Richardson Roofing Company Ltd v Ballast Plc & Ors

A consent costs order must be construed objectively, in the context of the order as a whole and the background reasonably available when it was made. The phrase “costs incurred and thrown away by the adjournment” did not automatically mean all costs of the action, nor did it include costs claimed for striking out the pleadings where that issue had been expressly adjourned. The proper question was which costs had been wasted by the abortive hearing, allowing for the possibility that the proceedings might later be revived. The detailed assessment was therefore to determine whether preparation undertaken for the adjourned trial retained value in renewed proceedings. The Costs Judge was directed to apply CPR 47.18(2) and disregard the presumption in CPR 47.18(1).

The claimant had brought proceedings arising from roofing works at a development. The Fourth Party, the architects, sought directions concerning the scope of costs payable under a consent order dated 4 November 2003.

The order required the claimant to pay the costs incurred and thrown away by the adjournment of a trial of preliminary issues. The claimant argued that this covered only costs wasted by the adjournment. The Fourth Party sought inclusion of all preparation and attendance costs for the preliminary-issues trial, asserting that none would be useful in any revived proceedings.

The court had to construe the consent order, determine the extent of its jurisdiction to direct the Costs Judge, and identify the correct approach to the detailed assessment.

1. The court had jurisdiction under sections 51(1) and 51(3) of the Supreme Court Act 1981 to give directions to the Costs Judge concerning the persons liable for costs and the extent of the liability. Although the judge had not conducted the preliminary-issues trial or made the consent order, it was appropriate to give directions on matters fully argued before him.

2. The consent order had to be construed objectively, applying the principles stated in ICS Ltd v West Bromwich Building Society [1998] AC 896. The order was to be read as a whole and against the factual background reasonably contemplated on 4 November 2003. The parties’ negotiations and subjective intentions were excluded, while relevant background circumstances could be considered.

3. Paragraph 1 of the consent order covered costs incurred and thrown away by the adjournment of the preliminary-issues trial. It did not include the costs of, or occasioned by, striking out the Particulars of Claim, because that claim had been separately adjourned under paragraph 6 of the order. The order also preserved the possibility that the main action might be revived, so the relevant question was not simply whether costs had ultimately proved useful.

4. The Costs Judge was to decide which preparation and attendance costs had in fact been thrown away by the abortive hearing. That assessment could include consideration of whether documents, expert work, or other preparation undertaken for the June 2003 hearing would have value in renewed proceedings after November 2003. The costs of the present application were costs in the assessment.

5. The assessment was to be undertaken by the Senior Costs Judge or his nominee under CPR 47.18(2), disregarding the presumption in CPR 47.18(1).