Invenia Technical Computing Corporation & Anor v Matthew Hudson

Where costs are payable subject to detailed assessment, the court will ordinarily order a reasonable payment on account. A good reason not to do so may arise where the costs schedules and supporting evidence lack sufficient credibility to provide a proper basis for a broad-brush estimate of likely recovery. This is so even without a finding of dishonesty.

A litigant in person may recover proven financial loss only for time reasonably spent on the work. Otherwise recovery is limited to the prescribed hourly rate and remains subject to the two-thirds cap. Payments for legal services and expert disbursements must satisfy the applicable requirements for recoverability, reasonableness and proportionality.

An unreasonable refusal to agree a modest, justified extension of time may justify an adverse costs order.

Matthew Hudson sought a payment on account under CPR r 44.2(8) after Invenia’s application to vary an electronic imaging order had been withdrawn and dismissed with costs payable to him, subject to detailed assessment.

He claimed approximately £407,900, including compensation for alleged lost consultancy earnings at £800 per hour, fees invoiced by an unregulated legal adviser, and an unidentified expert disbursement. Invenia contended that the schedules were unreliable and that any likely recovery was substantially lower. Hudson also opposed Invenia’s application for a short extension of time to serve evidence in response.

The central issues were whether the evidence provided a sufficient basis for an interim costs payment and who should bear the costs of the extension application.

1. Payment on account. The application was refused. Although CPR r 44.2(8) creates a presumption in favour of ordering a reasonable payment on account, Invenia established a good reason to depart from it. The matter was properly left for detailed assessment at the conclusion of the litigation.
2. The claim for 393 hours of work on a modest and ultimately uncontested variation application lacked credibility, proportionality and reasonableness on the broad-brush material available. The court could not sensibly estimate likely recovery. Any error could be corrected on detailed assessment.
3. Hudson had not shown financial loss within CPR r 46.5(4). He had to establish both that the relevant time would otherwise have been spent on consultancy work and that the work would have generated the claimed equivalent of £800 per hour. The evidence did not satisfy those requirements. The prescribed £19 hourly rate could not safely be applied because the number of reasonably spent hours was itself uncertain.
4. The sums invoiced by Ms O’Reilly were unlikely to be recoverable. She was not a solicitor, was not SRA-regulated and was not authorised to conduct reserved legal activities. The claimed legal work was work which a legal representative would ordinarily perform rather than recover as a disbursement. The claimed expert disbursement was also unsupported by sufficient information about the expert, instructions or advice.
5. The court declined to order an immediate detailed assessment. The costs would proceed in the ordinary way, and the substantial set-off arising from Hudson’s unpaid costs liabilities also meant that a modest interim payment would serve little practical purpose.
6. Hudson was ordered to pay Invenia’s costs of the extension application. His refusal to agree a modest extension, sought for good reasons and involving no prejudice, was unreasonable. Civil litigation requires reasonable conduct, including avoiding disproportionate disputes over minor procedural matters.

First-instance decision. No appellate history is stated in the judgment.