Tanka Thakali & Ors v Navin Kumar Gauchan & Anor

In detailed assessment proceedings, the receiving party will ordinarily recover the costs of the assessment under Civil Procedure Rules 1998, rule 47.20. The court may make a different order having regard to the circumstances, including party conduct, the reduction to the bill, and whether particular items were reasonably claimed or disputed.

A receiving party’s success in beating an offer does not, without more, justify indemnity costs. Such an order requires conduct out of the norm where the offer was not made under Part 36. Costs must remain reasonable and proportionate, and unnecessary work undertaken to remedy inadequate preparation or disorganised papers may be disallowed.

The claimants brought detailed assessment proceedings concerning a bill of costs initially claimed at £105,133.49. The bill was assessed at £88,409.44. The assessment required two hearing days because issues concerning the claimants’ retainer with their solicitors could not be resolved at the first hearing.

The court had to determine responsibility for the costs of the detailed assessment proceedings, the basis on which those costs should be assessed, the recoverable amount of the claimants’ own costs, and whether interest should be addressed within the assessment.

1. Costs of the detailed assessment. The usual order under CPR rule 47.20 was that the claimants, as the receiving party, should recover their costs. The court nevertheless had power under rule 47.20(3) to make a different order having regard to the circumstances, including conduct, the reduction to the bill, and the reasonableness of claiming or disputing particular items.
2. The defendants’ objection had substance only in relation to the first hearing, which was adjourned because the retainer issues could not then be dealt with satisfactorily. The claimants were therefore not awarded the costs of attending that hearing. The defendants were not ordered to pay their own costs of that hearing because the issue had not been clear-cut and the claimants had beaten their offer.
3. The claimants’ offer did not justify indemnity costs for the remaining proceedings. Although it exceeded the sum ultimately recovered, it was not made under Part 36. Under CPR 36.17, a Part 36 offer would ordinarily have produced an indemnity basis order, but otherwise the claimants had to show conduct out of the norm. Rejection of an offer later shown to have been advantageous was insufficient, and the correspondence disclosed no conduct outside the norm.
4. The claimants were awarded their costs of the detailed assessment proceedings on the standard basis, excluding the first hearing. On summary assessment, unnecessary or excessive work was disallowed, including much of the witness-statement and electronic-bundle work undertaken to address shortcomings in the evidence and organisation of the files. The allowed costs totalled £21,339.08, having regard to reasonableness and proportionality under Part 44 and CPR 44.3(5).
5. The claimants were entitled to statutory interest at 8%. The court made no order altering that entitlement. Any disputed entitlement to offset interest obtained by the claimants was a matter for the County Court, involving factual issues outside the remit of detailed assessment.

Not an appeal. The judgment determined further issues arising in the detailed assessment proceedings and followed an earlier written judgment in the same assessment.