Defendant’s poor conduct penalised by costs order
Defendant’s poor conduct penalised by costs order. It is well known that litigation can be extremely time consuming and costly.
The general rule for costs is that the ‘loser’ pays the ‘winner’s’ costs, whether it be the claim as a whole or an application within a claim. Similarly, if and when a claimant issues a claim and later discontinues that claim, the usual rule is that the claimant pays the costs of the discontinuance and all parties costs up to that discontinuance. However, the court may look more closely at how parties in litigation behave and whether this should be recognised in a costs order. Poor or unreasonable conduct may well be penalised by the court. This is a hot topic in Ashtons’ Dispute Resolution team currently following the reported case of Hewson v Wells & Others which is a case managed by one of our lawyers, Joanna Baker.
Joanna had been dealing with a case for client ’K’ who was in a long-term ’common law’ relationship for in excess of 20 years when her partner ’J’ died.
We often hear the term ’common-law wife or husband’ used to refer to long-term (unmarried) partners. But what does this mean? What protection do they get when the partner dies? Do your belongings and assets automatically pass to them if you do not make a Will? The simple answer is no; the term common law ironically means nothing in actual law. In these circumstances, the Intestacy Rules apply. These are a set of rules that determine how your estate will be shared between your relatives when you die depending on your personal circumstances.
K & J were long-standing cohabitees living just as a married couple would – moving from house to house, pooling resources and sharing a variety of animals and making life plans together. So what did our client K receive when J died? Nothing. This is despite promises being made and a “Deed” specifically being signed to protect K should J die and enabling her to remain at the couple’s home for the rest of her life.
K issued proceedings claiming an interest in a property and a claim under the Inheritance (Provision for Family and Dependants) Act 1975 for ‘reasonable provision’ from the estate which was defended rigorously by the sons and widow of J (that our client K thought was actually an ex-wife)! The case has been eventful. Despite K vividly recalling that a Deed was signed by her and J setting out their intentions regarding the ownership of the property, K could not find a copy of this. K made numerous requests to inspect an original deed that dealt with ownership of the property but the defendants insisted that they did not have this. K had no option but to issue proceedings without sight of the deed, but relying upon it for protection from eviction from the property as she was promised a lifetime interest to stay there until she died. There was some delay but eventually, a legible and full copy was sent by J’s sons and to our client’s surprise, this did not give her the lifetime interest that she was told it did before she signed it. Suddenly, her case was flawed and her claim needed to be reviewed. K later discontinued the claim for an interest in the property (but not the Inheritance (Provision for Family and Dependants) Act claim) and, at the same time, made an application for the usual rule – that a claimant pay costs when discontinuing – be dis-applied under the circumstances. Had K had sight of the deed before she issued proceedings she would not have pursued that aspect of the case.
The application from September 2018 was finally heard in August 2020 after a considerable delay in the County Court and the matter being transferred to the High Court and in Hewson v Wells & Ors  EWHC 2722 (Ch) Master Clark varied the usual rule and made no order for costs following the claimant’s discontinuance.
The Master stated: “In my judgment, the change in circumstances was brought about by unreasonable behaviour by the defendants. The defendants’ solicitors did not properly engage with pre-action correspondence…
For the reasons I have given, I consider that this is an appropriate case to disapply the default rule as to costs on discontinuance. The fact that most of the evidence to date will be relevant and admissible in the 1975 Act claim means that no order as to costs would not in my judgment be the appropriate order. That fact should, in my judgment, be reflected in an order that the costs of the discontinued claims are costs in the case”.
The key to the variance from the usual rule was the change in circumstances and the unreasonable behaviour of defendants and their solicitors. This is a fine example of where the Court can, and will, punish poor litigation conduct. The Appeal is pending…
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