Brake & Ors v Swift & Anor (Rev 1)

Where a party has succeeded at trial, the court may make a costs order and order a payment on account without waiting for an appeal against an earlier interlocutory order or the trial decision, particularly where the proceedings are substantially concluded. A pending appeal does not ordinarily prevent detailed assessment; any necessary adjustment can be made later.

Permission to appeal requires a real prospect of success. Permission should be refused where the proposed grounds merely challenge factual findings, seek to reopen concluded issues, rely on a different legal test, or could not affect the result even if established.

The applicants pursued bankruptcy-related proceedings concerning the revesting of property under section 283A of the Insolvency Act 1986. Following the trial, the court determined that the respondent company had succeeded on the revesting issue and invited written submissions on consequential matters.

The court considered the appropriate costs order, whether costs should await related appeals or further applications, whether a payment on account should be made, and whether permission should be granted to appeal the revesting decision. The earlier standing issue had been decided in [2020] EWHC 1071 (Ch), with permission to appeal refused both at first instance and by the Court of Appeal.

1. Costs. The respondent company was the successful party on the revesting issue. The general rule under CPR rule 44.2(2)(a) applied, and its costs were payable on the standard basis, subject to detailed assessment if not agreed.
2. The proceedings could be treated as concluded for the purposes of CPR rule 47.1. The pending appeal against earlier strike-out orders did not justify postponing the costs order or detailed assessment. If that appeal succeeded, consequential adjustment could be made.
3. The Bankruptcy Application and Liquidation Application had been managed and pursued together. A 50-50 division of their combined costs, excluding costs already covered by interlocutory orders, was a sensible and proportionate method of apportionment. The court ordered payment on account of £300,000 within 14 days.
4. Permission to appeal. The central finding that the applicants’ principal residence at the date of bankruptcy was not the cottage was a finding of fact based on the agreed test drawn from Williams v Horsham District Council [2004] 1 WLR 1137. The Court of Appeal would not be in as good a position to assess evidence from witnesses seen and heard by the trial judge.
5. The proposed grounds could not satisfy the real-prospect-of-success threshold. Some sought to substitute a different test, some repeated evidence already considered, and one sought impermissibly to reopen the concluded standing issue. Bankruptcy law could not alter property rights arising from partnership law. The use of the cottage and adjoining parcels together did not conclusively establish that the adjoining land formed part of the cottage for section 283A purposes.
6. Permission to appeal was refused. The parties were directed to agree and lodge a minute of order.

• High Court (Chancery Division): The standing issue was determined in [2020] EWHC 1071 (Ch). Permission to appeal was refused by the judge and subsequently by Patten LJ in the Court of Appeal.
• High Court (Chancery Division): Following the revesting-issue judgment in [2020] EWHC 1810 (Ch), the present judgment determined consequential costs matters and refused permission to appeal.