Fuseon Ltd v Senior Courts Costs Office

The High Court may intervene under its inherent jurisdiction where a costs decision contains an error of law and maintaining it would cause very serious prejudice, amounting to a real injustice. In assessing prosecution costs from central funds, the decision-maker must ask whether the prosecutor acted reasonably in instructing the chosen lawyers. It is insufficient to ask whether local lawyers could have conducted the prosecution adequately. Relevant evidence about the prosecutor’s actual search and circumstances must be considered. A global reduction may be made after auditing individual items, but it must be comprehensible and based on the statutory criteria. A comparison with Crown Prosecution Service costs is not generally appropriate where the private prosecution arose because the state lacked resources or declined to act.

Fuseon Limited brought a private prosecution resulting in convictions and a central-funds prosecution costs order. The determining officer allowed £200,000 plus VAT after applying regional rates and a global reduction associated with R v Supreme Court Taxing Office ex parte John Singh and Co [1997] 1 Costs LR 49. Master Rowley dismissed Fuseon’s appeal and declined to certify a point of principle of general importance.

Fuseon invoked the High Court’s inherent jurisdiction, alleging errors concerning the use of London solicitors, travel costs and the comparison of private-prosecution costs with hypothetical Crown Prosecution Service costs. The central issues were whether the Master applied the correct legal approach and whether refusal to intervene would cause a real injustice.

1. Inherent jurisdiction. The jurisdiction is exceptional and must be exercised sparingly. A legal error alone is insufficient. Ordinarily, the claimant must show very serious prejudice, assessed in light of the claimant’s financial means and, where relevant, the wider constitutional consequences of the decision. Procedural unfairness is not a necessary precondition.
2. Choice of solicitors. Under section 17 of the Prosecution of Offences Act 1985 and regulation 7 of the Costs in Criminal Cases (General) Regulations 1986, the question is whether the prosecutor acted reasonably in instructing the lawyers chosen. The decision-maker must consider the prosecutor’s actual circumstances, including the searches made, advice obtained, availability and experience of suitable firms, and the importance and complexity of the prosecution. The inquiry is not whether another solicitor or counsel could have conducted the case adequately.
3. The Master adopted the wrong question by asking whether local firms containing experienced criminal practitioners could have conducted the prosecution. He thereby rejected relevant evidence concerning Fuseon’s search for a suitable private-prosecution firm. This was an error of law, consistent with the approach rejected in Dudley Magistrates’ Court ex parte Power City Stores Ltd (New Law Journal, 16 March 1990) and contrary to the relevant guidance in Wraith v Sheffield Forgemasters Ltd and Truscott v Truscott [1996] 1 WLR 617.
4. Global reduction. A Singh reduction may apply to private-prosecution costs. The assessor may stand back after auditing individual items and consider whether the aggregate is reasonable. The exercise should ordinarily address identifiable classes or categories of work so that the reduction is intelligible. It must remain anchored in the statutory test of reasonable compensation.
5. CPS comparison. The determining officer and Master erred in treating hypothetical Crown Prosecution Service costs as the central comparator. R (Law Society of England and Wales) v The Lord Chancellor [2010] EWHC 1406 (Admin) and R (Virgin Media Ltd) v Zinga [2014] 5 Costs LR 879 required attention to the relevant private market. D Limited v A and Others [2017] EWCA Crim 1604 concerned a different costs question and supplied no legal justification for the approach adopted here.
6. The Singh reduction is not invariably incompatible with considering CPS costs. Such comparison may be legitimate where a prosecutor embarks on a private prosecution without regard to whether the state is willing and able to prosecute. That was not this case, where the private prosecution followed the state’s lack of resources and refusal to investigate.
7. Refusal to disturb the decisions would cause a real injustice because the errors caused profound financial prejudice and risked making private prosecutions available only to persons with substantial resources. The Master’s substantive decision and refusal to certify a point of principle were quashed. The matter was remitted to the Senior Courts Costs Office for reconsideration.

The matter arose from the determining officer’s re-determination of Fuseon’s prosecution costs, followed by an appeal to Master Rowley on 30 April 2019. The Master dismissed the appeal and declined to certify a point of principle of general importance. The High Court quashed both decisions and remitted the matter to the first defendant for reconsideration.