Background
Mr. Carl brought proceedings claiming he had paid funds to acquire historic sports cars through intermediaries, including defendant Mr. Richard Edwards (a car dealer), but the vehicles were never delivered. Edwards’ modus operandi involved taking money for car purchases while diverting funds into his own transactions. In October 2015, after Carl obtained a delivery-up order for eight vehicles Edwards had claimed to hold in storage with a company called SCM, Edwards and others removed the cars in an event the trial judge termed “the raid.” Edwards later claimed he had transferred the cars to Mr. Limbani, who worked as a chauffeur for Trevor Smith.
Carl initially sued Edwards, Hawkins, and SCM. The proceedings were stayed in 2016 while Carl pursued parallel US litigation naming Limbani as a defendant. After the US case was dismissed on jurisdictional grounds in 2018, Carl returned to the English courts and joined Limbani as a defendant in May 2018. Limbani’s defence claimed he was merely a chauffeur who occasionally drove Edwards as a passenger and provided a car dealer’s contact information—nothing more.
The trial took place in May 2024 before Simon Gleeson, sitting as a Deputy Judge of the High Court. The trial was procedurally troubled: Mr. Carl appeared in person, there was no agreed trial bundle, and the judge described the documentary assembly as “a shambolic mess.” Nonetheless, Gleeson issued a detailed judgment dismissing Carl’s claims against Limbani on liability, though making serious findings about Limbani’s credibility and conduct.
The Court’s Holding
The Court of Appeal found that the trial judge committed a serious procedural error regarding costs. Although the trial judge had dismissed Carl’s substantive claim against Limbani, he made a preliminary finding that there should be “no order for costs” as between Carl and Limbani. The judge explicitly framed this as a provisional view, stated he was “prepared to hear further submissions,” and indicated a consequentials hearing would be held to determine final costs. The judge’s stated reason was that Limbani had “escaped examination of his conduct through a policy of evasion and non-disclosure” and failed to provide ordered disclosure despite testifying under oath that he had nothing to disclose.
At the consequentials hearing five months later, Limbani’s counsel attempted to make submissions on costs, but the judge refused to hear them, stating the matter was already finally determined and could only be appealed to the Court of Appeal. The appellate court held this refusal violated natural justice. Because the judge had expressly invited further submissions on a preliminary view, the refusal to hear those submissions at the scheduled hearing constituted a serious procedural irregularity. The court set aside the costs order and remitted the issue for reconsideration by the trial judge.
Key Takeaways
- When a trial judge explicitly labels cost rulings as “preliminary views” and invites further submissions, refusing to hear those submissions at the designated hearing is a serious procedural error.
- Poor case management by a defendant’s legal team—such as failing to serve skeleton arguments or signaling issues in advance—does not excuse a judge’s procedural error in refusing to hear submissions already promised.
- The established procedure for exercising the costs discretion ordinarily requires an opportunity to be heard; departing from this without permitting submissions breaches established law and natural justice.
- A five-month delay between judgment and the consequentials hearing does not convert a preliminary costs view into a final determination if the judge has not explicitly said so.
Why It Matters
This decision clarifies important procedural protections in costs disputes. Judges regularly make preliminary cost rulings when substantive judgments are handed down, especially in complex multi-party litigation. This case establishes that such rulings carry weight only if properly finalized: expressly labeling a view as preliminary and promising further opportunity to be heard creates a duty to actually hear those submissions. The court’s willingness to set aside a costs order on procedural grounds alone—without addressing the merits of whether Limbani’s non-disclosure justified denying costs—underscores the importance of adhering to natural justice principles, even in procedurally chaotic cases.
The judgment also reflects the challenges faced by trial judges when parties are unrepresented or under-represented. Gleeson had commended his own fairness in considering legal arguments unrepresented parties might have raised. Yet the appellate court found that fairness must also extend to ensuring that litigants who are represented have a meaningful opportunity to address cost consequences of their conduct, even if that opportunity comes at a consequentials hearing rather than during the main judgment.