Liverpool Freeport Electronics Ltd & Ors v Habib Bank Ltd & Anor

An application for an order requiring the Legal Services Commission to meet a shortfall in costs protected under Access to Justice Act 1999, section 11, must comply with the mandatory time limit prescribed by the applicable regulations. A costs order made by the Court of Appeal does not extend or defer that period unless the order clearly and lawfully provides for that result. A general statutory discretion as to costs cannot override the regulatory scheme.

Habib Bank appealed against an order of Master Rogers dated 5 September 2008. The Master had dismissed the Bank’s application for an order that the Legal Services Commission pay costs which could not be recovered from Mrs Iqbal, who had been publicly funded in earlier Court of Appeal proceedings.

The Court of Appeal’s order included a section 11 costs order and liberty to apply concerning any shortfall under the cost-protection regulations. The Bank applied in December 2007, more than three months after the order of 29 July 2004. The central issue was whether the liberty-to-apply provision extended or deferred the regulatory time limit.

1. The appeal was dismissed. Master Rogers had correctly held that the Bank’s applications were out of time.
2. Under the Community Legal Service (Costs) Regulations 2000 and the Community Legal Service (Cost Protection) Regulations 2000, an application for an order against the Commission had to be made within three months after the section 11(1) costs order. The applicable scheme made that period mandatory. The court relied on R (Gunn) v Secretary of State for the Home Department [2001] 1 WLR 1634.
3. The Court of Appeal’s paragraph 19 provision did not expressly or by necessary implication extend the three-month period or defer its commencement until assessment of the funded party’s liability. Paragraph 18 was a section 11(1) costs order and its making was a precondition to an application against the Commission.
4. The Bank’s proposed alternative route to a High Court judge could not be derived from paragraph 19. The order did not state such an unusual arrangement, and the regulatory scheme governed the exercise of the right to seek payment from the Commission.
5. The general discretion as to costs under section 51(1) of the Supreme Court Act 1981 could not affect the regulations, because that provision was expressly subject to other enactments and rules of court.

• High Court (Queen’s Bench Division): appeal from Master Rogers’s order dated 5 September 2008 dismissed. The Master’s conclusion that the applications were out of time was upheld.