Sunrise in the valley

Thursday has arrived.

Tomorrow I am attending the Association of Costs Lawyers Conference in London, where I will be speaking on the vexed topic of Non Party Costs Orders (NPCOs). There is an inexorable law of lecturing on legal topics, that as soon as you have handed in your slides and paper, some important cases will be immediately handed down, which ideally should be in that material.

Thus I was interested to see two particular decisions in cases on this topic of NPCOs this week.

The first is the long running attempt to make solicitors liable for costs using the NPCO jurisdiction, where they have represented a client who has the benefit of QOCS. The decision is The Scout Association v Bolt Burdon Kemp[2023] EWHC 2575 (KB) where unsurprisingly the High Court judge upheld the earlier decision of Costs Judge Leonard.

I say it is unsurprising: although there have been cases where a solicitor has been held liable for a NPCO, they are few and far between. The judiciary is well aware of the chilling effect that such orders may have. The case was well argued and all points properly made, but the judgment will quickly fade in importance as more and more cases fall within the amended QOCS rules.

It will continue to have resonance where a case fails entirely, so that there are no damages, interest and costs for a defendant to enforce against, and the search for a deep pocket will begin. It would be interesting to see what the Court of Appeal made of the arguments, in this context, but we shall have to see whether the case goes any further, given the historicity of the issue.

The second case that caught my eye concerns credit hire, the legal gift that never stops giving. It is the decision of HHJ Luba KC, in the case of Soares v Wilson and Anexo Group Plc HHJ Luba KC 11th October 2023. The decision concerns an application for a NPCO made against not the credit hire company, but the ultimate parent company which owned the credit hire company as a subsidiary. Unsurprisingly it failed. Putting matters crudely, there was not the necessary nexus of funding, control, benefit, “a real party” or causation, or if these factors were faintly present, they were far too “remote”, to borrow the language of the law of tort. It does however illustrate the limits and inconsistencies of the principles upon which NPCOs are made.

On the one hand, it has been said that the only real concept is that the order must be “just”. On the other hand the open textured nature of this approach creates real uncertainty as to the limits of the jurisdiction. This absence of legal principle creates particular problems in a context where the concept of limited liability has little or no relevance. In the end, time and again, judges fall back onto familiar concepts of funding, control, benefit, the real party and causation, as otherwise there are no lodestones to steer by.  

I look forward to seeing some of you tomorrow, over coffee at the ACL. Please come over and say hello.

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