ASHFORD BOROUGH COUNCIL and Ors v FERGUS WILSON

Counsel instructed to conduct litigation has broad apparent authority to agree orders within the scope of the proceedings, including consequential costs orders. The client is bound where the agreement falls within that authority and the opposing party had no notice of any limitation. The court may permit withdrawal before an order is perfected where counsel acted under a material misapprehension, including a mistaken belief about the extent of his authority. A party who succeeds and obtains relief at least as advantageous as a valid Part 36 offer will ordinarily receive the prescribed enhanced costs consequences unless that would be unjust. Costs may be ordered on the indemnity basis, with enhanced interest, an additional amount and a payment on account.

The claimants had obtained a final injunction restraining the defendant from harassing them and those represented in the proceedings. Following the substantive judgment, counsel for both sides agreed a final costs order, including indemnity costs after expiry of a Part 36 offer and a payment on account.

The defendant later asserted that his counsel was no longer instructed and had lacked authority to agree the order. The court was required to determine whether the costs order had been agreed, whether the defendant was bound, and, if not, what costs order should be made.

1. Agreement and authority. The costs order had been agreed when counsel exchanged and approved the proposed order. Counsel remained instructed and had authority extending to considering the judgment and agreeing orders flowing from it.
2. Apparent authority. Counsel generally has broad authority to bind a client in matters within the scope of the litigation. The opposing party may rely on that apparent authority where there is no notice of a limitation or termination. The defendant had produced no evidence that the retainer had ended, that counsel’s authority was restricted, or that the claimants had been notified of either circumstance.
3. Misapprehension exception. Shepherd v Robinson showed that the court may refuse to perfect a consent order where counsel acted under a material misapprehension, including a mistaken belief that his authority was unrestricted. That exception did not apply because there was no evidence of any contrary instruction or misapprehension. The parties were bound by the agreed costs order.
4. Alternative costs decision. If required to decide the issue afresh, the court would have ordered the defendant to pay the claimants’ costs. The claimants had succeeded on the key issues, obtained the relief sought, and had acted reasonably before commencing proceedings.
5. Part 36 consequences. The judgment was at least as advantageous as the claimants’ offer. It was not unjust to apply CPR 36.17(4) consequences: indemnity costs from 26 September 2020, interest on those costs at 10% above base rate, and an additional amount of 10% of the costs awarded. Earlier costs were payable on the standard basis with interest at 8% per annum.
6. Payment and stay. Subject to detailed assessment, a payment on account of £125,000 would have been appropriate. There was no justification for staying the costs order pending any appeal, since no realistic prospect of success had been shown.

The judgment followed the court’s substantive judgment in the same proceedings, [2021] EWHC 2542 (QB). No appellate history was stated.