basis.

Thereafter, the Defendants are put on notice that they will need to work incredibly hard to convince me their assessment costs should not be met with significant reductions.

The parties shall, within 7 days of the handing down of this judgment, liaise and the Defendants’ legal representatives shall bare responsibility for thereafter filing joint dates of availability for a consequential issues hearing.

Such hearing will deal with any costs consequences flowing from this judgment, the conduct of the summary assessment of the Defendant’s costs of assessment, and any other matters relevant to the detailed assessment which require resolution.