Key Facts
- •Michael Wilson & Partners Limited (MWP) appealed an order setting aside a default costs certificate.
- •The default costs certificate was issued against John Forster Emmott for £158,505.34 in arbitral costs.
- •Emmott argued the certificate was issued without jurisdiction because MWP hadn't sought cost assessment from the tribunal as required by s.63(4) of the Arbitration Act 1996.
- •Emmott also asserted a right of set-off against sums owed to him by MWP.
- •MWP argued Emmott waived his right to challenge the certificate by subsequently attempting to set off the amount.
- •The Master set aside the default costs certificate, finding MWP lacked jurisdiction.
Legal Principles
A party can waive a jurisdictional defect.
Brims Construction Limited v. A2M Development Limited [2013] EWHC 3262 (TCC)
Set-off does not extinguish liability until agreement, judgment, or arbitral award.
Stemcor UK Limited v. Global Steel Holdings [2015] EWHC 363 (Comm) and Brown-Forman Beverages Europe Limited v. Bacardi UK Limited [2021] EWHC 1259 (Comm)
Section 63(4) of the Arbitration Act 1996 requires a party to seek cost assessment from the tribunal before applying to the court.
Arbitration Act 1996
CPR 47.12(1) allows the court to set aside a default costs certificate.
CPR 47.12(1)
Outcomes
Appeal dismissed.
Emmott did not waive his right to challenge the certificate's jurisdiction; the set-off argument was premature as no agreement or judgment existed to effect a set-off.