Williams v Glyn Owen & Co

Permission to appeal may be granted where the proposed challenge has a real prospect of success. That threshold can be met by an arguable case that a claimant was not reasonably expected to pursue difficult and uncertain litigation against a third party as a means of mitigating loss.

Where an interlocutory costs order may be overtaken by the result of the main appeal, the application concerning that order may properly be adjourned until the main appeal is resolved.

The applicant was the claimant in a professional-negligence action against solicitors instructed on a farm purchase. The solicitors were found negligent for failing to advise him that he could serve the vendor with a notice to complete. The Recorder declined to award claimed losses, holding that the claimant should mitigate by pursuing remedies against the vendor.

Two applications were before the Court of Appeal: one concerning the Recorder’s order and one concerning an earlier interlocutory costs order made by Judge Elystan Morgan in the Llangefni County Court. The central issues were whether the challenge to the mitigation ruling had a real prospect of success and how the costs application should proceed.

Lord Justice Ward dealt with two applications arising from the same litigation.

1. Permission concerning the Recorder’s order. The solicitors had been found negligent in failing to advise the claimant that he could serve the vendor with a notice to complete. The claimant contended that, had he received that advice, he would either have obtained completion within 14 days or withdrawn and purchased another farm. The losses claimed included the value attributed to the absent cow quota, hefting charges and loss of the lamb crop.
2. The Recorder had considered that the claimant had rights of action against the vendor for misrepresentation and other relief, and that the duty to mitigate required him to pursue those remedies rather than claim against the negligent solicitors. Ward LJ held that it was at least arguable that the claimant could not reasonably be expected to engage in that litigation. There were practical difficulties, and counsel had advised that the prospects of success against the vendor were not clear or certain. The challenge therefore had a real prospect of success for CPR52 purposes. Permission to appeal was granted in relation to the Recorder’s order.
3. Interlocutory costs order. Judge Elystan Morgan’s order concerned the allocation of costs on three issues. The claimant had succeeded on two issues but was denied costs for those successes and ordered to pay one third of the defendant’s costs on the unsuccessful issue. The remaining costs were costs in the cause and had subsequently been ordered to be paid following the Recorder’s judgment.

Ward LJ declined to determine the costs application finally because success on the main appeal might cause the interlocutory costs orders to fall away. That application was adjourned to be heard on notice to the respondent, with any appeal to follow if permission was granted. Directions were given for a one-day hearing before three members of the Court of Appeal, preferably including a Lord Justice with Chancery experience, and for consideration of pro bono assistance and preparation of the necessary bundles.

• Court of Appeal (Civil Division): In [2002] EWCA Civ 1378, permission to appeal the Recorder’s order was granted. The application concerning Judge Elystan Morgan’s interlocutory costs order was adjourned to be heard on notice, with any appeal to follow if permission was granted.
• Llangefni County Court: The Recorder made the order challenged in relation to the professional-negligence claim, including the mitigation issue. Judge Elystan Morgan made an earlier interlocutory costs order on 14 March 2001.