Alec McCluskey, instructed by Sobashni De Silva and Kulwant Sokhal of JMW Solicitors LLP, acted for the claimant in successfully resisting an application for relief from sanctions.

The defendants (a law firm and the senior partner of the firm) had filed their costs budget out of time. They therefore needed relief from sanctions under r.3.14 (the sanction being that they were treated as having filed a budget comprising only the applicable court fees).

This gave rise to an interesting point of law. The court concluded that the defendants’ budget, as well as being filed out of time, contained figures that had been deliberately inflated to match those in the claimant’s budget. The court had to consider the consequences of this.

The court held that where a budget had been obviously prepared without real compliance with the obligation to complete Precedent H fairly and accurately it would be ‘illusory’ (applying to the field of costs budgeting by analogy earlier caselaw decided in relation to disclosure statements), in that the budget could not properly be signed with a statement of truth. That compromised the integrity of the justice system, and the sanction of treating the defendants as having filed a budget comprising only the applicable court fees was proportionate to the breach.

The case is a warning of the seriousness with which the courts regard statements of truth on costs budgets. The judgment can be found here.