Axnoller Events Ltd v Brake & Anor (Rev 1)

Costs thrown away following an adjournment are assessed under the applicable basis in the Civil Procedure Rules 1998. On the standard basis, the court allows costs that were reasonably incurred, reasonable in amount and proportionate, resolving doubt in favour of the paying party. The assessment concerns wasted costs liability, not merely work wasted. Reasonably incurred staged counsel fees may therefore be recoverable even where preparatory work remains transferable or the fees are not wholly connected with work performed. An adjournment made in the interests of justice, and without culpability by the paying party, does not itself justify reducing the innocent party’s recoverable costs.

The judgment concerned costs arising from two earlier procedural decisions in litigation between the parties. The court had ordered the Brakes to pay the Guy parties’ costs of a recusal application on the indemnity basis, subject to further consideration of payment on account. It had also ordered payment of the Guy parties’ costs thrown away when two forthcoming trials were adjourned and relisted.

The present judgment dealt with the summary assessment of those wasted costs. The Guy parties claimed part of four counsel’s brief fees and the costs of preparing the costs schedule. The central issue was whether the claimed staged brief fees should be reduced because the adjournment was not the Brakes’ fault, was required in the interests of justice, or left some preparatory work transferable.

1. Assessment basis. Costs thrown away are assessed under the Civil Procedure Rules 1998. Because the order did not specify indemnity assessment, the standard basis applied under CPR rule 44.3(4). The court allowed only costs reasonably incurred, reasonable in amount and proportionate, resolving doubt in favour of the paying party under CPR rule 44.3(2) and (5) (paras [10]–[13]).
2. Foreign authority. Emami v Furney [2019] ONSC 1731 was not helpful. The statutory costs rules in Ontario differed materially from the applicable English rules, and the test stated in the Ontario decision was different (paras [10]–[12]).
3. Compensation for innocent parties. The assessment was compensatory, rather than dependent on culpability. The fact that the adjournment was not caused by the Brakes, and that it was necessary in the interests of justice, did not justify reducing the Guy parties’ costs. The court relied on Bilta (UK) Ltd v Tradition Financial Services Ltd [2021] EWCA Civ 221, which made clear that the interests of justice include compensating innocent parties whose costs are wasted by an adjournment (para [16]).
4. Costs rather than work. The relevant question was whether costs liability had been reasonably incurred and was reasonable and proportionate, not whether particular work had been wasted or remained transferable. Properly agreed stage-payment brief fees could therefore be recoverable even if they were connected partly with counsel being prevented from taking alternative work, and even if the same work did not have to be repeated (paras [17]–[18]).
5. Disposition. The court summarily assessed the costs thrown away at £63,851.50, comprising the claimed counsel fees and £131.50 for preparing the costs schedule, payable by the Brakes to the Guy parties within 14 days. The question of payment on account of the separate recusal costs was left for further written submissions (paras [4], [19]).