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Claim No. CFI 005/2021

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF FIRST INSTANCE

BETWEEN

(1) ANOOP KUMAR LAL
(2) PAUL PATRICK HENNESSY

Claimants

and

DONNA BENTON

Defendant

ORDER WITH REASONS OF JUSTICE ROGER GILES

UPON reviewing the Claimants’ Application No. CFI-005-2021/5 dated 14 September 2021 for a de novo review pursuant to Practice Direction No 3 of 2015 against the Order of the Registrar Nour Hineidi dated 8 September 2021 (the “Application”)

AND UPON reviewing the Defendant’s evidence in answer to the Application dated 19 September 2021

AND UPON reviewing all documents filed and recorded in the court file

IT IS HEREBY ORDERED THAT:

1. So far as necessary, extend the time for filing and serving the request for reconsideration de novo until 14 September 2021.

2. Quash the decision of the Registrar issued on 8 September 2021.

3. In lieu of the decision of the Registrar:

4. Make no order as to the costs of the request for reconsideration de novo.

5. Order that the costs the subject of order 3 be paid within 14 days of the date of this order and if unpaid bear interest at 9% per annum thereafter until payment.

Issued by:
Nour Hineidi
Registrar
Date of issue: 28 September 2021
At: 1.15pm

SCHEDULE OF REASONS

1. This is the reconsideration de novo, at the Claimants’ request pursuant to Practice Direction No. 3 of 2015 (“PD3”), of an assessment of costs by a Registrar. Such a reconsideration is on the materials before the Registrar, with regard to the reasons for the application put forward by the Claimants in an undated document filed together with their Application Notice and to the Defendant’s reply dated 19 September 2021. While I pay regard to the Registrar‘s decision, as a reconsideration de novo I consider the matter afresh and come to my own decision.

2. The Claimants filed an application for immediate judgment but failed duly to serve it. The Defendant appears to have been on notice of the application, but advised the Registry of the failure in service, whereupon the Registry issued a direction for immediate service. On the next day, 29 April 2021, the Claimants advised the Registry, copied to the Defendant, that they intended to withdraw the application. They submitted a draft consent order to the Defendant. The Defendant submitted an amended draft order, in the covering email saying that the Claimants should bear the costs of the application, from which I infer that the original draft did not so provide. The Claimants asked for a quantification of the costs, which was provided on 9 May 2021 in an amount of AED 24,715. The Claimants did not agree to it. There was more correspondence, including with the Registry and it appears on matters in the draft other than costs. Eventually, on 18 May 2021 an agreed consent order was issued, relevantly providing that the Claimants pay the Defendant’s:

“… costs of, and occasioned by, this application for immediate judgment within 14 days of this order, to be summarily assessed if not agreed”.

3. The Defendant sought compliance with the order, and on 26 May 2021 provided a further quantification of costs, increased to AED 44,160 for work done since 9 May 2021 and its own preparation. The Claimants responded that they would only pay AED 1,000. The Defendant then wrote to the Registry requesting a summary assessment in accordance with the order, with a costs statement increased again to AED 69,578.92 for work in preparation of the request. The Registry required the filing of an Application Notice, which was done on 28 July 2021, with the claimed costs increased by the fee of AED 1,101.90.

4. The parties filed materials for the purposes of the assessment. The Registrar‘s decision was issued on 8 September 2021.

5. By paragraph 5 of PD3, the request for reconsideration de novo had to be filed and served within three working days thereafter. It is not clear whether that was done. An Application Notice was filed on 14 September 2021, but that may not have been necessary (see note [8] to paragraph 5 in PD3) and there may have been a prior request. No point was taken, and so far as necessary I will extend the time until 14 September 2021.

6. The costs of and occasioned by the application for immediate judgment run to the point of agreement on and filing of the consent order; costs from then on are referable to the assessment process. For assessment of the amount of costs pursuant to the order, regard is to be had to the matters in RDC 38.21– 38.25; in essence, to arrive at a reasonable amount for work reasonably done, proportionate to the matter at stake. In relation to the costs of the assessment process, it is necessary to decide how the burden of costs should fall between the parties, as well as arriving at an amount of costs again with regard to those matters.

7. The claimed amount for costs pursuant to the order is the AED 24,715 plus some part of the increase of AED 19,445 to the next figure of AED 44,160. Debate in this period over the quantification of costs, by the Claimants’ conduct if not in any event, was part of agreeing on the consent orders. Much more was involved than the AED 1,000 proposed by the Claimants would recognise. The Defendant could reasonably have made a brief assessment of the application for immediate judgment, she thereafter engaged in a course of correspondence concerning the consent orders including providing the costs quantification at the Claimants’ request, and there would have been occasion for some attendance on the Defendant to obtain instructions. Little of this would have required the attention, beyond supervision, of a Partner, or extensive time. In my view a reasonable and proportionate amount is AED 13,000.

8. Turning to the assessment process, the Defendant does not automatically recover whatever is a reasonable and proportionate amount in relation to the process. To illustrate, if the assessment of costs pursuant to the order had been that the Defendant was entitled only to the AED 1,000 offered by the Claimants, the exercise of the discretion as to costs may have resulted in nil recovery or payment of costs to the Claimants. However, that was not the case. While the AED 13,000 is approximately half the claimed costs referable to costs of and occasioned by the application for immediate judgment, the Defendant offered to accept a lesser sum than the claimed costs, and the assessment was necessary because of the Claimants’ intransigence in their adherence to the unreasonable AED 1,000. I consider that the Defendant is entitled to recover the full amount of her costs as assessed.

9. The claimed amount is some part of the AED 19,445 plus the increase of AED 25,418.92 to the next figure of AED 69,578.92, plus the fee of AED 1,101.90. The assessment application was preceded by some appropriate correspondence, and was supported by a detailed Witness Statement of Antonia Birt of the Defendant’s lawyers. The Defendant would reasonably have had to consider the Witness Statement of Kanmani Sukumaran of the Claimants’ lawyers and the Claimants’ submissions filed in reply to the application; it was reasonable for her to file a response in the Second Witness Statement of Antonia Birt; and some attendance on the Defendant for instructions was appropriate. I am unable, however, to see hours of work at the charge-out rates in the costs statement reasonably expended in order to arrive at more than an amount of AED 25,000. Although this exceeds the AED 13,000 at stake, as now determined, I consider this is proportionate (cf RDC 38.25) as well as reasonable. The fee should be added to this.

10. The costs amounts are exclusive of 5% VAT, an amount which the Defendant also claimed. The Registrar added VAT, the Claimants did not suggest otherwise, and I also add it. The amounts payable by the Claimants are therefore AED 13,650 as the costs of and occasioned by the application for immediate judgment and AED 27,351.90 as the costs of the assessment, a total of AED 41,001.90.

11. It is then necessary to address the costs of the request for reconsideration de novo. Neither side filed a statement of costs in accordance with paragraph 5 of PD3, but how the burden of costs should fall must first be decided. The Registrar came to an amount of AED 48,500.40. That has been reduced by about 15%, a degree of success potentially bringing costs following the event. But the success in that respect has had little to do with the Claimants’ reasons put forward for the application, which contended for complete dismissal of any costs in the Defendant’s favour and, while I have had regard to them, were of little assistance. In my view, no order for the costs of the application should be made, so that the parties bear their own costs.

12. This is a summary assessment and a summary disposal of costs, and no encouragement should be offered to satellite litigation over costs by my giving extensive reasons – indeed, the course of events maybe thought to show how such litigation can profit only the lawyers. But I consider that two matters are deserving of mention.

13. First, a significant element in the Defendant’s reply dated 19 September 2021 was that no error was shown in the exercise of the Registrar’s discretion, with reference to authorities concerning appellate interference in a discretionary costs decision. This failed to appreciate that the application was not an appeal, but invoked the entitlement to reconsideration de novo afforded under PD3. Perhaps putting aside a demonstrably pointless request, the entitlement is to fresh consideration by a Judge of a judicial decision made by a Registrar, not to review for error.

14. Secondly, and for the assistance of the profession beyond the present parties, the Claimants’ reasons for the application included unwarranted assertions which had and have no part in the conduct of litigation. It was said that the Defendant had “abused the framework of the justice system to unreasonably withhold a simple consent… and manipulated the court into awarding unreasonable costs“, and that her lawyers had failed to adhere to the mandatory code of conduct and instead “tried to use the situation to create a hostile environment and to arm-twist the Claimant to drop the case”. There was no basis for these assertions, which should not have been made. Perhaps predictably, they brought a responsive assertion that the Claimants had sought at every possible opportunity to contest, disrupt, and reject any approaches by the Defendant in respect of costs, an excess which it would be better had it been resisted. Robust advocacy on behalf of the client should not transgress professional propriety.

15. I make the following orders: