Failure to Pay Court Fee & CPR 44.9

 

 

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Payment of Court Fees

During the course of litigation, there are specific points at which the Claimant/Applicant is required to pay Court fees to advance the litigation process, failing which the claim will be struck out for non-compliance.

When a matter is listed for Trial for instance, the Claimant must pay a hearing fee to the court. In matters where notice of the Trial was given more than 36 days before the Trial date itself, this fee must be paid 28 days before the Trial. If notice of the Trial was provided less than 36 days before the Trial date, then the Trial fee payment date will be no less than 7 days before the Trial.

Specific dates for payment of Court fees can also be included within Court Orders, such as a Notice of Allocation or Notice of Trial.  

Mandatory Court payments apply in various Courts, such as Family Court, County Court, or the High Court. Moreover, they are non-refundable and cannot be recovered if a matter settles prior to Trial (the only exception to this being that if a Court fee is paid and a remission is subsequently successful applied for within 3 months, a partial or full refund may be obtained on the Court fee).

 

Failure to Pay Court Fees and the Consequences

If there is a failure to pay a Court fee by the required date, such as the hearing fee payment date, the Claimant’s claim will be struck out and the Trial will not take place.  It is not necessary for a Defendant to write to the Court for such a strike out, and the Court will often do this of their own volition if the Claimant has failed to act compliantly. Depending on the facts of the matter and the context of the strike out, the Claimant may be able to issue fresh proceedings, though issuing for the same claim may subsequently found to be an abuse of process (in such instances, it would be prudent to obtain legal advice from a Solicitor on the merits of applying to reinstate the claim, or whether to issue fresh proceedings). However, as previously mentioned, the original Court fee will not be refunded.

Therefore, it is important to remain organised with payment dates as commencing fresh proceedings will only incur more legal costs, and potential adverse costs consequences.

 

Claiming Costs when a Matter is Struck Out due to a Failure to Pay Court Fees

Civil Procedure Rule 3.7A highlights that “if the claimant does not pay the fee…make an application for a full or part remission of the fee… the claimant will be liable for the costs which the defendant has incurred unless the court orders otherwise” 

This topic is also discussed in Civil Procedure Rule 44.9(1). Here it is stated that “subject to paragraph (2), where a right to costs arises under rule 3.7 or 3.7A1 (defendant’s right to costs where claim is struck out for non-payment of fees…a costs order will be deemed to have been made on the standard basis.”

This means that on strike out for non-payment of Court fees, a Defendant/Respondent is automatically entitled to their costs.  The reasonableness and proportionality of the Defendant’s incurred costs will be assessed via the detailed assessment procedure and the Claimant will be held liable for payment. Therefore, the Defendant would be required to prepare a Bill of Costs and to serve this formally with a Notice of Commencement.

 

Is the Matter Always Struck out if a Court Fee is not Paid?

In most matters, it is very likely that a claim will be struck out due to failure to pay the Court fee. Though in the recent matter of Boodia v Yatsyna [2021] EWCA Civ 1705, this was not the case.

The facts of the matter state that the Claimant had failed to pay the Court fee due to the loss of a cheque thus their action was ordered to be struck out. However, the Claimant successfully appealed to the Court of Appeal.

At this stage the Court acknowledged that although any breaches of trial fee payment dates are serious, “some are more serious than others”. In paragraph 64 of the judgment, it was stated that, although the Claimant’s actions breached the correct Court conduct, it did not halt the progress of the litigation, as the payment was only delayed by one day. The Court took the position that the effects seen on the litigation were a consequence of the Defendant and the Court’s response to the delay. 

As a result of this, the Claimant was granted relief from sanctions. This was decided because the Court thought it wholly disproportionate to strike out the entire claim, as it would only delay settlement if fresh proceedings were required.

This case is helpful as it indicates that the Court is not always rigid in their decision making. Instead, they are able to look at the context of the matter and the seriousness of the breach when deciding whether to strike out a matter due to a failure to pay a Court fee.  The success in any application to set aside a strike out however, would very much depend on the promptness of any application for relief from sanctions to which the Denton test applies. Timely intervention in response to such a strike out order is therefore important.  Nevertheless, Solicitors and Claimants should seek to avoid having to rely on this common law decision, and should focus on ensuring they remain organised in their payment of any fees to the Court as relief is never not guaranteed.

 

How can ARC Costs Assist?

At ARC Costs, our independent team of expert Costs Draftsmen and Costs Lawyers can be relied upon to provide an expert legal costing service. 

With over twenty years of experience, our team can prepare comprehensive costing instruments, such as Bills of Costs or Costs Budgets. Moreover, they can handle negotiations and seek the most effective legal costs settlements for our clients. Alternatively, our Costs Lawyers who hold rights to audience, can advocate on your behalf in Court.

If your matter has been struck out and you are liable to pay the Defendant’s costs, we can consider the other party’s bill and conduct negotiations to minimise your exposure to legal fees. Opposingly, if you are awarded costs in the matter, we can draft your Bill of Costs.

For the avoidance of doubt, we are not Solicitors and specialise in legal costs only.  As such, if you require advice on the merits of any application to set aside an order for a strike-out, we would always recommend speaking with a Solicitor first. 

To find out more about how we can help you in your matter, please contact an expert directly at 01204 397302 or email us at info@arccosts.co.uk.  

 

 

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