HE Winros Partnership v Global Energy Horizons Corporation

A Henderson v Henderson abuse of process may arise where a party, without good reason, fails to raise an issue capable of determination in earlier proceedings, and later determination causes procedural waste without sufficient justification based on fairness or due process.

In assessing an appeal from an evaluative judgment, the appellate court asks whether the lower court adopted an impermissible approach or reached a legally indefensible conclusion, rather than whether it would have made a different assessment. Where the late issue should have been dealt with at an earlier liability hearing, striking out may be the appropriate sanction. That conclusion may nevertheless be displaced where the delay resulted from the court’s own case-management directions and it would be procedurally unfair to preclude the issue.

The appellant solicitors acted for the respondent in earlier litigation under conditional fee agreements. After the retainer dispute reached the Senior Courts Costs Office, the respondent raised an objection to the solicitors’ costs bills during detailed assessment. The appellant contended that the objection was an abuse of process because it could and should have been raised during an earlier preliminary-issues hearing and appeal.

The Senior Costs Judge rejected the abuse argument. The appellant appealed that decision. The present appeal concerned only the abuse point; the appeal concerning the substantive costs objection was to be heard separately. The central issue was whether the late raising of the objection constituted a Henderson v Henderson abuse, and whether the procedural history supplied sufficient justification for allowing it to proceed.

1. Permission and standard of review. Permission to appeal the abuse point was granted. The appeal concerned an evaluative judgment. The question was whether the Senior Costs Judge’s approach was such that no reasonable judge could have adopted it, or whether the decision was legally indefensible, applying the approach illustrated by Wheeldon Bros Waste Ltd v Millenium Insurance Co Ltd [2018] EWCA Civ 2403 and MW High Tech Projects UK Ltd v Outotec (USA) Inc [2024] EWCA Civ 844.
2. Henderson abuse. The jurisdiction arises where, without good reason, a party fails to use an opportunity to bring an issue before a competent court, the issue remains unresolved until later, and its later resolution causes procedural waste without sufficient countervailing justification based on procedural fairness or due process. The Senior Costs Judge’s focus on whether the objection had previously been decided, whether earlier decisions would have differed, and whether the earlier hearings would still have occurred misconceived the jurisdiction. The relevant question was whether the opportunity to resolve the issue had been wrongly forsaken.
3. Proper sanction on the initial procedural history. On the Senior Costs Judge’s stated facts, the objection could and should have been raised before Master James, so that it could have been considered on appeal. If that had been the whole procedural history, striking out would have been the appropriate course, and a costs order would not have adequately addressed the years of unnecessary proceedings.
4. Procedural fairness and court-caused delay. The detailed procedural history materially altered the result. Master James had directed particular preliminary issues before the parties had pleaded their liability cases, and the parties were properly following that order. It would have been improper for the respondent to introduce an additional issue into a hearing expressly confined by the court’s directions. The court’s case management error explained why the objection was raised late and meant that precluding it would be unfair.
5. Disposition. Although the Senior Costs Judge’s reasons were legally erroneous, the decision could be upheld on the procedurally fair basis identified by the appellate court. Permission was granted, but the appeal was dismissed.

• Senior Courts Costs Office: The Senior Costs Judge rejected the abuse of process argument in the decision dated 29 February 2024 and allowed the substantive costs objection, assessing the relevant invoices at nil.
• Chancery Appeals: Permission to appeal the abuse point was granted, but the appeal was dismissed. The substantive appeal concerning the costs objection was reserved for a separate hearing.