Patel and others v Awan and another [2024] EWHC 464 (Ch)
The proceedings related to Part 8 claim for an order sale in respect of a property in Clapham. The matter proceeded to Trial and the Claimants were successful. The final Order provided that the Defendants be jointly and severally liable to pay the costs of the Claim, Counterclaim and Additional Claim, on the standard basis to be assessed if not agreed and that they pay the sum of £118,800.00 on account of the costs by 4pm on 10 November 2017.
When the Judge; Master Kaye, came to consider CPR 44.2(8) in respect of the interim payment, she referenced CPR 44.2(8) that where the court orders a party to pay costs subject to detailed assessment, the court will order the paying party to pay a reasonable sum on account of costs, unless there is good reason not to do so. The objective of the rule was to enable a receiving party to recover part of their costs expenditure before the possibly protracted process of detailed assessment. Embedded in this objective was that was that such interim payments were enforceable in a manner that required payment of the reasonable sum determined by the court. The determination of what was a reasonable sum to award under CPR 44.2(8) was not a mere conjecture. It was a binding judicial determination based on the circumstances of the case and the likely level of recovery on assessment. The Defendants had, had an opportunity to make representations regarding the sum ordered. The amount determined became payable and due on the date for payment.
She ruled the interim payment was an enforceable order, notwithstanding the reference to “on account” and irrespective of whether detailed assessment proceedings had concluded.
Master Kaye ruled that if the payment ordered remained unpaid after the due date, then it was enforceable in the same way as any other money judgment or order under CPR 70.2. The impact of this ruling meant that the Claimants were within their rights to seek an order for sale against the first Defendant’s property to enforce a charging order securing the sum payable under an order for payment on account of costs.
Master Kaye considered that a payment on account of costs was not a contingent liability dependent on the ultimate result of any detailed assessment. It was a final judicial determination or decision of a reasonable sum to be paid by the paying party.
Master Kaye provided corroboration from personal injury cases, where she stated
‘it would be nonsense to suggest, for example, that an award of interim damages to provide for ongoing care in a serious personal injury or medical negligence case was not due and enforceable if not paid…this would fundamentally undermine the concept of interim payments and the policy behind them’.
Commentary
The case clearly provides a warning to lawyers that where an interim payment is ordered, it is wholly enforceable if unpaid, regardless of whether assessment proceedings have concluded or not.