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The Court of Appeal, ever anxious to deter expensive satellite litigation, has imposed a procedural straitjacket on parties seeking to recover wasted costs.
Unless such applications can be disposed of in "summary proceedings", they will not be entertained at all. Save in exceptional circumstances, the blameworthy conduct must be readily visible without the need for a lengthy and detailed investigation, as in the 1994 case of Ridehalgh v Horsefield.
But does this straitjacket apply to applications against a non-party under paragraph 48.2 of the Civil Procedure Rules 1998? This was the question for Mr Justice Laddie in Robertson Research International Limited v ABG Exploration BV & ors.
Robertson claimed various sums from ABG, but ABG defended robustly. In May 1999 the master gave directions for a trial to be heard by him at the end of July. In mid-June ABG gave notice that it was ceasing to trade, its solicitors came off the record and it consented to judgment for the entire sum claimed. By then ABG was an empty shell.
Robertson immediately joined a director of ABG and its financial controller. Robertson said these individuals had known that there was no defence and that they should pay Robertson's costs of the action.
Shortly before the hearing of Robertson's application, the defendants argued the hearing should not take place at all given the strictures established by the Court of Appeal in the wasted costs jurisdiction. Although by then the parties and their witnesses were before the court and ready to proceed, the Master accepted these submissions.
On appeal, Judge Laddie held that, so far as costs orders regarding non-parties were concerned, the jurisdiction was solely compensatory. Moreover, unlike the position in the wasted costs jurisdiction, it was irrelevant whether there was any impropriety on the part of those so responsible.
Although such orders would always be exceptional, it was not necessary that the applications, to be heard at all, had to be able to be dealt with "summarily".
The matter could be dealt with appropriately by, for example, limiting it to principal issues, limiting or disposing with cross-examination and limiting the length of the hearing. Robertson's appeal was therefore allowed subject to appropriate directions to keep it within sensible bounds.