Debra Ellen Packer v Lynn Ann Packer

On an interlocutory amendment, the court will ordinarily order the amending party to pay the costs of and occasioned by the application. It should not normally determine liability for costs already incurred in the wider claim unless it is reasonably clear that those costs would be awarded in the same way at the conclusion of the litigation. That issue is generally better left to the trial judge. A party alleging fraud must have credible material to support the allegation. The fact that an allegation was reasonably made, and is later withdrawn when further information emerges, does not by itself justify departing from the general costs rule.

The claimant sought letters of administration in relation to her late husband’s estate. The defendant relied on alleged wills and defended the claim. In her Reply, the claimant alleged that the defendant had fraudulently created the alleged wills. After metadata supported their dates of creation, the claimant accepted that the allegation lacked a proper basis and applied to amend the Reply to withdraw it. The defendant consented to the amendment but sought the costs of the application and a proportion of costs previously incurred in answering the fraud allegation.

The court therefore had to determine the costs of the amendment application and whether it should make an order at that stage concerning costs incurred in the wider proceedings.

1. Costs of the application. The claimant obtained permission to amend by withdrawing an allegation which she could no longer properly maintain. Applying the general rule, she was ordered to pay the defendant’s costs of and occasioned by the application on the standard basis.
2. Earlier costs. The court preferred the approach in AB v Goldsmith Williams [2015] EWHC 1559 (Ch). Although the court had jurisdiction under section 51(1) of the Senior Courts Act 1981 to make an order affecting costs incurred in the claim, it should normally refrain from doing so on an interlocutory amendment application unless it is reasonably clear that those costs would in any event be awarded in the same way at the end of the litigation.
3. The approaches in Begum v Birmingham City Council [2015] EWCA Civ 386 and Beoco Ltd v Alfa Laval Co Ltd [1995] QB 137 concerned costs of the whole proceedings after trial and did not determine the present interlocutory question. The approach in R G Carter Projects Ltd v CUA Property Ltd [2020] EWHC 3417 (TCC) did not justify ordering payment of earlier costs here, particularly because the substance of the claim remained unchanged and the defendant had produced no reliable evidence for her estimate of wasted costs.
4. The issue of any costs attributable to the abandoned allegation remained open for consideration at the conclusion of the trial.
5. The allegation of fraud was not reasonable in the circumstances. Fraud is serious and must be supported by credible material. Once the claimant had the documents but considered metadata necessary before alleging fraud, she should have waited for that metadata. Even reasonable pleading would not, by itself, justify departure from the ordinary rule for the amendment application.