Amar Lodhia v Twelve Management Company (Bromley-by-Bow) Limited & Ors

Where a claimant discontinues, the starting point is that the claimant pays the defendant’s costs under CPR rule 38.6. Departure requires cogent reasons, usually involving a relevant change of circumstances not caused by the claimant and unreasonable conduct by the defendant. Practical, financial or pragmatic reasons ordinarily do not suffice. The court may determine costs arising from earlier interlocutory applications on their merits, notwithstanding subsequent discontinuance. Costs remain discretionary under CPR rule 44.2, and a reasonable payment on account should normally be ordered where costs are subject to detailed assessment unless there is good reason not to do so. A lasting power of attorney does not, without evidence of incapacity, make a litigant a protected party or require service on the attorney.

The claimant brought defamation and malicious falsehood claims against a management company, its property manager and three individuals concerning statements in a newsletter to leaseholders. The defendants applied for summary disposal and preliminary issues as to meaning were listed. The claimant later amended his claim, abandoning the malicious falsehood claims and claims against two defendants, and subsequently discontinued the proceedings entirely.

The hearing concerned the costs consequences of the amendments, earlier postponement, stay and summary disposal applications, the effect of discontinuance, interim payments on account, and directions for further evidence concerning matters raised by the claimant. The central issues were whether the presumption under CPR rule 38.6 should be displaced and whether the claimant’s bankruptcy or lasting power of attorney prevented costs orders against him.

1. Costs and discontinuance. The claimant was ordered to pay the defendants’ costs. The court applied the presumption under CPR rule 38.6 that a claimant who discontinues pays the defendant’s costs. The claimant had not established a relevant change of circumstances, unreasonable conduct by the defendants, or any other good reason for departing from that position.
2. The claimant’s arguments concerning alleged pre-action breaches, late information, settlement offers, insurance, insolvency, bankruptcy, alleged statements at a residents’ meeting and the lasting power of attorney did not justify a different order. The alleged AGM remarks did not cause the discontinuance and, even if unreasonable, did not amount to unreasonable conduct of the litigation.
3. The claimant was also ordered to pay the costs of the summary disposal application, the amendment application, the discontinuance against the fourth and fifth defendants, and the postponement and stay applications. The summary disposal application had been wholly conceded by the amendments, and the claimant’s conduct had caused the relevant costs.
4. Bankruptcy and capacity. Any costs order against the claimant personally was not a bankruptcy debt because the relevant obligation was not incurred before the commencement of the bankruptcy. The trustees in bankruptcy had not sought to participate. The lasting power of attorney did not establish incapacity, and there was no basis for treating the claimant as a protected party requiring service on his father.
5. Payment on account. Applying CPR rule 44.2(8), the court ordered interim payments of £55,000 plus VAT for the TTMC defendants’ costs to 30 April 2026 and £3,600 plus VAT for Urang’s costs to that date. The costs of the hearing itself were reserved for determination on written submissions.
6. The court directed further evidence concerning the claimant’s bankruptcy correspondence, medical letters, pre-action letters and certificates of service, the role of Mr Chiffers, and matters arising from Steyn J’s earlier order. Liberty to apply was granted.

The proceedings were issued in the High Court on 15 May 2025. Interlocutory applications and listing orders were dealt with by Steyn J, Collins Rice J and Master Armstrong. The claim was discontinued before the present costs hearing. No appeal was stated.