Azure East Midlands Ltd v Manchester Airport Group (Rev 1)

Completion of a case management information sheet does not satisfy the separate obligation to file and serve a costs budget under the Civil Procedure Rules 1998. In deciding whether late filing is trivial, the court must assess the nature of the default together with its practical consequences. Relevant considerations include the length of the delay, prejudice, the parties’ ability to address costs management, disruption to the court’s timetable and whether the hearing can proceed fairly. A two-day delay in serving a costs budget was trivial where there was no prejudice or material disruption and the costs management hearing took place later. Relief was therefore granted under CPR rule 3.14.

This was an adjourned case management conference and costs management hearing in proceedings concerning compliance with an expert determination arising from an agreement for lease. The claimant had served its costs budget five clear days before the original hearing, rather than the seven clear days required by CPR rule 3.13. It argued that timely filing of the case management information sheet satisfied the relevant requirement and, alternatively, sought relief from sanction. The defendant disputed the first argument but alleged no prejudice from the delay. The central issues were whether the claimant was in breach and, if so, whether the breach was trivial or otherwise justified relief.

The court held that the claimant was in breach of the separate costs-budgeting requirements in CPR rules 3.12 to 3.18. Filing a case management information sheet, including estimates of incurred and future costs, did not relieve a party from the obligation to file and serve a costs budget under CPR rule 3.13.

1. The applicable approach was derived from Mitchell v News Group Newspapers Ltd [2013] EWCA Civ 1537 and Chartwell Estate Agents Ltd v Fergies Properties SA [2014] EWCA Civ 506. The court should first consider whether the default was trivial. If it was not, it should consider whether there was a good reason, the promptness of the application and all the circumstances of the case.
2. The court followed the contextual approach adopted in Wain v Gloucestershire County Council & Others [2014] EWHC 1274 (TCC). Triviality depends on the relationship between the default and its consequences. Relevant circumstances included the two-day delay, the absence of prejudice, the parties’ ability to deal with costs management at the adjourned hearing, the absence of material disruption to the court’s timetable and the further seven-week period before the costs management hearing.
3. The claimant’s misunderstanding of the case management notice was not, by itself, a good reason for the default. Nevertheless, the court concluded that the breach was trivial, insignificant and inconsequential. It therefore made an order under CPR rule 3.14 permitting the claimant to rely on its costs budget as filed and served.