Benjamin Abbey v Associated Foreign Exchange Ltd

Facts

The appellant (X) appealed against a decision to award costs against him and against an order that his solicitors (L) should pay those as wasted costs.

X had unsuccessfully brought a claim against his former employer (E) in the county court. He was ordered to pay costs, and L were ordered to pay those as wasted costs. L did not oppose the wasted costs order. However, they applied to a circuit judge for permission to appeal against the orders, ostensibly on behalf of X. A directions hearing was held, which E attended and prepared a bundle for. At that hearing, the judge ordered that the question of whether X was the appropriate appellant should be tried as a preliminary issue. At the substantive hearing, permission was refused on the grounds that X was not the correct appellant, E was awarded its costs of the hearing and the directions hearing, and L were ordered to show cause why a further wasted costs order should not be made against them. They neither showed cause nor attended the subsequent hearing, and the wasted costs order was made.

L argued that (1) E should not have their costs of attending the directions hearing or preparing the bundle, since the hearing was of merely an application for permission to appeal; (2) the wasted costs order should not have been made without their being given details of what they had done wrong.

Held

(1) The appeal against the costs orders was hopeless. Although respondents could not usually expect to recover their costs of attending a permission hearing, the hearing had been listed expressly for directions. As well as the issue of permission there had also been the question of whether the appeal had been brought by the right person. There was no reason why E should not have attended that hearing and every good reason why it should. The bundle had been there to assist the judge to make what was a complicated directions order. Moreover, costs was an area where an appellate court would rarely interfere with the order of a lower court, it being an area of very broad discretion. (2) There could have been no plainer indictment of L than that contained in the order itself: a declaration that the case had been brought by the wrong appellant, that it should not have been brought in X's name, and that there was a patent conflict of interest given that if L successfully appealed against the wasted costs order, the costs would fall on X. That conflict was continuing, since L continued to act for X in the instant appeal. Furthermore, the judge had delayed making the wasted costs order to enable L to defend themselves, but they had not done so.

Appeals dismissed.

Comment

An appeal against a wasted costs order was dismissed. The order had been made after an unsuccessful appeal, brought by solicitors ostensibly on behalf of their client, against an earlier wasted costs order. The solicitors should have brought the appeal themselves, and there was a conflict of interests between them and the client.