Khaira & Ors v Shergill & Ors

For costs purposes, an appeal is ordinarily treated as separate proceedings from the trial or substantive claim. Where an appellate costs order covers discrete appeal costs and does not expressly require immediate assessment, the receiving party may nevertheless be entitled to proceed to detailed assessment, depending on the applicable costs regime and the order’s true meaning. A costs judge may also have jurisdiction to permit immediate assessment where the appellate court has not made such an order. That jurisdiction is discretionary and must be exercised proportionately. An appellate court should not interfere with a specialist costs judge’s case-management decision unless the decision falls outside the reasonable ambit of discretion or reflects an error of principle.

The defendants appealed against an order of Master Simons dismissing their application to set aside notices commencing detailed assessment of the claimants’ costs incurred in earlier appeals. The Supreme Court had ordered the defendants to pay the claimants’ costs in the Supreme Court and Court of Appeal, assessed on the standard basis if not agreed, but had not expressly ordered immediate detailed assessment.

The substantive litigation concerned disputes within a Sikh sect. The Court of Appeal had allowed an appeal on justiciability, but the Supreme Court had unanimously allowed the claimants’ further appeal and directed that the issues proceed to trial. The appeal raised whether the Supreme Court order conferred an immediate entitlement to assessment, whether a costs judge could order or permit immediate assessment, and whether Master Simons had properly exercised his discretion.

1. Appeal dismissed. The Supreme Court’s costs regime was distinct from the Civil Procedure Rules. Under the Supreme Court Rules 2009, an appeal was treated as separate proceedings for costs purposes, and the costs order was construed as permitting immediate detailed assessment of both the Court of Appeal and Supreme Court costs. A single order covering both categories could not sensibly permit immediate assessment of one category but not the other.
2. Even if the Civil Procedure Rules applied by analogy, the result was the same. The reasoning of the majority in Hawksford Trustees Jersey Ltd v Stella Global UK Ltd and another (No 2) [2012] EWCA Civ 987 established that trial and appeal are separate proceedings in the costs context. On that basis, the relevant proceedings concluded when the appeals ended, so no separate forthwith order was required under CPR 47.1.
3. The court followed GB Gas Holdings Ltd v Accenture (UK) Ltd and Others [2010] EWHC 2928 (Comm) in holding that a costs judge may have jurisdiction to order immediate assessment of appeal costs even where the appellate court has not done so. The discretion remains fact-sensitive and should not generate inappropriate applications.
4. Master Simons had considered the relevant factors, including possible overlap, proportionality, prejudice and the discrete nature of the appeal costs. His decision was well within the generous ambit of reasonable disagreement. The appeal disclosed no error of principle and was dismissed. The parties were directed to agree the form of order, with further submissions reserved on unresolved matters including costs and permission to appeal.

• Supreme Court unanimously allowed the claimants’ appeal and ordered the defendants to pay the claimants’ costs in the Supreme Court and Court of Appeal, assessed on the standard basis if not agreed. The citation given was [2015] AC 359.
• High Court (Chancery Division) dismissed the present appeal from Master Simons’ order of 10 September 2015 and upheld the continuation of detailed assessment proceedings.