Afan Valley Limited v Lupton Fawcett (a firm) & Ors

A lower court cannot entertain a retrospective application for permission to appeal where no application was made at the original decision hearing and that hearing was not adjourned for the purpose.

In costs matters, the successful party’s entitlement remains the starting point, but the court may make a proportionate adjustment where the successful party failed on substantial, independent issues. The court should avoid an excessively detailed apportionment of costs and may use a percentage reduction where that best reflects the overall justice of the case.

The judgment concerned consequential matters following the court’s earlier decision in Afan Valley Limited v Lupton Fawcett (a firm) & Ors, in which the claim against Lupton Fawcett was struck out and dismissed by summary judgment and permission to amend against Lupton Fawcett and Metis was refused: [2024] EWHC 909 (KB).

The court first addressed whether it had jurisdiction to determine a retrospective application for permission to appeal. It then determined costs arising from the strike-out and amendment applications, discontinued defendants, an extension of time, and an adjourned hearing, together with interim payments and interest.

1. The court had no jurisdiction to entertain a retrospective application for permission to appeal. Under CPR 52.3(2)(a), as explained in McDonald v Rose, where no permission application is made at the original decision hearing and the hearing is not adjourned, the lower court is no longer seized of the matter.

2. Lupton Fawcett was the successful party on the strike-out, summary judgment and amendment applications. The starting point was therefore the general rule that the unsuccessful party pays the successful party’s costs. However, the court exercised its discretion to award 75% rather than 100%. Although the decisive no-loss point had been identified early, Lupton Fawcett had failed on substantial and independent issues, particularly factual causation, which required significant evidence and argument.

3. The court declined to make an issues-based costs order. A finely detailed division would have been difficult, would have used disproportionate court time, and would not have reflected the interrelationship of the evidence or the overall justice of the case. A percentage reduction was the appropriate practical method.

4. Interim payments of 50% were ordered for Lupton Fawcett’s and Metis’s costs, because detailed assessment might materially reduce the sums claimed but there was no good reason to withhold payment on account. The discontinued defendants were entitled to their costs. The claimants were ordered to pay the costs of the extension application and the costs thrown away by the adjournment.

5. Interest at 2% above base rate was appropriate on costs incurred by insurers. The court adopted the principle in Fosse Motor Engineers Ltd v Conde Nast and National Magazine Distributors that the fact that insurers funded the defence did not prevent interest being awarded.

The judgment itself was a consequential decision following the court’s earlier judgment, which struck out and summarily dismissed the claim against Lupton Fawcett and refused permission to amend against Lupton Fawcett and Metis: [2024] EWHC 909 (KB).