Court of Appeal
Global Assets Advisory Services Ltd and another v Grandlane Developments Ltd and others
[2019] EWCA Civ 1764
2019 Oct 9; 23
Patten, Asplin LJJ, Sir Rupert Jackson
CostsDiscretion of courtInterim paymentDefendants accepting Part 36 offer within relevant periodCosts order deemed to have been madeClaimant seeking interim payment on account of costsWhether court having jurisdiction to order interim payment when Part 36 offer accepted within relevant period CPR, rr 36.13(1), 44.2(8), 44.9

The claimants brought proceedings by which they sought relief including a final injunction restraining the defendants from using confidential information. The defendants accepted a Part 36 offer made by the claimants to settle the claim within the “relevant period” for the purposes of CPR r 36.13, so that the claimants became entitled under CPR r 36.13(1)(3) to the costs of the proceedings on the standard basis, including recoverable pre-action costs, up to the date of service of the notice of acceptance the Part 36 offer. A costs order to that effect was deemed to have been made under CPR r 44.9. The claimants applied for an order for an interim payment on account of costs pursuant to CPR r 44.2(8). The judge refused that application, applying earlier authority to the effect that there was no jurisdiction to make such an order where a Part 36 offer had been accepted within the relevant period.

On the appeal—

Held, appeal allowed. The jurisdiction under CPR r 44.2(8) to order a payment on account of costs applied whether the underlying costs order had been made pursuant to the general discretion of the court expressed in CPR r 44.2 or, as in the present case, was deemed to have been made under CPR r 44.9. There was no reason why the power to make an order under CPR r 44.2(8) should be restricted to circumstances in which the court had physically made the order as opposed to circumstances in which an order of the court was deemed to have been made. In both circumstances, it was the court which had ordered the party to pay the costs and accordingly the circumstances fell within the wording of CPR r 44.2(8). A deemed order was no less an order of the court. The policy underlying payments on account of costs that a person entitled to costs should not be kept out of the portion of those costs to which he was plainly entitled pending detailed assessment applied equally whether or not the order was deemed to have been made. Nothing in CPR Pt 36 suggested that it was entirely freestanding and that all costs consequences of accepting a Part 36 offer were to be found within CPR Pt 36 itself. On the contrary, CPR r 36.13 expressly referred to CPR r 44.3(2) which explained “the standard basis for the assessment of costs” and to CPR r 44.9 which gave effect to CPR r 36.13 by providing for deemed costs orders. CPR r 36.13(1) entitled a party to its costs of proceedings on a particular basis and was complemented or supplemented by CPR r 44.2(8) which created the jurisdiction to order a payment on account of those costs. It followed that there was no conflict or tension between those two provisions. Accordingly, the court in the present case had jurisdiction to order an interim payment on account of costs and, in all the circumstances, it was appropriate that sich an order nb be made (17, 18, 32, 34, 35, 36, 37, 38, 39).

Barnsley v Noble [2013] 2 Costs LO 150 applied.

Finnegan v Spiers (trading as Frank Spiers Licensed Conveyancers) [2018] 6 Costs LO 729 overruled.

Decision of Teare J [2019] EWHC 947 (Comm) reversed.

Rupert Cohen (instructed by Stephenson Harwood llp) for the claimants.

The defendants did not appear and were not represented.

Scott McGlinchey, Barrister

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