over chattels
There is an ingrained judicial dislike of litigation that costs more than the value of its subject matter. A sense of proportion in such matters is now embedded into the United Kingdom legal system as part of the overriding principle that courts must do justice between the parties. A successful claimant might therefore fail to recover costs from the losing party where the matter at hand could reasonably and more economically have been referred to alternative dispute resolution.
A typical expression of this view can be found in the judgment of Ward L. J. in Tavou-lareas v Lau23:
“This litigation fills me with despair. […] The first extraordinary aspect of this bitterly-fought litigation is that the claimant has spent some £60,000 on it to date, the defendants
£25,000; £85,000 in all, over a claim worth at most £23,500. Now, litigation must be fun if the parties are prepared to spend that much on a rollercoaster ride to judgment without pausing, either of them, to suggest that mediation would be a more sensible way to re-solve their differences. I am sorry to say that the second extraordinary feature of the case is the perfunctory judgment under appeal. […] This is extraordinary litigation and it will be even more extraordinary if it continues any longer than this court. What is now in issue is a question of damage to the paintings that have been recovered, allegedly be-cause they have been splattered with white paint or possibly damaged. Although Mr Marland boldly submitted that that claim might be measured in an amount up to
£1,000, I would have thought he is optimistic and, indeed, at one point he seemed in-clined to accept that that part of the claim would be abandoned. I do not hold him to the concession, but I remind him of it and observe that it makes eminently good sense to me.
[…] What the remainder of the claim is worth I do not know, but since it is perfectly obvious that paintings are in the possession or were in the possession of the defendants' solicitors, I would have thought that there are very easy ways through mediation and a bit of common sense to resolve this matter and hopefully to resolve it quickly and without a further extraordinary waste of money.”
Similar attitudes can be glimpsed in cases involving claims to more everyday chattels, such as cars. An example is Mainline Private Hire Ltd v Nolan24:
“I add this post-script. This case has been fought tooth and nail and in the end the only claim to succeed is about a broken down car which […] has not turned a wheel in nearly five years. It may be that there is a substantial claim for damages still to be adjudicated upon. Had matters been otherwise, this court would under its present practice have refused permission to appeal. […] However, it is difficult to believe that after about four days before the judge and another in this court there is much left to gain in this for either party. Moreover, litigation of this kind is not a proportionate use of an expensive and scarce public resource. I am not suggesting that either party should bear all the blame but I am asking them, and their advisers, to make every effort to find a way of reaching some agreement about this outstanding claim before engaging them in further litigation.
23 [2007] EWCA Civ 474.
24 [2011] EWCA Civ 189, para. 43; noted by PALMER NORMAN, Identifying the Parties to an Art Transaction: Mainline Private Hire Ltd v Nolan, Art Antiquity and Law, Vol. 16, 2011, p. 161.
available, or they may wish for whatever reason to promote the current law and put the past behind them. Unwelcome probing on this point can lead to emotional challenges about whose side the adviser is really on.
B. Volatility of legal decisions
The co-existence within England and Wales of an incremental system of common law decision-making, a hierarchical system of precedent and a well-balanced system of ap-peals can mean that the common law hovers in a state of uncertainty for an unacceptably long period. This can of course affect third parties who are awaiting a ruling on the points under litigation as well as the parties themselves. In Iran v Barakat, for example, the first instance hearing in March 2006 was followed by a judgment of the Queen’s Bench judge in March 2007; the appeal hearing was held in October 2007 and the Court of Appeal delivered its judgment in December 2007. The matter did not come to rest judicially until the House of Lords refused permission to appeal in mid-2008. The Court of Appeal’s decision was in any event only a ruling on preliminary points and the claim itself did not finally settle until late 2011. The author is aware of at least one other set of parties that were awaiting a final result in Iran v Barakat in order to guide their own management of a claim. Although the time consumed by this litigation hardly rivalled that consumed by the litigation in the Dickens novel ”Bleak House”, the chronology of Iran v Barakat does little to entice future adversaries into litigation.
Similar difficulties can arise from legislative change. Claims to cultural property often turn on events from long ago. As we have seen, this may require reference to laws that have since been repealed, the texts and translations of which may be hard to obtain. The exercise in legislative necromancy may prove frustrating and can easily inflate the costs.
C. Proportionality and the overriding objective: judicial despair at excessive, prodigal and self-indulgent litigation over chattels
There is an ingrained judicial dislike of litigation that costs more than the value of its subject matter. A sense of proportion in such matters is now embedded into the United Kingdom legal system as part of the overriding principle that courts must do justice between the parties. A successful claimant might therefore fail to recover costs from the losing party where the matter at hand could reasonably and more economically have been referred to alternative dispute resolution.
A typical expression of this view can be found in the judgment of Ward L. J. in Tavou-lareas v Lau23:
“This litigation fills me with despair. […] The first extraordinary aspect of this bitterly-fought litigation is that the claimant has spent some £60,000 on it to date, the defendants
£25,000; £85,000 in all, over a claim worth at most £23,500. Now, litigation must be fun if the parties are prepared to spend that much on a rollercoaster ride to judgment without pausing, either of them, to suggest that mediation would be a more sensible way to re-solve their differences. I am sorry to say that the second extraordinary feature of the case is the perfunctory judgment under appeal. […] This is extraordinary litigation and it will be even more extraordinary if it continues any longer than this court. What is now in issue is a question of damage to the paintings that have been recovered, allegedly be-cause they have been splattered with white paint or possibly damaged. Although Mr Marland boldly submitted that that claim might be measured in an amount up to
£1,000, I would have thought he is optimistic and, indeed, at one point he seemed in-clined to accept that that part of the claim would be abandoned. I do not hold him to the concession, but I remind him of it and observe that it makes eminently good sense to me.
[…] What the remainder of the claim is worth I do not know, but since it is perfectly obvious that paintings are in the possession or were in the possession of the defendants' solicitors, I would have thought that there are very easy ways through mediation and a bit of common sense to resolve this matter and hopefully to resolve it quickly and without a further extraordinary waste of money.”
Similar attitudes can be glimpsed in cases involving claims to more everyday chattels, such as cars. An example is Mainline Private Hire Ltd v Nolan24:
“I add this post-script. This case has been fought tooth and nail and in the end the only claim to succeed is about a broken down car which […] has not turned a wheel in nearly five years. It may be that there is a substantial claim for damages still to be adjudicated upon. Had matters been otherwise, this court would under its present practice have refused permission to appeal. […] However, it is difficult to believe that after about four days before the judge and another in this court there is much left to gain in this for either party. Moreover, litigation of this kind is not a proportionate use of an expensive and scarce public resource. I am not suggesting that either party should bear all the blame but I am asking them, and their advisers, to make every effort to find a way of reaching some agreement about this outstanding claim before engaging them in further litigation.
23 [2007] EWCA Civ 474.
24 [2011] EWCA Civ 189, para. 43; noted by PALMER NORMAN, Identifying the Parties to an Art Transaction: Mainline Private Hire Ltd v Nolan, Art Antiquity and Law, Vol. 16, 2011, p. 161.
I have no doubt that the courts which are concerned with the trial on damages will wish also to know that that has been done.”25
Domestic building disputes are a further example of a field in which the judges are quick to assert the virtues of mediation. In Vernon v Spoudeas and Another26 Ward LJ de-scribed the case as one “which fills me with gloom and despondency”. Costs in the re-gion of £75,000 had already been expended over a five-year period in fighting two claims totalling some £25,000 and a counterclaim for just over £12,000. The learned Lord Justice said:
“One would have thought that this was quintessentially the case which cried out for compromise through mediation, rather than confrontation through litigation. It was always inevitable that the cost would exceed the sums truly in dispute and so it has proved”27.
One could multiply such expressions of disbelief and dismay. Another case involving domestic construction work is Burchell v Bullard28, where Ward LJ said:
“As we had expected, an horrific picture emerges. In this comparatively small case where ultimately only about £5,000 will pass from defendants to claimant, the claimant will have spent about £65,000 up to the end of the trial and he will also have to pay the subcontractor's costs of £27,500. We were told that the claimant might recover perhaps
25 Disputes over cars have a tendency to attract somewhat “over the top” responses from aggrieved parties. An early example is Ashby v Tolhurst [1937] 2 KB 242, where the owner of a car stolen from a car park at Southend-on-Sea succeeded at first instance in recovering slightly over £30 for the value of the car, but lost the case on appeal: a costly experience for so inexpensive a chattel. A later case, Woodard v Woodard [1995] 3 All ER 980, involved the alleged gift from father to son of an Austin Metro car, seldom a prized asset in discerning circles. Similarly to the dispute in Neave v Neave, a mother was suing her son over the title to a car that had once belonged to the husband and father.
DILLON L.J.described the appeal as “about the most sterile appeal I have ever come across” and con-tinued: “The amounts at issue are not very large. Both parties had legal aid in the court below. Both parties have legal aid in this court. Both parties are living entirely on state benefits. The defendant became unemployed six months ago and has also had to undergo heart surgery. There appears to be no prospect of his being able to meet any judgment that the plaintiff might achieve by this appeal, and any sum for which judgment was recovered would be subject to the legal aid board’s charge for the plaintiff’s costs in the court below and in this court. None the less, we have to deal with the issues […]”. For a case where a claimant car-owner was held to have properly attached a value to the car that exceeded the purely commercial value cf. O’Grady v Westminster Scaffolding Ltd [1962] 2 Lloyd’s Rep 238.
26 [2010] EWCA Civ 666.
27 At para. 3.
28 [2005] EWCA Civ 358, para. 23.
only 25% of his trial costs, say £16,000, because most of the contest centred on the coun-terclaim. The defendants' costs of trial are estimated at about £70,000 and it was esti-mated the claimant would have to pay about 85%, i.e. £59,5000. Recovery of £5,000 will have cost him about £136,000. On the other hand the defendants who lost in the sense that they have to pay the claimant £5,000 are only a further £26,500 out of pocket in respect of costs. Then there are the costs of the appeal – £13,500 for the appellant and over £9,000 for the respondents. A judgment of £5000 will have been procured at a cost to the parties of about £185,000. Is that not horrific?”
Finally, in Shovelar v Lane29, Ward L. J. said:
“If the claimants are right in their assessment of their costs, then, even without a success fee, the costs incurred by them exceed the sum over which battle has been joined. The great British public must think that something has gone wrong somewhere if litigation is conducted in that way. I share that sense of horror. One answer has to be to engage in mediation constructively and at the very earliest stage.”30
29 [2011] EWCA Civ 802, para. 61.
30 See further Rolf v De Guerin [2011] EWCA Civ 78 at para. 1 per Rix LJ: “This is an appeal solely about costs. It is also a sad case about lost opportunities for mediation. It demonstrates, in a particular class of dispute, how wasteful and destructive litigation can be.” The excessive incurring of costs was recently lambasted by HENDERSON J. in D R Sheridan LLP v Higgins and Woods [2012] EWHC 547 (Ch) at para. 38: “A further disturbing feature of the case is that D R Sheridan's statement of costs for the proceedings amounts to no less than £35,882.09 plus VAT, including fees to counsel (Mr Studer) of approximately £16,100 for advice on some 17 occasions from 18 October 2010 onwards, as well as fees for settling the claim form, his skeleton argument and brief fee. As I said in the course of the hearing, I find it shocking that fees of this order of magnitude should have been incurred by a solici-tor in dealing with an essentially straightforward dispute that should have been capable of rapid reso-lution.” And see further Zarb v Parry [2011] EWCA Civ 1306 at para. 58 to 59 per Arden LJ, who suggests that procedures other than those relating to dispute resolution can in appropriate cases head off extravagant disputes: “These proceedings have been costly and there is a cautionary story here for purchasers of land. No doubt those advising on transfers of land will consider what they need to do in future to protect their clients from costly disputes such as this one. Purchasers are not necessarily pro-tected merely because the seller gives an assurance that the dispute with a neighbour has seemingly
“gone away”. Boundary disputes have a habit of reappearing until finally resolved. The neighbour or the neighbour’s successor in title may, for whatever reason, resuscitate the dispute, unless something is done to prevent them from doing so. It may be that the purchaser will have to consider whether to ask the neighbour to confirm the boundaries and have the necessary deed of confirmation registered at the Land Registry in a manner capable of binding successors in title. That will involve extra costs and delay but the costs may be less than the undoubted cost of litigation of this kind. If the neighbour refuses to be bound by an agreement as to the boundary the purchaser will then know the risks that he
I have no doubt that the courts which are concerned with the trial on damages will wish also to know that that has been done.”25
Domestic building disputes are a further example of a field in which the judges are quick to assert the virtues of mediation. In Vernon v Spoudeas and Another26 Ward LJ de-scribed the case as one “which fills me with gloom and despondency”. Costs in the re-gion of £75,000 had already been expended over a five-year period in fighting two claims totalling some £25,000 and a counterclaim for just over £12,000. The learned Lord Justice said:
“One would have thought that this was quintessentially the case which cried out for compromise through mediation, rather than confrontation through litigation. It was always inevitable that the cost would exceed the sums truly in dispute and so it has proved”27.
One could multiply such expressions of disbelief and dismay. Another case involving domestic construction work is Burchell v Bullard28, where Ward LJ said:
“As we had expected, an horrific picture emerges. In this comparatively small case where ultimately only about £5,000 will pass from defendants to claimant, the claimant will have spent about £65,000 up to the end of the trial and he will also have to pay the subcontractor's costs of £27,500. We were told that the claimant might recover perhaps
25 Disputes over cars have a tendency to attract somewhat “over the top” responses from aggrieved parties. An early example is Ashby v Tolhurst [1937] 2 KB 242, where the owner of a car stolen from a car park at Southend-on-Sea succeeded at first instance in recovering slightly over £30 for the value of the car, but lost the case on appeal: a costly experience for so inexpensive a chattel. A later case, Woodard v Woodard [1995] 3 All ER 980, involved the alleged gift from father to son of an Austin Metro car, seldom a prized asset in discerning circles. Similarly to the dispute in Neave v Neave, a mother was suing her son over the title to a car that had once belonged to the husband and father.
DILLON L.J.described the appeal as “about the most sterile appeal I have ever come across” and con-tinued: “The amounts at issue are not very large. Both parties had legal aid in the court below. Both parties have legal aid in this court. Both parties are living entirely on state benefits. The defendant became unemployed six months ago and has also had to undergo heart surgery. There appears to be no prospect of his being able to meet any judgment that the plaintiff might achieve by this appeal, and any sum for which judgment was recovered would be subject to the legal aid board’s charge for the plaintiff’s costs in the court below and in this court. None the less, we have to deal with the issues […]”. For a case where a claimant car-owner was held to have properly attached a value to the car that exceeded the purely commercial value cf. O’Grady v Westminster Scaffolding Ltd [1962] 2 Lloyd’s Rep 238.
26 [2010] EWCA Civ 666.
27 At para. 3.
28 [2005] EWCA Civ 358, para. 23.
only 25% of his trial costs, say £16,000, because most of the contest centred on the coun-terclaim. The defendants' costs of trial are estimated at about £70,000 and it was
only 25% of his trial costs, say £16,000, because most of the contest centred on the coun-terclaim. The defendants' costs of trial are estimated at about £70,000 and it was