Barnes v Handf Acceptances Ltd

On a renewed application for permission to appeal, the Court of Appeal distinguished between a second appeal concerning pleadings and an unreviewed costs order made by a High Court judge. A second appeal requires an important point of principle or practice, or another compelling reason. No such question arose from the case-management decision requiring a properly pleaded claim. Permission was nevertheless justified on costs because the proceedings had been restored after the original claim was treated as struck out, a matter which should have been reflected in the costs order. The court remained cautious about interfering with costs discretion.

Mr Barnes sought permission to appeal against an order of Hart J affirming His Honour Judge Cox’s striking out of amended particulars. Hart J ordered the costs of the County Court hearing and the appeal to be the defendant’s costs in the case. Chadwick LJ refused permission on paper and again on renewal, finding no important principle or compelling reason. The renewed application was heard by Lord Justice Carnwath after Mr Barnes’s illness prevented attendance. The issues were whether an appeal should proceed on the pleading and case-management point, and whether permission should be granted to challenge the costs order.

Lord Justice Carnwath held as follows.

1. Reinstated application. Mr Barnes’s illness provided a valid reason for his non-attendance. The Court was therefore entitled under Order 39 (3) to hear the reinstated application.
2. Pleading and case management. The second-appeal threshold required an important point of principle or practice, or another compelling reason. No such issue arose from the decision requiring the claim to be put into proper form so that it could proceed to trial consistently with the objective of the rules. The original claim remained on foot, although it required updating and further particularisation.
3. Costs. The challenge to Hart J’s costs order was not a second appeal, because that order had not previously been reviewed. Although the Court would normally be slow to interfere with a judge’s discretion as to costs, the order was arguably wrong in principle. The High Court proceedings had restored proceedings which had been wholly struck out below after the amended particulars were mistakenly understood to replace the original claim. That restoration was significant and should have been reflected in the costs order, notwithstanding that the amendments had caused a substantial part of the costs.
4. Disposition. Permission to appeal was granted on the costs order alone. There was no permission on the pleading issue. Directions were given for an appeal before two Lord Justices, limited to two hours.

1. Court of Appeal (Civil Division): Lord Justice Carnwath granted permission to appeal on the costs order, but refused permission on the pleading and case-management issue.
2. High Court: Hart J affirmed His Honour Judge Cox’s order and made the challenged costs order.
3. County Court: His Honour Judge Cox struck out the amended particulars, on the mistaken understanding that they replaced the original claim.