Judge “wrong” not to make unless order over unpaid costs

Costs: No evidence claimant could not afford to pay

A circuit judge was wrong not to make an unless order against a claimant who failed to pay the costs of a preliminary hearing, the High Court has ruled.

Overturning the decision of His Honour Judge Gerald, Mr Justice Julian Knowles said there was not the evidence to support a conclusion that it was a breach of the claimant’s right to a fair trial under article 6 to make the order.

GL v PM and BM [2018] EWHC 3502 (QB) was a personal injury claim brought by a housekeeper/cleaner for a family whose 16-year-old son (C) – who suffered from mental health problems – attacked her with a cricket bat.

She first made a claim on the Criminal Injuries Compensation Fund, which led to an award of £10,437, and then sued C’s parents for non-physical injuries and loss of income. The parents dispute the claim and argue that it should be struck out for fundamental dishonesty.

After the limitation period passed, GL applied to add C as a party and disapply limitation. This was rejected by a deputy district judge, who found the application had been improperly made because the aim was to pressurise the parents into a settlement.

Further, there was “compelling” evidence that the claimant was not being honest in her evidence.

The judge made a costs order in favour of C, which he appealed, and eventually HHJ Gerald ordered GL to pay £6,800.

However, the judge refused to order security for costs to continue the claim, but this was overturned on appeal and Mrs Justice Lambert ordered the claimant to pay £3,500, which she has done.

C then sought an unless order that GL pay the outstanding costs or have her claim against the parents struck out.

HHJ Gerald refused this, saying it was “self-evident” that the claimant was “not in a good way”, and that, though there was no evidence before him, “as a matter of common sense… the assault would have had a profound effect on GL’s ability to work”.

If GL were ordered to pay the costs on an unless order basis, the judge continued, “it would almost undoubtedly follow that she would not be able to do so” and she would “therefore be prevented from exercising her human rights under article 6”.

Given that a successful claim would like lead to a “substantial amount of damages”, HHJ Gerald said that, notwithstanding the lack of evidence, it would be unfair to make the order sought.

On appeal, Knowles J said these reasons were “plainly and obviously flawed in a number of ways”.

The principles to be applied as to whether the claimant could not pay costs were analogous to those which apply where a party seeks to avoid an order for security for costs on the grounds of impecuniosity, he said.

GL did not adduce “proper and sufficient evidence” of this before HHJ Gerald or before him. Indeed, bank statements did not help her case, while GL – who was from the Philippines – accepted that she owned properties in her home country which generated income.

Knowles J said: “In the absence of evidence of the required cogency, it was not open to the judge to reach the conclusion that he did… The absence of evidence was not a technicality, as the judge appeared to regard it.”

Another “manifest” error was that HHJ Gerald relied in part on his earlier decision refusing the application for security for costs as support for his approach of deciding the matter without evidence.

“That decision was overturned by Lambert J… The judge’s reliance on his own earlier judgment was therefore misplaced.”

Knowles J ordered that the claimant pay the costs of £6,800 or her claim would be struck out.

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