Small claims track: no power to impose costs condition when granting permission to appeal - Reuters

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02-Jul-2021 - The Court of Appeal has held that, when determining an application for permission to appeal (PTA) against a judgment in a small claims track case, there was no power to impose a condition as to the costs of the appeal because CPR 27.14(2) expressly prohibits the court from ordering a party to pay another party's costs (including those relating to an appeal) in small claims track cases.

The decision confirms that, while the court has a general power to impose conditions which it would not normally make the subject of a direct court order, this power cannot be used where the condition is expressly prohibited by the CPR.

The appellant (B) sought to appeal the order of a District Judge requiring B to repay premiums under a payment protection insurance policy, plus interest, to the respondent (S). Following a refusal of PTA in the County Court, B applied for PTA a second time. Asplin LJ granted PTA, on the condition that B would pay S's reasonable costs of the appeal.

B applied to set aside the condition as to costs, contending that Asplin LJ had no jurisdiction to impose such a condition on an appeal in a case which was tried in the small claims track.

The Court of Appeal agreed. In a unanimous decision, delivered by Bean LJ, it held that:

If a condition was imposed on the grant of PTA, which the judge had no power to impose, this was a "compelling reason" to set aside the condition (under CPR 52.18(2)).

Following Akhtar v Boland [2014] EWCA Civ 943, the wording of CPR 27.14 extends to the costs of an appeal to the Court of Appeal.

There was a distinction between imposing a condition which the court would not ordinarily make the subject of a direct order, and imposing a condition which the court could never make the subject of a direct order because statute or a rule of court expressly prohibits it. Where a rule expressly prohibits orders for costs, the court could not use its general power to attach conditions to sidestep the rule (Canada Square Operations Ltd v Potter [2021] EWCA Civ 339).

It was far too late to re-allocate the case to the fast track or multi-track.

Case: Smith v Royal Bank of Scotland Plc [2021] EWCA Civ 977 (30 June 2021) (Bean, Lewis and Elisabeth Laing LJJ).

Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias. Practical Law is owned by Thomson Reuters.

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Small claims track: no power to impose costs condition when granting permission to appeal - Reuters
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