Julian Thirsk & Anor v Berkeley Homes (North East London) Limited & Anor

In this matter I held a CCMC on 10 October 2025. In the event it was not possible to deal with cost budgeting that day, and cost budgeting was adjourned to see if agreement between the parties could be achieved. I indicated that if agreement could not be reached, the issues between the Parties should be dealt with on paper.

In the event, the Claimants’ costs budget has been agreed in the sum of £1,157,107.19. The Defendants’ cost budget has not been agreed: this judgment deals with the disputes between the Parties in that regard.

I have received written submissions and the usual Costs Precedents from both Parties.

The Claimants are the owners of a flat in Finsbury Park, London. The Defendants are (1) Berkeley Homes (North East London) Limited and (2) Berkeley Homes (Capital) PLC. The Defendants (individually or collectively) took on work for or in connection with the Claimants’ flat in the form of (1) the original construction works in 2012; and (2) remediation works carried out in 2014 to 2015. The Claimants’ case is that the works were carried out by the Defendants in breach of contract, in breach of statutory duty under the Defective Premises Act 1972 and/or negligently such that the property exhibits defects.

The amount presently claimed was £858,263.56 exclusive of VAT, but has now increased after service of a Scott Schedule to £1,201,141.25 (alternatively £954,597) exclusive of VAT.

The length of trial will be 8 days.

The following is a summary of the principles which I am required to apply:

In paragraph [9] of his judgment in GSK Project Management Ltd v QPR Holdings Ltd [2015] EWHC 2274 (TCC); [2015] 4 Costs LR 729, Stuart-Smith J. said:

“9.

The Costs Budgeting regime has led to disagreement about the extent of detailed argument that is appropriate when considering Precedent Hs. Experience in the TCC has shown that most costs budgeting reviews can and should be carried out quickly and with the application of a fairly broad brush. Only exceptionally will it be appropriate or necessary to go through a Precedent H with a fine tooth-comb, analysing the makeup of figures in detail. For reasons which will become apparent, however, this is an exceptional case which justifies a more detailed approach. The justification lies in the fact that the aggregate sum being put forward for approval is so disproportionate to the sums at stake or the length and complexity of the case that something has clearly gone wrong. The court’s interest in maintaining a robust and just approach to costs management requires an investigation into what has gone wrong for two reasons. First, to enable it to reach a figure which it prepared to approve; and, second, so that the court’s determination to exercise a moderating influence on costs is made clear.”

The Defendants’ costs budget placed before me is in the sum of £2,132,168.22. In the Claimants’ Written Submissions on Cost Management, Mr Sheriar Khan, the Claimants’ counsel, sets out the following useful table:

The first question for me to decide is whether the costs budget put forward by the Defendants is prima facie reasonable and proportionate.

I have no doubt that the overall amount put forward is prima facie disproportionate. Firstly, the amount put forward is just under twice the amount presently claimed. Secondly, the amount put forward is approaching twice the amount of the Claimants’ agreed budget.

Accordingly, in order to consider the reasonableness of the Defendants’ estimates, I have examined each element of the Defendants’ costs budget.

Whilst I have examined the elements of the costs in the various phases, the figure to be taken in respect of each phase is the total allowed by me, not the separate elements.

These costs are less than those in the Claimants’ budget and appear to me to be reasonable.

These costs are not the costs of the CCMC which has already been held – those are incurred costs and outside my jurisdiction to determine. These are the costs in respect of post CMC work up to and including the written submissions made in respect of costs.

These have now been incurred: the costs actually incurred should be included in a revised budget.

The amount put forward is £85,235. £22,382.58 has already been incurred, so that the total amount of incurred and estimated costs is £107,617.58.

Given the amount estimated by the Claimants and given that the costs of disclosure in this case to be incurred by the Defendants are unlikely to be significantly less than those to be incurred by the Claimants, the amount put forward by the Defendants is accepted. Accordingly, I allow £85,235 for the Defendants’ estimated costs in respect of the Disclosure phase.

The amount put forward is £102,400. The Claimants’ equivalent figure is £57,900. The Claimants offer £45,400.

The solicitors’ time suggested is £48,400. Disbursements to counsel are put forward in a total sum of £54,400 (£40,000 for leading counsel and £14,000 for junior counsel).

I do not doubt that it is reasonable for counsel to be involved, but I doubt the need for leading and junior counsel to be involved to the extent which would justify such expenditure.

In the Claimants’ budget £10,200 is included for the involvement of counsel.

In my assessment a reasonable amount to allow is £20,000 for counsel, on top of solicitors’ time of £48,400, making £68,400 in all.

The amount put forward is £276,625. The Claimants’ equivalent figure is £194,970. The Claimants offer £128,625.

The Defendants have already incurred £83,832.70. Thus the total sought by the Defendants is £360,457.70.

By comparison, the Claimants’ total figure is £225,172.35.

A large part of the difference comes from the involvement of counsel in the sum of £61,000. There are also differences as to the amount claimed for involvement of solicitors.

Given the significant expenditure already on experts, the overall figures claimed cannot be justified.

I am prepared to allow the experts’ fees in the total sum of £140,000.

I regard the solicitors’ fees of £75,625 as being high, partly because of the involvement of two partners, but also because of the number of hours one of the partners is estimated to spend (75 hours). In my view a reasonable and proportionate allowance for solicitors’ fees would be £60,000.

As with the witness statements, I regard the estimated expenditure for counsel as being unreasonable. I allow £20,000.

Accordingly, I allow £220,000 for estimated costs in respect of the expert reports phase.

The amount put forward is £88,450. The Claimants’ equivalent figure is £31,482.50. The Claimants offer £43,743.75.

The Defendants’ figure includes £43,450 for solicitors’ fees and £45,000 for counsel.

These figures are disproportionate in respect of both elements.

I allow £60,000 in all.

The amount put forward is £548,850.00. The Claimants’ equivalent figure is £243,500. The Claimants offer £229,750.00.

The Defendants’ figure includes £161,750 for solicitors’ costs and £370,000 for counsel.

Both elements are unreasonable and disproportionate for a claim which is not particularly complicated for a case in this Court.

It seems to me that the Claimants’ offer is too low, although it clearly is in line with the Claimants’ estimated costs.

In my judgment, as to solicitors’ fees, the involvement of a second partner for 60 hours is excessive: I would reduce the solicitors’ fees by £20,000 to £141,750.

I also regard counsel’s fees as excessive: in my view a reasonable allowance would be £175,000 for leading counsel and £87,500 for junior counsel, a reduction of £107,500.

Thus the total I allow for estimated costs is £404,250.

The amount put forward is £435,750.00. The Claimants’ equivalent figure is £288,650. The Claimants offer £242,300.

The Defendants’ figure includes £45,000 for experts. This is reasonable.

The figure includes £143,650 for solicitors’ fees. The Claimants’ equivalent figure is £46,800. I would be willing to allow £75,000 as proportionate and reasonable fees.

Counsel’s fees are £235,500. This is excessive. I have reduced the trial preparation phase by about 30%. Reducing this phase by the same percentage produces a figure of £164,850. I allow £165,000.

Thus, the total amount allowed for the Trial phase is £285,000.

As in respect of the other phases, the difference between the Parties is very significant: in percentages very great.

The amount put forward is £50,200. The Claimants’ equivalent figure is £8,500. The Claimants offer £20,575.

The amount estimated includes £27,500 in respect of counsel’s fees. The balance of £22,700 is entirely in respect of solicitors’ fees.

I have no difficulty in accepting the figure of £22,700 in respect of solicitors’ fees. Preparation for, and attendance at, a mediation could easily require that level of fees.

I do find the figure for counsel’s fees surprising. It is relatively unusual for counsel to attend mediations for large corporations (it is different where the attendance of counsel familiar to individual claimants or defendants is particularly valued). I would allow £15,000 for the involvement of counsel in a mediation. Accordingly, I allow £37,700 for the Defendants’ estimated costs in respect of the ADR phase.

This contingency is in respect of a potential Application in respect of a Request for Further Information.

The amount sought is £21,188 being £5,000 for counsel, £15,875 for solicitors’ fees and £313 in respect of Court fees. The Claimants offer £15,688, the reduction being in respect of the estimate for solicitors’ fees.

The Claimants’ approach seems to me to be reasonable. There is no reason for two partners, an associate and a trainee to be involved in addition to the involvement of counsel. I accept the Claimants’ figure of £15,688.

The result of the above decisions is as follows:

In Mr Khan’s submissions he submitted:

“29.

On a final note, and with respect to paragraph 3 of the draft Order, the Claimant’ position is that the appropriate order concerning the parties’ costs of producing the original Costs Budgets and Budget Discussion Costs for the CCMC should be no order as to costs. As to that:

29.1

Both parties produced Precedent H and Precedent R’s. At the CCMC the Court postponed costs budgeting for reasons not solely attributable to one party, but also where both parties had estimated figures based on different trial periods (4 days for the Cs; 10 days for the Ds).

29.2

Both sides have therefore had to re-work their costs budgets and budget discussion reports. The Claimant’s position is that no costs have been “wasted” by proceeding in this way.

29.3

The Defendants have also taken the opportunity of revising their costs budget to allow for instructing leading counsel and where its costs budget has significantly increased by over £500,000 even though it is now budgeting for a trial with 8 days as opposed to 10 days.

29.4

The time and preparation spent on the original Precedent H and R’s will have meant that the revised versions produced after the CCMC involved much less work than would have been required if starting from scratch.

29.5

The Claimants have been reasonable in agreeing the Defendants’ offer of £1,157,197.19 net of VAT.”

In my judgment the costs of the costs budgeting exercises (both original and revised) should be costs in the case. To the extent necessary, this may mean that the Claimants should be permitted to amend their agreed costs budget.

The Parties are requested to produce updated Costs Budgets (the Claimants’ being revised as suggested in paragraphs 16 and 58 above).