Charles Elphicke v Times Media Ltd

On discontinuance, the presumption that the claimant pays the defendant’s costs may be displaced where the defendant’s conduct provides a cogent and unusual reason to do so. The court may consider conduct occurring after discontinuance, provided the application to revisit the deemed costs order remains live. A causal connection with the discontinuance is usual but not mandatory.

Serious failures to preserve relevant evidence and wrongful collateral use of witness statements may open the gateway to a different costs order. The resulting sanction must be proportionate. Other disputed misconduct, especially matters requiring detailed factual investigation, may be left to the Costs Judge. Before detailed assessment, the court may require meaningful ADR concerning the costs.

The claimant brought defamation proceedings concerning articles published by the defendant. He discontinued the claim before trial. Under Civil Procedure Rules 1998, the ordinary consequence was a deemed order requiring him to pay the defendant’s costs.

The claimant applied to depart from that order and opposed the defendant’s application for an interim payment on account. He relied on alleged misconduct, including admitted collateral use of witness statements and failures to preserve evidence. He also raised alleged failures of pre-action conduct and ADR.

The court also considered recusal, reporting restrictions, the scope of the costs jurisdiction after discontinuance, and whether costs disputes should undergo ADR before detailed assessment.

1. Recusal. The judge declined to recuse herself. Having excluded the sensitive issues concerning the rape complainant from her own reasoning and left them to the Costs Judge, a fair-minded and informed observer would not consider there to be a real risk of bias. The first duty of a judge was to decide the case and give reasons. Recusal would also waste substantial judicial and party resources.
2. Scope of CPR 38.6. The presumption that a claimant who discontinues pays the defendant’s costs is subject to the court’s discretion. Neither the rule nor Brookes required a causal connection between the defendant’s conduct and the discontinuance. Conduct after discontinuance could be considered because an application to revisit the deemed costs order kept the costs issue live.
3. Relationship with CPR 44.2 and CPR 44.11. CPR 38.6 was the gateway. Costs were not at large under CPR 44.2 unless that gateway was opened. CPR 44.11 was intended to permit the Costs Judge to address unreasonable or improper conduct relevant to the quantum of costs, including conduct between discontinuance and assessment.
4. Conduct. Allegations of lies and other matters pleaded in the abandoned substantive claim were out of bounds because deciding them would re-litigate issues reserved for trial. Alleged failures of ADR and other pre-action conduct did not provide sufficiently cogent reasons on the material before the court. By contrast, the admitted collateral use of witness statements contrary to CPR 32.12 and the failure to preserve potentially relevant evidence after notice of proceedings were serious and unusual breaches which opened the CPR 38.6 gateway.
5. Sanction. The appropriate response was to preserve the substantive costs order but reduce recovery by 20 per cent. The claimant was therefore ordered to pay 80 per cent of the defendant’s costs on the standard basis. The court avoided double punishment and left other alleged misconduct to the Costs Judge.
6. ADR and interim payment. There was a presumption in favour of an interim payment, but its amount remained to be determined. Before detailed assessment, the parties were ordered to engage in meaningful ADR, preferably mediation involving Costs Lawyers. Detailed assessment was stayed or extended until that process ended, unless a party declined to engage and could justify that decision.