Barron MP & Ors v Collins MEP & Anor

The discretion to order a non-party to pay costs under section 51 of the Senior Courts Act 1981 must be exercised justly. The authorities identify relevant considerations, but do not form a rigid rulebook. The court should examine the non-party’s connection with the litigation, including funding, influence or control, benefit, impropriety and causation. Initial support may constitute pure funding and may not justify liability. Liability may arise where the non-party later uses its influence for its own purposes to prolong proceedings and thereby causes avoidable costs. The absence of an early warning is relevant but not ordinarily decisive. A costs order should be limited to costs fairly attributable to the non-party’s conduct.

The claimants had obtained libel judgments and an order for compensation and costs against the first defendant, Jane Collins. They anticipated recovering little from her and applied for a third-party costs order against UKIP under section 51 of the Senior Courts Act 1981.

UKIP had initially funded legal advice and representation. The issue was whether its later involvement went beyond pure funding and whether it had influenced the conduct of the litigation for political reasons, causing costs that would otherwise have been avoided. The court also considered the significance of the claimants’ failure to warn UKIP earlier and the proper period of any liability.

1. Application granted in part. UKIP was ordered to be jointly and severally liable with Ms Collins for specified reasonable costs, subject to detailed assessment.
2. Section 51 confers a broad discretion. The governing principle is that it must be exercised justly. Authorities such as Symphony Group Plc v Hodgson, Metalloy Supplies Limited v MA (UK) Limited and Dymocks Franchise Systems (NSW) Pty Ltd v Todd identify relevant considerations, but do not impose an inflexible code. The court should consider the non-party’s funding, control or influence, interest or benefit, any impropriety, and whether the conduct caused costs or deprived the claimant of realistic recovery.
3. UKIP’s initial decision in December 2014 to fund limited advice and representation was legitimate pure funding. It was confined to an investigative phase and did not justify a costs order. UKIP was also not responsible for the origins of the libel claims or for costs incurred before its later intervention.
4. By late February or early March 2015, UKIP had made a deliberate and informed decision, for party-political and electoral reasons, to prevent settlement before the General Election. It knew that the defence was weak and that settlement was the realistic course. The decision probably prevented an otherwise likely settlement and caused the proceedings and their costs to continue.
5. The absence of an early warning was relevant but was not decisive. UKIP had not shown prejudice arising from the delay, and it had itself contemplated responsibility for third-party costs. The approach in Brampton Manor (Leisure) Limited v McLean (No 2) did not require a different result on these facts.
6. UKIP was therefore liable for the claimants’ reasonable costs incurred between 20 March and 24 June 2015, the reasonable costs of the January 2017 assessment hearing, and reasonable enforcement costs following the assessment. Costs incurred through Ms Collins’s later applications and conduct as a litigant in person were excluded because UKIP had not caused or contributed to them.

The judgment describes earlier procedural judgments in the same litigation, including the Meaning Judgment [2015] EWHC 1125 (QB), the Stay Judgment [2016] EWHC 1166 (QB), the Application to Vacate Judgment [2016] EWHC 3350 (QB) and the Assessment Judgment [2017] EWHC 162 (QB). The present decision determined the separate third-party costs application against UKIP.