The High Court case of Cleary v Marston (Holdings) Ltd

The High Court case of Cleary v Marston (Holdings) Ltd [2021] EWHC 3809 (QB) might look on its face to be rather far removed from housing litigation, but the case, in which Mr Justice Nicklin presided, could prove very useful to a landlord who has been on the wrong end of a large costs bill despite the claimant only having limited success at trial.

Facts

The claim was based on a data breach. An email had been sent by an employee of the defendant to an incorrect person, this was done by accident. The facts of the dispute were mostly agreed, the only disputed element was whether the accidental recipient had read the email.

The claim was issued in the High Court and the matter was funded by way of a CFA. The claimant also had the benefit of an ATE policy. The pleaded claim was for £3000, however, the claimant’s costs budget was for £46,908.

Following issue, the Judge ordered a case management conference for the Claimant to justify why the matter had been issued in the High Court. At this case management conference, the Judge was seemingly unsatisfied with the answer and ordered the matter be transferred to the County Court and indeed the small claims track.

Key elements of the judgement

Of particular relevance to housing litigation, in this judgment, is a quote from paragraph 37, which states “no ordinary litigant would incur costs approaching £50,000 in order to recover £3,000. The likely irrecoverable costs would almost certainly exceed the sum that Mr Cleary was claiming in damages”. It does not take much imagination to see how this might apply to housing disrepair claims.

Typically, as many landlords can attest, a tenant who has been “successful” at trial, may have incurred significant costs while only obtaining minimal damages (or indeed still end up owing money to the landlord for rent arrears) and potentially an order for specific performance. It seems that this case is a good reminder that litigation needs to be carried out in a proportionate manner. In recovering small sums of money, a claimant should not be incurring disproportionate costs.

A further relevant quote can be found in paragraph 28, which states “It is important that claimants (and those advising them) do not pursue claims that add little but yet have the potential to make the case more complicated and lead to increased costs ultimately to resolve what in many cases will be a straightforward claim”.

It is not uncommon in housing disrepair claims for numerous allegations to be made in the particulars of claim. The bulk of which are either dropped or simply go unproven at trial. From this quote, it seems as though claimants, and crucially those who advise them, should not go out of their way to complicate claims by making dubious allegations.

The Birketts view

This case can really be boiled down to proportionally. It is a concept that is meant to underpin litigation. It would appear that next time a disproportionate costs bill comes in following a minor “success” at trial, it would be useful to raise with the other side; how can it be said that an ordinary litigant would incur such cost, for such reward.

How Birketts Can Help?

Birketts has a specialist team of Housing Management lawyers to assist our clients stay ahead. Our expert lawyers can advise on all aspects of housing and asset management from complex ASB claims, Equality Act defences, Building Safety issues, defending disrepair claims/EPA prosecutions, subletting/housing fraud cases, service charge disputes, s.20 consultation issues, applications to vary defective leases, to name but a few of the issues we can assist with. Our experts have decades of experience acting for Registered Providers and Local Authorities and offer a truly ‘one stop shop’ for the issues facing the sector.