Is a payment on account of costs enforceable?

3 May 2024

Possibly for the first time that this point has been considered by the courts, it was recently held by the High Court in Patel and Others v Awan and Another [2024] EWHC 464 (Ch) that a payment on account of costs under Rule 44.2(8) of the Civil Procedural Rules (CPR) is enforceable like any other money judgment or an order under CPR 70.2 (methods of enforcing judgments or orders).

What are the facts of Patel v Awan?

On its facts, Patel v Awan came before the High Court for a determination of the Claimants' Part 8 claim for an order of sale in respect of a residential property resided in by both Defendants and registered in the name of the First Defendant. The charging order on which the claim relies was obtained to secure an unpaid order for an interim payment of £118,800, payable by a specified date, included in an earlier court order in the context of underlying proceedings between the parties.

Although the Defendants had not yet paid any part of the payment on account, they resisted the order for sale on the basis that this payment had not yet fallen due. The Defendants' primary position was that the order for an interim payment cannot be enforced by way of a charging order and so the claim could not succeed. If they were wrong about that, they instead invited the court not to make an order for sale relying on various discretionary factors by way of alternative.

What were the findings in Patel v Awan?

It was held that an order for payment on account of costs made under CPR 44.2(8) is an enforceable order, notwithstanding the reference to "on account" and regardless of whether detailed assessment proceedings have concluded. If the payment ordered remained unpaid after the due date, it was enforceable in the same way as any other money judgment or order under CPR 70.2.

In particular, reference was made by Master Kaye to CPR 70.1(2) (d) which provides that a judgment or order for the payment of money includes a judgment or order for the payment of costs. CPR 70.2 then makes specific provision for methods of enforcing judgments or orders for the payment of money, as specifically set out in Practice Direction 70A, where judgment creditors may (except where an enactment, rule or practice direction provides otherwise) use any method of enforcement which is available. The CPR therefore assumes that an order for payment of a sum of money by way of costs is enforceable by various methods, including charging orders.

Previous caselaw showed a distinction between unassessed costs or an unascertained sum, which represent a contingent liability, and those which have already been determined. The master thus concluded that a payment on account of costs was not a contingent liability dependent on the outcome of any detailed assessment, but was rather a final judicial determination payable by a due date. The order had identified both a sum to be paid and the date by which it should be paid.

In dismissing the discretionary factors advanced on behalf of the defendants, this ruling meant that the claimants were entitled to seek an order for sale against the first defendant's property to enforce a charging order securing the sum payable under an order for payment on account of costs.

Legal disclaimer

The matters contained within this article are intended to be for general information purposes only. This blog does not constitute legal advice, nor is it a complete or authoritative statement of the law in England and Wales and should not be treated as such.

Whilst every effort is made to ensure that the information is correct, no warranty, either express or implied, is given as to its’ accuracy, and no liability is accepted for any errors or omissions.

Before acting on any of the information contained herein, expert advice should always be sought.

The Dispute Adviser

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