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Home > Judgments > 2019 archive

Timokhina v Timokhin [2019] EWCA Civ 1284

An appeal by Anna Timokhina, the mother, in relation to an order that she pay £109,394 in respect of the costs of Alexander Timokhin, the father, incurred during the course of litigation concerning the future arrangements for the care of their children. Considerations in relation to costs principles.

Brief facts

Both parents are Russian. They relocated to London in 2004 with their two children, MA (15) and MR (rising 8). Following the breakdown of marriage bitter proceedings ensued in relation to the arrangements for the children. The father applied for permission to remove the children permanently to Russia to live with him. During the course of the proceedings the mother travelled to Russia where she was arrested after attempting to bribe a police officer to instigate criminal charges against the father in order to further her own claim on the children. The mother was remanded in custody by the Russian Criminal Court which transferred her to a prison outside St Petersburg. The final hearing of the father's application was adjourned from 16 May to 27 June. At the adjourned hearing the mother was not permitted by the Russian authorities to appear before the court by video link and her application to adjourn was refused on the basis of the 'pressing welfare needs of the children.'

DJ Gibson granted the father's application and set a date of 28 July 2018 for any appeal. On 25 July 2018 the mother sought permission to appeal and a stay of the order. The application for a stay was refused on 26 July 2018 and the application for permission to appeal listed on 2 October 2018, with any application for security for costs to be made by 9 August 2018 (none was made). The 26 July 2019 order was silent as to the costs.

On 5 September 2018, after pleading guilty to the charges in Russia, the mother was sentenced to four years imprisonment. The mother indicated an intention to appeal against sentence. The following then occurred:

(A) On 6 September 2019 the father wrote to the mother inviting her to withdraw her appeal and asking for confirmation that this was done by 11 September 2019. This letter put the mother on notice as to costs;

(B) A chasing letter was sent on 11 September 2018, no reply to the prior letter having been received;

(C) On 17 September the mother wrote to the father seeking an adjournment of the permission to appeal application until after the appeal against sentence in Russia;

(D) On 18 September 2018 the father's solicitors refused the request and said that they would be seeking the costs in full, on an indemnity basis, at the hearing on 2 October 'to include the costs of her application for an appeal and stay and his costs in the substantive children act proceedings';

(E) Later the same day, the mother agreed to withdraw her appeal on the basis of no order as to costs;

(F) On 19 September 2019 the father's solicitors wrote noting their disagreement with the 'no order as to costs' aspect of the mother's position. In a telephone conversation that followed the father's solicitor informed the mother's solicitor that their counsels' briefs would be 'deemed to have been delivered' at 9am the following morning; and

(G) The mother's solicitors then wrote to the father's solicitors stating that the appeal would be withdrawn and that there should be no order as to costs. It was asserted that 'it is simply absurd for further costs to be incurred by you instructing counsel to argue in respect of this issue.' The letter also flagged up that it may not be possible for instructions to be taken from the mother by 9am the following day. It was agreed that this letter was with father's solicitors before the deadline for delivery of briefs.

The Court of Appeal found that by the close of play on 19 September 2018 it was clear that the mother had said, in terms, that her appeal would be withdrawn and that such withdrawal was no longer subject to the father agreeing not to seek an order for costs. Notwithstanding this, on 24 September 2019, father's solicitors wrote saying that counsels' fees were now 'deemed' and that they would be seeking indemnity costs at the forthcoming hearing.

On 27 September 2018 the mother made a further concession, by agreeing to pay the father's costs on the standard basis to be assessed if not agreed. This was rejected. A further letter was sent contending that indemnity costs were inappropriate; that the costs schedule was excessive and disproportionate; and, noting an objection to costs sought for the hearing on 26 July where no order as to costs had been made.

On 2 October 2018 mother was represented by junior counsel, with a brief fee of £1,500 for the hearing, and the father by leading and junior counsel, with respective brief fees of £20,000 and £10,000.  After hearing submissions on the 'only issue' (indemnity costs vs standard costs), and whether an order for costs should be made in respect of the hearing on 26 July 2018, HHJ Meston QC decided that (a) the issue of costs in respect of the hearing on 26 July 2018 remained at large; and, (b) the indemnity basis was the proper basis of assessment on the facts of this case (paras 25 & 26). A summary assessment of costs was then conducted.

Appeal

The mother appealed on four grounds, as set out at paragraph 34. Thus:

(1) The judge was wrong to award the costs of the hearing on 26 July 2018 when the order was silent as to costs and the general rule is that no party is entitled to costs;

(2) That the judge was wrong in assessing costs on an indemnity basis;

(3) The judge was in error in conducting a summary assessment of costs without the necessary information in order to conduct such an assessment; and

(4) The judge was wrong in awarding the father the entirety of his costs and in doing so failed appropriately to weigh whether the costs were proportionate or reasonable.

Decision

Lady Justice King outlines the relevant rules and authorities within her judgment, including:

(A) FPR Part 28;

(B) So far as relevant, CPR Part 44.2(2);

(C) CPR 44.10;

(D) CPR 44.2(3), which provides that the general rule that costs will follow the event does not apply to an appeal to the Court of Appeal in family proceedings;

(E) Re S (A Child) (Costs: Care Proceedings) [2015] UKCS 20, which provides that only rarely will costs orders be made in children proceedings; and

(F)  Re T (Care Proceedings: Costs) [2012] UKSC 36.

The Court of Appeal dismissed ground (1), finding that the position is clear, namely:

(a) What CPR 44.10 is exactly what it says it is - a general rule.

(b) When the statutory instruments are traced through, it becomes apparent that following the amendment to the rule by statutory instrument on 25 March 2002 the rule ceased to be an absolute rule. Had the intention been to restore that position, the word "general" would have been removed when the exceptions were added in 2008.

(c) The principle that costs follow the event does not apply in family proceedings.

(d) The exclusion of CPR 44.10(2) therefore fits logically into the wholly discretionary approach to costs in family proceedings and reinforces the view that, in referring to a "general rule" in CPR 44(1)(i), the intention of the draftsman was to leave the court with a residual discretion.

(e) The judge had the jurisdiction to make an order for costs in respect of the 26 July hearing, and further that, contrary to the judge's view, jurisdiction was not dependent on the slip rule (or the so-called Tibbles jurisdiction).

Ground (2), which related to the basis of assessment, was dismissed. Three Rivers District Counsel v Bank of England [2006] 5 Costs Ltd 714 sets out the principles that should guide the court's determination as to whether to aware costs on an indemnity basis, and the conclusion that costs should be on the indemnity basis was plainly within the ambit of the judge's discretion.
 
Ground (3), the complaint that summary assessment should not have been conducted, was also dismissed on the basis that the judge was entitled in the exercise of his discretion to conduct such assessment. Lady Justice King referred to CPR 44.9(2)(b) and Lemmens v Brouwers [2018] EWCA 2963.

Ground (4), relating to principle and quantum of costs, was allowed in relation to quantum. The mother argued that the judge was wrong, notwithstanding his wide discretion, to make an order for costs in relation to the two brief hearings in a total sum of £109,394. The principle exception taken by the mother was counsels' fees.

Whilst noting that she had 'significant reservations' as to the level of fees for the 26 July 2018 hearing, Lady Justice King did not 'tinker' with that part of the order by seeking to reduce the total amount of the fees charged by counsel. However, finding that the 19 September 2018 letter was unequivocal in its terms, and having in mind that the costs do not need to be proportionate, but that the test is whether they are 'unreasonable', Lady Justice King found that counsels' fees for the 2 October hearing were, 'on any basis,' unreasonable in amount pursuant to CPR 44.4(1)(b)(ii).  Leading counsel's attendance at the low-level hearing, where there was no longer any threat to the welfare of the children, and marked at £25,000, was unreasonable, 'even absent a requirement for proportionality and notwithstanding the presumption in favour of the receiving party where indemnity costs are ordered (CPR 44.3(3)).

The global figure was reduced by £31,250 (ie: leading counsel's brief fee, and half of junior counsel's brief fee), thus substituting quantum of £109,394 for £78,144.

Case summary by Emily Ward, Barrister & Deputy Head of Family Law, Broadway House Chambers

Timokhina v Timokhin [2019] EWCA Civ 1284 on BAILII