The Court of Appeal has found that a decision to restrict a claimant’s costs recovery to court fees only after a failure to file a costs budget on time was correct.

The English court has been considering how to manage the costs of disputes since the Jackson Civil Litigation Reforms which came into force in 2013. Various cases since then have interpreted the new rules; the early tough stance refusing relief from sanctions laid down in Mitchell v News Group Newspapers Ltd [2013] EWCA Civ 1537 in 2013 appeared to have been watered down in Denton v White [2014] EWCA Civ 906 the following year. A series of decisions from the Court of Appeal this year suggest that the Court of Appeal is now reviving the tough sanctions on failure to comply with the Civil Procedure Rules on time.

In Jamadar v Bradford Teaching Hospitals NHS Foundation Trust [2016] EWCA Civ 1001, in which judgment was handed down in July but has only just been reported, the Court of Appeal upheld the decision to restrict a claimant’s recovery of its legal costs from its opponent to court fees only as a result of its failing to file a costs budget on time.

After the court issued notice of proposed allocation to the multi-track, the defendant NHS Trust admitted liability in this clinical negligence case worth in the region of £3 million. As a result the court granted judgment on liability and listed a case management conference. The defendant filed its costs budget more than seven days in advance of that CMC (the old rules in relation to cost budgets were still in place at the time). The claimant failed to file a costs budget in advance of the CMC. The defendant had written to the claimant and sought its compliance with the seven day rule, but the claimant proceeded to the CMC without filing a budget. On the day of the hearing the claimant attended court with an unsigned budget which was offered to the judge and the defendant when the question of budgets was addressed. The defendant objected to having to deal with a budget which had been unseen to that point.

The District Judge found that a cost budget should have been filed in advance and allowed the claimant court fees only. The claimant applied to vary that order or alternatively relief from sanctions. The judge dismissed that application.

This was appealed both to a circuit judge, who dismissed the appeal, and then to the Court of Appeal where judgment was delivered by Lord Justice Jackson. The Court of Appeal dismissed the appeal, finding that a costs budget was required as, despite the form N149C noting the proposed allocation being revoked after liability had been admitted, this continued to be a multi-track case. As a result the claimant was required to file its costs budget in advance of the CMC. If relief from sanctions had been permitted a second hearing would have had to have taken place, lengthening the litigation and adding cost. Secondly, there was no good reason for the breach. Finally, the judge in the original appeal had properly considered all aspects of the case. As such the appeal was dismissed and the claimant would only be able to recover court fees from the defendant even if it were to be successful in its arguments.