Application to Strike Out Claim: Case Study

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Introduction

ARC Costs were approached by a Litigant in Person, representing a business, who had made an application to strike out claim brought against them and three other Defendants for trespass. The Defendants were successful in achieving strike out of the claim however, no provision for costs was made for despite the Defendants having incurred defence costs of £30,000+. ARC Costs successfully lodged an application supplementing the initial application to strike out claim, to remedy the costs position and obtain the Defendants a costs order in their favour so that a Bill of Costs could be prepared.

 

Why was an Application to Strike Out Claim Necessary?

The Claimant had initially been proactive in litigation, but appeared to come to realise that their claim was unlikely to succeed, and proceedings therefore lost momentum. Costs Budgeting had taken place, and the Claimant had succeeded when instructing a Solicitor, to justify that their legal costs would be in excess of £50,000 to proceed to Trial. Subsequent to this however, the Claimant sought to act as a Litigant in Person, and repeatedly failed to adhere to Court directions to provide witness evidence. On three occasions, the Court granted extensions for compliance with Court directions in favour of the Claimant; however, on each and every occasion the Claimant failed to provide said evidence. 

Excuses varied between the Claimant reportedly being in ill health, to difficulties in obtaining legal representation. None of these raises sat well with the Defendant, the Claimant being an individual that could afford legal representation, and also seeing social media activity that showed the Claimant remained active irrespective of any ill health complaints. 

In addition, the Claimant had been able to instruct family members to provide representation on their behalf at hearings, and it appeared that the drifting litigation was simply a delay tactic in the hope that the claim would go away or settle on a previous offer made to the Defendants, even though the Claimant had instigated the action and the claim had been denied in full.

The Defendants, therefore, made an application to strike out the claim at Court for the Claimant’s failure to comply with Court directions, and were successful in obtaining an order to the same effect in order to bring legal proceedings to an end. However, no consideration had been given to the Court as to costs, and in the ensuing months the Defendants liaised with the Court to confirm whether they could make a claim for costs. The Court confirmed that a request for costs could be made, but it would need to be by the proper application process.

 

What is a Deemed Order for Costs?

 

There are certain occasions when a deemed order for costs is made, such that a specific Court Order is not required for the same. Strangely, strike out orders do not always automatically result in costs however, pursuant to CPR 44.9 an Order for costs is deemed to have been made when:

Whilst strike out of a claim due to non-payment of Courts fees or dishonouring a cheque provides an automatic right to costs (likely because this directly impacts on the Court’s ability to progress litigation), the specific act of striking out a claim or defence for general non-compliance or lack of merits requires the Court to make a specific order for costs.

As such, in any application to strike out a claim or to strike out a statement of case in the civil courts, or in sending any letter to the Court seeking strike out for non-compliance (for instance if a Court states a claim will be struck out if specific directions are not complied with), the opposing party should specifically ask for an order that provides for their costs.

Quite often, the ground for bringing a strike out application is either due to an abuse of process, or if the defending statement of case discloses an argument that a claim has little to no chance of success, such that summary judgment should be made against the claiming party, without the need for a full Trial.

 

What Costs Order Was Obtained?

 

On instruction of ARC Costs, we assisted the Defendant Litigant in Person in applying for a costs order pursuant to CPR 44.2, the Court’s general discretion to make costs orders.

In the first instance sitting in the County Court, the Claimant failed to attend the hearing citing ill-health as their reason. Again a family member had been able to provide information on the Claimant’s behalf but had not been willing to attend the hearing to defend the claim. Though we argued that a pattern of behaviour was emerging, the Court adjourned the matter to allow the Claimant further opportunity to attend the hearing and to respond to the application.

At the second adjourned hearing, the Claimant again failed to attend, relying upon purported medical evidence from their GP as to ill-health. It was highlighted that the Claimant appeared to be seeking to stifle the application by repeatedly citing ill-health, akin to their conduct prior to the application for strike out of claim. Ultimately it was found that the medical evidence provided was lacking, and simply stated that the Claimant was under the care of the GP who had written the note. No medical examination had taken place, nor was there any formal expert evidence in support of failing to attend a hearing in line with Levy v Ellis-Carr [2012] EWHC 63 (Ch), providing details of any prognosis to allow the litigation to proceed.

The Court considered the overriding objective, and that the litigation must be dealt with expeditiously and fairly, as well as taking into account appropriate use of Court resources and time. It was considered that the Claimant had failed to provide any good reason not to attend the hearing, and therefore the application was allowed to proceed.

Matters subsequently turned to ‘the flow of costs’ in the matter. It was accepted by the Court that the general rule under CPR 44.2 was that the losing party should pay the costs of the winning party. Given the Claimant’s poor conduct and compliance throughout litigation, the Court did not hesitate to award a costs order in the Defendant’s favour. Consideration was given as to an appropriate interim payment on account of costs, which was also dealt with by the Court, and when it came to assessment of the Defendant’s application costs, consideration was given as to whether it was fair for summary assessment to proceed in the Claimant’s absence. Though reference was made to the usual rule that summary assessment should take place of any hearing that takes less than 1 day, the Court was minded to include the costs of the application as part of the order for detailed assessment, given that the Claimant had not been available to attend to contest such costs. As such, a payment of £1,500 was accounted for in the final Court Order on account of application costs.

This concluded the application, and ARC Costs were subsequently instructed to prepare the Defendant’s Bill of Costs for detailed assessment.

 

How Can ARC Costs Assist You?

 

ARC Costs are a team of specialist Costs Draftsmen and Costs Lawyers who can assist in all costs related disputes. We regularly provide advocacy related services to professional and Litigant in Person clients, and as independent costs experts we can act for either the Paying or Receiving Party.

If you require costs assistance following an application to strike out claim, please do not hesitate to get in touch. 

If you are awarded costs, we can assist in preparing a Bill of Costs on your behalf, and negotiating with the Paying Party to achieve the best outcome on your behalf. As regulated Costs Lawyers, we can conduct the processes and procedures in relation to legal costs, known as detailed assessment proceedings, on your behalf. Therefore if it becomes necessary, we can take disputed costs matters throughout the Court process to a detailed/provisional assessment hearing to obtain the best result. 

If a costs order is made against you or your client, we can also assist in preparing Points of Dispute and ensuring significant reductions are applied to the costs claim. We also seek to bring matters to an expeditious and cost-efficient close, so as to avoid the accrual of interest and detailed assessment costs. 

To discuss your costs claim further, please do not hesitate to contact us on 01204 397302 or email one of the team at info@arccosts.co.uk. Alternatively, you may complete our online enquiry form and we will be in touch to discuss your query further on the same day.

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