Litigation Friend Costs and Enforcement of the Same

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What are Litigation Friend Costs?

Litigation friend costs arise when there is a litigation friend appointed to a case. A litigation friend is a person who is appointed to make decisions about a case which is in the Court system on behalf of either a child or an adult who lacks mental capacity. A litigation friend can be appointed in civil cases, such as clinical negligence cases (except for cases in a tribunal), family cases and in a Court of Protection case.

The main duty of a litigation friend is to direct the proceedings in making decisions in the best interest of the other person for whom you are acting as a litigation friend. The litigation friend acting may also be liable to pay costs.

Glover v Barker and others [2020] EWCA Civ 1112

This was a High Court case initially which was later then heard at the Court of Appeal. In this case, the issue of a Litigation Friend’s liability for costs was addressed. It is worth noting that the liability for costs in a case where the litigation friend is that of a child will vary depending on if the child in question is a Defendant or a Claimant.

In Glover v Barker, Mr Barker had set up an employee benefit trust for the purpose of protecting a large sale of his business from capital gains tax. The intention of the trust was that Mr Barker’s five children would become beneficiaries of the sub-trusts created within this employee benefit trust.

This scheme failed, and following a settlement with the HMRC, Mr Barker commenced proceedings to wrap up the trust, and the sub-trusts included. The Court made a representation order stating that one of the children is to represent the rest of the children as beneficiaries. A settlement was then reached on behalf of the children.

Two of Mr Barker’s children and their mother (Ms Glover), had not been involved in the proceedings and had no knowledge of them. The Court found that in fact the proceedings had been concealed from the deliberately.

Ms Glover then made an application, as her children’s litigation friend and sought an order stating that the proceedings and the settlement was not binding on her children in the aim that this would allow them to bring a claim against the trustee for breach. This application was refused, and Ms Glover was required to pay the costs of the other parties due to the order for costs made by the Court. Ms Glover appealed this decision at the Court of Appeal.

The Court of Appeal considered numerous issues in their findings:

1. The general rule of the litigation friend’s liability on costs

Under the CPR, the general rule is that the unsuccessful party pays the successful party’s costs. Under Section 51 of the Senior Courts Act 1981, the Courts have the power to make a costs order under CPR 44.2, where the litigation friend has previously not given an undertaking to pay costs. Where litigation friends are involved, it was held that it should be considered if it would be fair to make an order for costs. If the paying party is a Claimant, it may be fair to order them to pay costs if a costs order was to be made against the relevant party or the Claimant, but the circumstances of the case should be taken into account, and the Court can exercise its discretion. However, there is no presumption that a Defendant’s litigation friend should be ordered to pay costs.

The Court of Appeal held on this point that the Judge at the High Court had made an error in applying that a litigation friend is expected to be liable for such costs as Ms Glover had not acted in bad faith.

2. Consideration of CPR 41.4(3)(c)

CPR 41.4 (3) (c ) states that a person can act as a litigation friend if the child is a Claimant, but that in this instance they will be giving an undertaking to pay costs which may be ordered against the Claimant. It was argued that Ms Glover’s children should be held to be Claimants and that Ms Glover should be deemed to have entered into an undertaking under CPR 41.43(3) (C). This argument was dismissed by the Court of Appeal, holding that Ms Glover did not enter an undertaking as costs against a child were not ordered and thus CPR 41.43 (3) (C) did not apply. 

3. Were the children Claimants?

At the High Court, it was held that the children ‘started the legal process, which led to the costs being incurred’ and for this reason were deemed to be Claimants. The Court of Appeal held that children had only initiated the application, not the proceedings whereby they had not been given the right to defend themselves. It was therefore deemed to be unfair for the children to be deemed as Claimants. 

Based on the above points, the Court of Appeal allowed Ms Glover’s appeal and the costs order was set aside.

How Can ARC Costs Assist?

ARC Costs are an experienced team of specialist Costs Lawyers and Costs Draftsmen. We can assist in preparing a Bill of Costs for costs incurred following any costs orders made by the Courts. Alternatively, we can assist in disputing Bills of Costs which have been served on you by the receiving party following a Costs Order. We can assist in representing you at detailed assessment and through the full costs recovery process. Should you require any further information or our assistance, please contact us on 01204 397 302.

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