Hertsmere Borough Council, R (on the application of) v First Secretary of State & Anor

Where a public authority succeeds against a legally assisted defendant, the court may postpone determination of the defendant’s liability for costs under regulation 127 of the Civil Legal Aid General Regulations. The order may extend beyond the usual six-year limitation where circumstances justify ensuring that proper efforts are made to recover public funds. The court should define the postponement period and may limit the order to costs incurred after a specified date.

The claimant public authority and the second defendant agreed the substantive terms of a consent order. The remaining dispute concerned costs. The claimant sought an order postponing determination of the second defendant’s liability for costs under regulation 127 of the Civil Legal Aid General Regulations, whereas the second defendant invited the court to make no order. The court considered the available approaches identified in Parr v Smith [1995] 2 All E.R. 1031.

1. The substantive order was made by consent, subject to amendment of paragraph 3 of the schedule.
2. The court accepted that there were two possible approaches to costs, as identified in Parr v Smith [1995] 2 All E.R. 1031. One approach was the usual order requiring the legally assisted defendant to pay costs, with the effect that recovery was restricted to six years following determination.
3. Regulation 127 provided a proper basis for postponing determination of the second defendant’s liability for costs. The claimant was a public authority, and the importance of making proper efforts to recover costs justified departing from the usual six-year position in circumstances of this kind.
4. The order therefore required the second defendant to pay the claimant’s costs, but postponed determination of the amount of his liability for three years pursuant to regulation 127 of the 1989 Regulations, or its successor. The order was limited to costs incurred after 30 October 2003.
5. The claimant was directed to draw up the order, insert the correct regulations, obtain the second defendant’s agreement, and incorporate the agreed amendment.

Not stated in the judgment.