NICOLETTE BERRIN ADCOCK v BLEMAIN FINANCE LTD

The court has discretion under CPR 40.8 and CPR 44.2(6)(g) to award interest on costs from before judgment. The default remains the incipitur rule: interest ordinarily runs from the date of the costs order. Departure is justified only where justice requires it, assessed on a broad-brush basis. In modest, high-volume assessments, a bespoke calculation of funding-loan interest is generally inappropriate where it would add complexity, evidence and disproportionate cost. Under CPR 44.11, misconduct powers concern the conduct of a party or that party’s legal representative. They do not ordinarily apply to alleged misconduct by an unrelated third party. Unsupported hearsay and cumulative inference may be insufficient to establish unreasonable or improper conduct.

Three test costs assessments arose from successful claims against the defendant concerning allegedly unfair loan arrangements under the Consumer Credit Act 1974. The claimants had used non-recourse funding loans carrying interest at 30.3% per annum to fund disbursements. They sought pre-judgment interest on that borrowing.

In two of the assessments, the claimants also sought recovery of fees paid for Legal Hub Reports. The defendant alleged that the reports concealed referral fees and sought disallowance under CPR 44.11. The central issues were whether funding-loan interest should be awarded before judgment and whether the Legal Hub fees were recoverable.

1. Pre-judgment interest. The claims for pre-judgment interest were dismissed. The powers in CPR 40.8 and CPR 44.2(6)(g) confer a discretion to order interest on costs from a date before judgment. The incipitur rule remains the default position, and departure is warranted only where justice requires it.
2. The discretion must be exercised on a broad-brush basis. It is generally undesirable to calculate interest separately for different items or dates in a costs assessment. In these modest, individual assessments, bespoke calculations would create additional evidence, calculation disputes and prolonged argument, with a significant risk that assessment costs would become disproportionate. A common period would not cure those problems.
3. The court therefore declined to award interest on the funding loans. It did not determine whether the claimants needed the loans, whether the interest rate was reasonable, or whether the calculations were accurate.
4. Legal Hub fees. The defendant’s challenge under CPR 44.11 was dismissed. That rule concerns unreasonable or improper conduct by a party or that party’s legal representative. The alleged conduct principally concerned a former employee of the defendant and did not fall within that statutory wording as applied to the claimants’ assessments.
5. Alternatively, the evidence did not establish misconduct. The claimants’ witness gave direct evidence concerning the reports’ purpose and denied any referral-fee arrangement. The defendant’s evidence relied on an unidentified whistle-blower and a succession of inferences. That evidence raised suspicion but fell well short of proving unreasonable or improper conduct. The Legal Hub fees were accordingly recoverable as claimed.

The claimants’ pre-judgment-interest claims were dismissed, and the defendant’s challenge to the Legal Hub fees was dismissed.