Costar UK Ltd v Low & Ors

The court has power under Senior Courts Act 1981, section 51, to make a costs order against a person who is not yet a substantive party. Civil Procedure Rules 1998, rule 44.3(1), regulates the scope of the costs discretion rather than its jurisdictional foundation. The non-party costs procedure in rule 48.2 is inappropriate where the person is being joined as a substantive defendant. A proposed new party is entitled to be heard on an application for joinder, and the court may consider the effect of joinder on that person. An objection to joinder may justify ordering that person to pay the costs occasioned by the objection. Costs remain subject to proportionality.

The claimant sought to join the fourth defendant to proceedings concerning alleged theft of confidential information and conspiracy. The proposed defendant objected to joinder. On 22 October 2013, the Deputy Master joined him and ordered that the costs of the application be costs in the cause, save for the claimant’s costs of and occasioned by his objection, summarily assessed at £4,178.

The proposed defendant appealed, arguing that the Deputy Master lacked jurisdiction, that the order was based on an error of principle or was wholly wrong, and that it infringed Article 6 of the Human Rights Convention. The appeal also raised whether his opposition to joinder had caused the oral hearing.

1. The appeal was dismissed. The Deputy Master had jurisdiction to order the fourth defendant to pay the relevant costs.
2. Section 51 of the Senior Courts Act 1981, as construed in the Aiden Shipping case, conferred power to make a costs order against anyone. Rule 44.3(1) concerned the scope of the costs discretion and did not define the jurisdiction to make a costs order.
3. Rule 48.2 was inappropriate where the person was being joined as a substantive party. The proposed defendant had notice of the application and of the costs order sought, and was a party to that application for relevant purposes.
4. Rule 19.2 did not make the effect of joinder on the proposed new party irrelevant. The proposed defendant was entitled to appear and object. His refusal to consent, coupled with his insistence that his objections be put before the court, caused the oral hearing and justified the costs order.
5. The Article 6 argument failed because he had notice, was entitled to be heard, and his objections were placed before the Deputy Master.
6. Applying the proportionality requirement in rule 44.3(2), the appeal costs were assessed globally at £4,200 plus VAT.

High Court (Chancery Division): appeal from the order of Deputy Master Cousins dated 22 October 2013. The appeal was dismissed.