3.1 Precedents cited and how they shaped the decision
Ainsworth v Stewarts Law LLP [2020] EWCA Civ 178
Ainsworth was central to the dispute because it emphasises that points of dispute must enable the parties and the court to
know “precisely what is in dispute and why”, reflecting PD 47 paragraph 8.2. In Ward v Rai, the Court of
Appeal accepted the practical reality that the relevant point was incomplete (it referenced a schedule that was missing), and reiterated
that paying parties should not assume indulgence for non-compliance. However, Ainsworth did not establish a rule that
non-compliance automatically requires strike-out; it recognised the court’s discretion, including strike-out as one
possible response.
These cases supplied the controlling appellate framework for discretionary case management decisions: an appellate court may interfere only
for misdirection in law, taking irrelevant matters into account, failure to consider relevant matters, or a decision that is plainly wrong
(outside the generous ambit of reasonable disagreement). The Court of Appeal applied that framework to conclude the High Court had
impermissibly re-weighed factors and substituted its own view.
Cited by analogy (“island-hopping” versus seeing the “sea of evidence”), FAGE supported institutional caution:
appellate courts are not “on the ground” and are vulnerable to hindsight and to refined arguments not developed below—especially acute in
case management appeals.
The Court invoked In re A (Children) to emphasise counsel’s responsibility to seek clarification of omissions or
ambiguities in an ex tempore judgment. This procedural theme reinforced the Court’s reluctance to entertain appellate criticisms based on
asserted deficiencies that were not raised promptly with the Costs Judge when they could have been addressed.
Mentioned in the High Court grounds, but its role in the Court of Appeal’s reasoning was limited. The Court of Appeal focused instead on
whether the Costs Judge’s evaluative criticisms of both parties’ conduct (including not “chasing” the schedule) were matters he was
entitled to take into account in the exercise of discretion.
O'Sullivan v Holmes and Hills LLP [2023] EWHC 508 (KB)
Relied on by the receiving party to argue for a “binary” compliance determination before the discretion stage (and to characterise the late
schedule as “curative” rather than “augmentative”). The Court of Appeal did not accept that the Costs Judge committed a legal error by not
adopting that structured approach as a rigid requirement; it held he proceeded on the practical basis that the point was incomplete and
still permissibly exercised his discretion as to consequences.
These post-2013 “culture change” authorities were used to argue for a stricter approach to procedural non-compliance, including scepticism
that costs sanctions are always adequate. The Court of Appeal accepted the underlying policy but held it did not compel a single outcome in
the present Part 47 context; the Costs Judge could still decide that costs conditions and adjournment were a proportionate response.
The Court of Appeal used Celtic Bioenergy to underline that PD 47 paragraph 13.10 confers a wide
discretion: there will be cases where a document is “just too late”, but that does not mean it is always too late. The point supported the
proposition that different judges may legitimately reach different results on similar facts.
3.2 Legal reasoning
(a) The governing question: was the Costs Judge’s decision one he could properly make?
The Court of Appeal treated the appeal as turning on the limits of appellate review in a second appeal from a discretionary
costs case management decision. Even if the High Court strongly disagreed, the correct question was whether the Costs Judge’s decision was
infected by legal error or was outside the “generous ambit” of discretion.
(b) PD 47 paragraph 8.2(b) and “Ainsworth compliance”
The Court accepted that the paying party’s point was incomplete (it referred to a schedule not served), and that PD 47 requires focused
identification of the nature and grounds of dispute. However, the Court declined to convert that requirement into a rule of automatic
strike-out. In this case, the Costs Judge:
- recognised the significance of the missing detail and the lateness of service;
- evaluated whether the receiving party broadly understood the challenge and could meet it (including in a broad-brush way);
- took into account both parties’ conduct, including the receiving party’s failure to pursue the promised schedule; and
- concluded that, given an adjournment was inevitable, the court would be assisted by permitting reliance on the schedule, with sanctions later.
That evaluative balancing was not a misdirection or a failure to apply Ainsworth; it was an exercise of discretion about consequences
of non-compliance.
(c) PD 47 paragraph 13.10: variation without permission, but subject to disallowance/conditions
The annotated schedule functioned as a late variation/supplement within the Part 47 process. PD 47 paragraph 13.10(2) allows the court to
disallow the variation or permit it on conditions, including costs. The Court of Appeal stressed that this is a broad discretion to be
exercised case-specifically; the High Court erred by treating the overriding objective and compliance imperatives as if they compelled
strike-out on these facts.
(d) The “third day” and the High Court’s mis-framing of causation and prejudice
A pivotal point was the High Court’s reasoning that the late schedule necessitated an adjournment and third hearing day, and that striking
out would have avoided that. The Court of Appeal considered this an unsafe platform: even if the schedule had been timely, the dispute was
large and detailed enough that a third day would likely have been required anyway. The relevant inquiry was therefore the incremental
prejudice and cost caused by lateness (preparation, interruption, and settlement dynamics), which the Costs Judge had addressed through
adjournment and contemplated costs consequences.
(e) Procedural discipline in appeals: seeking clarification and avoiding hindsight
The Court’s emphasis on the ex tempore nature of the Costs Judge’s ruling, the incomplete record of submissions, and the failure to seek
clarification (including not pursuing permission to appeal at the time) served two functions:
- it explained why appellate courts should be slow to criticise reasoning in pressured case management contexts; and
- it underscored that parties should address alleged ambiguities or omissions promptly, rather than building refined appellate arguments later.
(f) The Respondent’s Notice (curative vs augmentative)
The Court recorded the receiving party’s contention that variations should be categorised as “curative” or “augmentative”, but the decision
ultimately turned on the breadth of the Costs Judge’s discretion and the appellate restraint principles, rather than on adopting a mandatory
taxonomy that would constrain permissible outcomes.