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Are Costs Orders Causing You an Enforcement Headache?

So you have diligently gone through your compliance for taking on a client, and explained the risks of litigation.  The client half hears you.   They are focused on winning but also making sure you get paid.  Litigation is not for the faint hearted is it? Claire Sandbrook

Either way you know that at the end of the case there is going to be a hurdle to jump on the issue of who pays who.  Take these three simple scenarios:

If your client wins you want to have access to easy funding which meets the cost of the proceedings. 
If your client wins but funding is not in place, you will be looking to the loser to pay the costs, which have to be assessed unless they can be agreed. 
Worse still, if your client loses and funding is not in place, well we all know how uncomfortable that conversation can be.

Now we can’t promise you that we can solve all your cost dilemmas but one of them we can help you with is the enforcement of the costs order in favour of your client.

In fact, we have a few strategic thoughts which our CEO, Claire Sandbrook, has used in the past to support our professional clients when it comes to enforcing costs orders. 

Firstly, if you win your litigation and obtain a judgment on the merits, we don’t recommend waiting for the costs to be assessed, before you start any enforcement procedure.  Instead, get started on enforcing the judgment in the main action.  It’s tough enough to get the money and actually enforcement can bring the parties to the table to settle the judgment, at which point the outstanding costs can be included as part of the overall outcome. 

We did such a deal 4 years ago by seizing a Gulfstream jet, with a judgment debt of over £7,000,000 (give or take a few thousand pounds).  The client had the benefit of a costs order in the sum of £150,000 but was still waiting for it to be assessed, two years after the default judgment had been entered in the Commercial Court.  By seizing the aircraft and keeping it on the ground until the Writ of Control was paid, we were able to negotiate for the outstanding costs to be paid at the same time.  Needless to say our client was overjoyed with the end result. 

Secondly if you are sitting on costs orders which are a bit “long in the tooth” dig them out of your filing system and send them to us for a free no-obligation review.  We can check the situation of your target judgment debtor and do ALL the paperwork for you to convert your Costs Order into a Writ of Control.  There is no need for you to prepare anything – we do the lot!  The only charge is a £66 fee to issue the Writ of Control in the Action Department at the RCJ, and after that the only further risk on costs is the £75.00 Compliance Fee which will need to be paid if we aren’t able to enforce your Order. 

Thirdly the other tricky area is the amount of interest which runs on costs orders.  The bigger the value the bigger the bill for interest.  In Involnert Management Inc -v- Aprilgrange Limited [2015] EWHC 2834 (Comm) the judge decided that whilst the strict rule remained that interest under the Judgments Act 1838, was the “default” position, the Court could decide to vary this date.  The judge held that exceptional circumstances were not needed for the Court to use its discretion to order that costs should run from a different date (subject of course to the overriding objective being applied). Shergroup

So whatever cost order challenges you and your clients face, we can definitely help you get your enforcement into the right form and with all the figure and interest checked and approved by Central Office at the RCJ.  We realise there’s a lot to do before it gets to us, but once you get that all important piece of paper saying costs have to be paid, send it to us for our free expert review.  We have helped many solicitors and their clients over the years to achieve a successful outcome to brainache of enforcing costs orders. 

In the end if we can’t enforce the Order it will have cost only another £156.00 to get one of our enforcement agents on the doorstep to find out what is going on and show your client you did your best!  Sometimes in enforcement even we can’t get blood out of a stone!




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