A High Court judge has refused two housebuilders permission to amend an agreed costs budget in a legal negligence claim after a bid to almost double the sums allowed.
Sitting in Persimmon Homes Ltd & Anor v Osborne Clark LLP (sic), Master Kaye made clear that not every development in litigation warranted a revision of the last approved costs budget, even if that decision had costs consequences. Instead the court had to consider whether there had been both a significant development and that it required the budget to be revised.
Dismissing an application from Persimmon Homes and Taylor Wimpey Homes UK to vary the existing budget in a £10m professional negligence claim against international firm Osborne Clarke, the master said it would be ‘inconsistent with the overriding objective to manage cases justly and efficiently’ to give any discretion.
He added: ‘Cost budgeting is about setting prospective costs and CPR3.15A is to enable the court to approach the question of variations and amendments in a practical and purposive way not to oust the role of the costs judge.’
In 2019, Deputy Master Linwood had approved the developers’ costs budget of £1.455m, of which just over £1m was future costs. On appeal, Master Kaye said Linwood would have considered what was a reasonable and proportionate sum following a two-part costs management conference.
In an application issued the following year, the developers sought to increase their budget to £2.8m, including more than doubling future costs to £2.368m. They argued that at the time of the first budget being sealed, it had not been anticipated that Osborne Clarke would have made a request for disclosure. Subsequent further CMCs were said by the developers to be a ‘significant development’ which merited a revised costs schedule.
The court heard that even before the first budget was set the developers and Osborne Clark had been unable to agree the approach to disclosure. The developers said their costs budget as agreed by the deputy master was based on different disclosure assumptions to the firm.
The firm told the court that a change in disclosure model should have been raised with the deputy master at the time. Master Kaye ruled that the development should have been expected.