Howell v Virani & Anor

Permission to appeal requires a real prospect of success. An appeal directed only to the amount at which costs were assessed below will require very unusual circumstances. Where the court is unconvinced of the merits but identifies unsatisfactory features requiring the respondents’ response, it may adjourn the application for an inter partes hearing. The respondents may address the applicant’s conduct and seek the costs of attending that hearing. The application was adjourned and permission was not finally determined.

Mr Mark Howell sought permission to appeal out of time against costs orders made in bankruptcy proceedings brought by Mr and Mrs Virani. A statutory demand for £8,000 was followed by a bankruptcy petition and bankruptcy order. After Howell paid money to the Viranis, the bankruptcy order was annulled, but Howell was ordered to pay costs.

Howell’s appeal was heard in his absence and costs were assessed at £1,500. On a later application, Mr Kim Lewison QC reinstated the appeal and dismissed the bankruptcy petition, while maintaining orders for the petition costs and the £1,500 costs order. Lewison QC later refused to amend the order under the slip rule. Dyson LJ refused permission to appeal against that decision, although he described the position concerning the £1,500 costs as unsatisfactory.

Howell then sought an extension of time and permission to appeal directly against the order of 18 May. The central issues were whether the proposed appeals had a real prospect of success and whether the application should proceed inter partes.

Application adjourned for an inter partes hearing. Lord Justice Mummery was not satisfied that either proposed appeal had a real prospect of success, but considered that the case contained unsatisfactory features which warranted hearing submissions from the respondents before finally disposing of the application.

1. Permission threshold. The court must be satisfied that the proposed appeal has a real prospect of success. On the material then before the court, that threshold was not met. If no satisfactory explanation was provided for the applicant’s conduct and the other unsatisfactory features, permission would be refused.
2. Challenge to assessed costs. An appeal concerning the amount at which costs have been assessed in the lower court requires very unusual circumstances. The proposed challenge to the £1,500 assessment did not, on the submissions made, disclose a sufficient prospect of success.
3. Extension of time and the slip rule. Howell sought to challenge the earlier order directly, rather than appeal the later refusal to alter it under the slip rule. That was a different argument from the one previously advanced before Lewison QC and Dyson LJ, but it did not overcome the lack of a real prospect of success.
4. Inter partes procedure and costs. The hearing was adjourned so that the Viranis could be notified, represented and heard in response to Howell’s conduct. They were entitled to seek the costs of attending the adjourned hearing. The matter was to be restored before Lord Justice Mummery, preferably before the end of July.

1. Court of Appeal (Civil Division) — On 26 April 2001, Lord Justice Mummery adjourned the application for an inter partes hearing. Permission to appeal was not finally determined.
2. Court of Appeal (Civil Division) — Dyson LJ heard an earlier permission application on 6 February 2001. He refused permission concerning the costs incurred before 21 January 2000 and upheld the deputy judge’s discretionary decision that the £1,500 costs order should stand.
3. High Court of Justice, Chancery Division, in bankruptcy — Mr Kim Lewison QC reinstated Howell’s appeal, dismissed the bankruptcy petition, maintained orders for costs, and later refused rectification under the slip rule.
4. Bankruptcy proceedings — Registrar Baister ordered Howell to pay costs on 21 January 2000 after the bankruptcy order had been annulled.