BL-2022-MAN-000036 - [2025] EWHC 2084 (Ch)

This judgment considers the parties’ liability for the costs arising in relation to an interim application and two full days’ hearings made in the course of a professional negligence claim by purchasers who are suing their former conveyancing solicitors in relation to a failed residential development scheme. Who should bear the costs of the solicitors’ application to strike out the claim, or for summary judgment against the claimants, where that application fails only because the court permits the claimants to make an informal application to amend their statement of case? And who should bear the costs of the claimants’ informal, and opposed, amendment application where most, but not all, of the amendments are permitted? The answers to these questions involves identifying the successful party to the application.

This written judgment is a sequel to, and should be read in conjunction with, the reserved judgments I handed down in this case on 17 April 2024 (bearing the neutral citation number [2024] EWHC 801 (Ch)) and 17 January 2025 (bearing the neutral citation number [2025] EWHC 14 (Ch)). The first of those judgments was delivered on the application of the 10^th defendant (‘Vincents’) to strike out a claim in professional negligence brought against it by (then) 35 separate claimants (numbered 60 to 94) arising out of their purchase of 50 residential units in a buyer-funded, off-plan development scheme in Liverpool 6, or for summary judgment against the claimants under CPR 24. As I explained in my first judgment, each of the purchasers lost substantial, up-front payments on the failure of the development; and they are now suing Vincents, who acted as their conveyancing solicitors, for breach of duty.

The issues raised by Vincents’ application included the nature and extent of the duties they owed to purchasers to advise them of the risks of investing in this particular development; whether Vincents were in breach of such duties; the nature of the risks against which the law imposes a duty of care on Vincents (the scope of duty issue); whether the loss for which the claimants are seeking to recover damages is the consequence of Vincents’ acts or omissions (the factual causation issue); whether there is a sufficient nexus between a particular element of the harm for which the claimants seek to recover damages and the subject-matter of Vincents’ duty of care (the duty-nexus issue); and whether the claims against Vincents were sufficiently pleaded.

At the earlier hearing, on 20 March 2024, Vincents were represented by Mr Simon Wilton KC, instructed by RPC. The (then) 35 purchasers who had instructed Vincents on their respective purchases were represented by Mr Laurie Scher (of counsel), instructed by Walker Morris LLP. The same counsel and solicitors have continued to act in the case. Save where the context otherwise requires, in this judgment I shall refer to Mr Scher’s lay clients as ‘the claimants’. I record that after my first judgment, the 79^th, 91^st, 93^rd and 94^th claimants (who purchased a total of 13 units between them) settled their claims against Vincents. I shall refer to the 31 surviving claimants as ‘the remaining claimants’.

The background to Vincents’ application is set out in my first judgment; and it is unnecessary for me to repeat it here. For the reasons set out in that judgment, I concluded that I should not finally determine Vincents’ application on the materials that were before the court on the first hearing. Rather, I should afford the claimants an opportunity to amend their original statement of case. In summary, my order provided for:

A timetable was set out for each of these various steps, which was subsequently extended by agreement between the parties. Due in large part to difficulties in arranging a hearing date to suit the mutual convenience of both counsel and the court, the application only returned to this court on Thursday 5 December 2024. That delay was of some significance because it meant that more than six years had by then elapsed since all the remaining claimants had exchanged contracts for the purchase of their respective units in the development, giving rise to potential limitation issues. With the benefit of my pre-reading, the hearing was again comfortably completed within its time estimate of one day. As on the previous occasion, I found it necessary to reserve my judgment at the conclusion of the hearing. I subsequently handed that judgment down on Friday, 17 January 2025.

Mr Scher had invited the court to approve all of his proposed amendments, and to dismiss Vincents’ application to strike out the claim against the remaining claimants, or for summary judgment on that claim. He submitted that the amended claims have (at the very least) a real prospect of success, based upon a sufficiently particularised statement of case. Allowing the amendments was necessary in order to do justice between the parties.

Mr Wilton had submitted that the proposed amendments included ‘new claims’, which were time-barred, and which did not arise out of the same, or substantially the same, facts as were already in issue in this claim. He had submitted that the court did not have the necessary jurisdiction to allow any of the amendments; and that the remaining claimants’ remedy, should they wish to pursue any such claims, notwithstanding the limitation obstacle, was to issue new proceedings.If, contrary to Mr Wilton’s primary position, the court did have the necessary jurisdiction to allow all, or any, of the amendments, he had submitted that there were numerous reasons why this court should refuse permission to amend, as a matter of the court’s discretion, and summarily dismiss the claim against Vincents.

For the reasons set out in my second judgment, I found that there was no jurisdictional bar that would prevent the court allowing any of the remaining claimants’ proposed amendments. I rejected Mr Wilton’s submissions that Vincents could rely upon the remaining claimants’ delay in bringing forward any new case, and any consequent case management implications, as valid, and sufficient, reasons for refusing to allow the amendments sought. For the reasons given in my second judgment, and as a matter of the exercise of the court’s discretion, I refused the remaining claimants permission to amend their particulars of claim to introduce the new claim that Vincents had given erroneous advice to some of the remaining claimants by email or by telephone. I therefore disallowed the amendments sought to be introduced by paragraph 29A of the draft amended particulars of claim and Appendix 2, and also the additions to the opening of paragraph 45 and to paragraph 45.6. I also refused the remaining claimants permission to amend their particulars of claim to introduce the scope of duty and duty-nexus argument that was pleaded in paragraph 46A.1 of the amended particulars of claim. However, I allowed all of the remaining claimants’ other proposed amendments. I directed that they should prepare, file, and serve amended particulars of claim in accordance with my second judgment, with Vincents to file and serve an amended defence consequential upon those amended particulars of claim. The parties proceeded to agree a timetable for these amendments, and then to bring the matter back before the court for a case management hearing. This hearing extended also to the extant claims against the 2^nd defendant. In the event, the matter came back before me for a full day’s costs and case management hearing (CCMH) in Manchester, attended by counsel for the remaining claimants (Mr Scher), the 2^nd defendant (Mr Paul Parker), and the 10^th defendant (Mr Wilton KC) on Wednesday 30 July 2025.

At paragraph 115 of my second judgment, I had invited the parties to seek to agree a substantive order to give effect to my second judgment. This was to include provision for the costs of Vincents’ application (including the reserved costs of the first hearing). I recorded that my then, and entirely provisional, view was that some, but not all, of these costs should fall to be borne by the remaining claimants because they had only avoided the striking out of their claims against Vincents, and had resisted summary judgment on such claims in Vincents’ favour, because of the amendments to their particulars of claim for which I had given permission. I directed that if the parties could not agree upon a suitable form of order, they should provide a draft composite order, together with brief written submissions on the outstanding consequential matters. Unless I directed otherwise, I would proceed to determine the outstanding matters on the papers.

Counsel’s respective costs submissions were submitted to the court by CE-Filing on Friday, 31 January 2025. Unfortunately, due to shortages of, and pressures of work on, the court staff, these submissions were not processed and filed (as case Events 226 and 228) until some five weeks later, on Sunday 9 March 2025. Even more unfortunately, these submissions were not referred to me, by way of CE-File Alert or email (as they should have been), either then, or at any time thereafter. It was only shortly before 1.00 pm on Sunday, 26 July 2025 that I first discovered the existence of these written submissions. This came about when, as part of my preparations for the full day’s CCMH that was listed before me on Wednesday, 30 July, I noticed in unprocessed filings, and downloaded from CE-File, a letter addressed to me from the 10^th defendant’s solicitors (RPC) dated 24 July 2025, “reminding” me that “costs issues remain outstanding”. This letter was not itself processed by the court staff until Tuesday 29 July (as Case Event 273). Even then, it was not formally referred to me, either by way of CE-File or email, as it should have been. This letter included the following paragraph: