Practical Law

In the recent case of R (Kuznetsov) v London Borough of Camden, both the claimant and defendant parties fell foul of the rules for filing a form N260: Statement of Costs (summary assessment), and paid the penalty accordingly. So, when should you file an N260?

Background

CPR 44.6(1) states that where the court orders a party to pay costs to another party (other than fixed costs), it may either summarily assess those costs or order a detailed assessment.

The accompanying Practice Direction (PD) 44, states, at paragraph 9.2, that:

“The general rule is that the court should make a summary assessment of the costs –

(a) at the conclusion of the trial of a case which has been dealt with on the fast track, in which case the order will deal with the costs of the whole claim; and

(b) at the conclusion of any other hearing, which has lasted not more than one day, in which case the order will deal with the costs of the application or matter to which the hearing related. If this hearing disposes of the claim, the order may deal with the costs of the whole claim,

unless there is good reason not to do so, for example where the paying party shows substantial grounds for disputing the sum claimed for costs that cannot be dealt with summarily.”

It is common knowledge amongst solicitors operating in the Fast Track arena that, for a trial, an N260 statement of costs needs to be filed at least two days in advance, pursuant to paragraph 9.5(4)(a) of PD 44. However, what sometimes gets overlooked is that paragraph 9.5(4)(b) provides that, for all other hearings lasting not more than a day, an N260 has to be filed at least 24 hours in advance of the time fixed for the hearing.

Essentially, if there is an interlocutory hearing with a discrete point where parties are going to be seeking for the other side to pay costs (for example, if there is an application being heard), you need to file an N260 in advance of the hearing.

Facts and judgment

In Kuznetsov, the parties attended an application hearing (before Mostyn J), which was listed to take place for one hour. Neither party filed a statement of costs.

The judge referred the parties to paragraph 9.5(1) of PD 44, and the duty that that paragraph imposes upon them to assist a judge in making a summary assessment of costs, by filing a statement of costs. It was decided that due to the failure to file an N260, neither party would be entitled to the costs of the hearing. Mostyn J went on to comment that:

“Where the court is charged with a duty to bring closure by summary assessment, and where there is a positive duty to file a Form N260, the legal advisers having failed to do so they, having made that bed, must lie in it and they will not get an award of costs.”

It should be noted that, under paragraph 9.9(1) and 9.9(2) of PD 44, the court will not make a summary assessment of the costs of a receiving party who is a child or protected party within the meaning of CPR 21, unless the legal representative acting for the them has waived the right to further costs. Summary assessment of costs payable by a child or protected party can still take place.

Comment

Mostyn J’s decision is a timely (and potentially expensive) reminder to parties that the summary assessment provisions have teeth and that it is not therefore sensible to ignore them.