High Court Rules on Validity of Default Costs Certificate in Willis v GWB Harthills LLP & Ors: Importance of Procedural Compliance Emphasized

Citation: [2024] EWHC 409 (SCCO)
Judgment on

Introduction

In the case of Michael Geoffrey Willis v GWB Harthills LLP & Ors, the High Court of Justice, Senior Courts Costs Office (SCCO), presided over by Costs Judge Leonard, addressed several pertinent legal issues concerning costs assessment following an Employment Tribunal decision. The case delves into the principles governing detailed assessment of costs, the correct procedural approach for challenging a default costs certificate, and criteria for setting aside such a certificate under the Civil Procedure Rules (CPR).

Key Facts

Mr. Willis, the Applicant, sought to set aside a default costs certificate issued by the SCCO following an Employment Tribunal costs award against him. The Employment Tribunal had previously ordered detailed assessment of costs, capped at £210,000, to be conducted in the County Court. The serving party, GWB Harthills LLP & Ors, served a Notice of Commencement of the detailed assessment process out of the three-month prescribed period, to which the Applicant did not respond with points of dispute as required. Consequently, a default costs certificate was issued. The Applicant contended that the late service invalidated the commencement of assessment and that he awaited responses from the Respondents before filing any points of dispute.

Several legal principles were central to this case:

  1. Rules on Tribunal Costs Awards and Detailed Assessment:

    • Employment Tribunal rules (The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013) empower an Employment Tribunal to make a costs order with the amount determined by detailed assessment under the CPR 1998.
    • Part 47 of the CPR governs detailed assessment proceedings in the County Court and High Court.
    • The SCCO is often the appropriate office for handling detailed assessment proceedings, especially in Greater London, as noted in the Civil Procedure Rules.

  2. Sanctions for Delay:

    • CPR 47.8 outlines sanctions for delays in commencing detailed assessment proceedings. It does not automatically invalidate proceedings commenced after the three-month period unless a paying party successfully applies to court to disallow costs due to delay.

  3. Setting Aside Default Costs Certificates:

    • Under CPR 47.12 and Practice Direction 47 Part 11, a default costs certificate can be set aside if improperly issued or if there is good reason for the detailed assessment to continue.
    • Compliance with rules is essential, but applications for relief from sanctions consider the need for litigation to be conducted efficiently and at proportionate cost (CPR 3.9).
    • The Denton test, formed as per Denton v TH White Ltd [2014] EWCA Civ 906, assesses the seriousness of non-compliance, good reason for it, and consideration of all circumstances of the case.

  4. Costs Following the Event:

    • As established in Barton v Wright Hassall LLP [2018] UKSC 12, litigants in person are treated equally to legally represented parties in terms of complying with court rules.

Outcomes

Despite the Applicant’s arguments, Judge Leonard determined that the Respondents’ Notice of Commencement was valid, and the detailed assessment proceedings were not invalidated by the delayed service. The Applicant failed to demonstrate sufficient reason for not serving points of dispute and did not meet the burden of showing why the detailed assessment should continue. The Applicant’s failure to comply with the CPR regarding points of dispute was deemed serious and without good reason. Consequently, Judge Leonard dismissed the application to set aside the default costs certificate and ordered the Applicant to pay the Respondents’ costs of the application, which were summarily assessed at £2,750.

Conclusion

The judgment in Willis v GWB Harthills LLP & Ors underlines the importance of adhering to procedural rules, particularly concerning detailed costs assessments in legal proceedings following an Employment Tribunal decision. Costs Judge Leonard rigorously applied the principles set out in the CPR, focusing firmly on ensuring compliance and the efficient conduct of litigation. The decision emphasizes to legal professionals the consequences of failing to engage with the detailed assessment process and the limited grounds on which a default costs certificate can be challenged. This judgment is a reminder of the courts’ expectation that all litigants, including those who are unrepresented, understand and follow the rules set out in the CPR.