Interim Costs Orders

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Days Health Care UK Limited  -v-  Piah-siang Machinery Manufacturing Limited

This is an interesting case involving the powers of the Court and is something which practitioners might like to bear in mind on matters which proceed to a trial where it may be possible to get a interim order for some costs to be paid pending the Detailed Assessment Hearing. 

In this case at the end of the trial the Judge ordered the Defendants to make an interim payment towards costs of £2,000,000.00.  The Defendants were refused permission to appeal initially. 

The Court of Appeal then granted permission to appeal on conditions which were not satisfied and the appeal was ultimately struck out.  Detailed Assessment Proceedings were commenced and a Bill of Costs totalling the sum of £4.7 million was served. 

Points of Dispute were served which were said to challenge “every minute worked on the case”.  Subsequently the Claimant’s solicitors wrote to the Defendant’s solicitors with draft directions for the Detailed Assessment and included an application that unless the Defendants paid the interim costs order of £2,000,000.00 plus interest as ordered by the Trial Judge a final costs certificate should be issued in the amount claimed. 

Initially the Costs Judge was of the view that he could not debar the Defendant from taking part in the Detailed Assessment procedure and that the usual approach to an order for payment (i.e. the order for the £2,000,000.00 interim payment) was to enforce it and that the Defendant should not be shut out from participating in a Detailed Assessment. 

The Claimant appealed and the appeal was allowed.  The Judge on appeal was of the view that although the Claimant’s bill should not simply be “rubber stamped” in the amount claimed and there should be an assessment, Defendants must not be permitted to participate in the assessment unless they have made the payment of the interim amount ordered in the sum of £2,000,000.00 together with interest.  

The Judge anticipated that if payment was not made by the date he had ordered then the Costs Judge and the Claimant could then review the time estimate for the Detailed Assessment hearing as it would be expected to take only a small fraction of the estimated time as the Defendant would not be permitted to take part in the Assessment procedure.

I think it is always worthwhile asking for an interim award of costs pending a Detailed Assessment procedure at trial or even as part of the terms of an agreed settlement. 

This case should at least assist in ensuring that any payment actually agreed or ordered is made promptly.