PI Brief Update

Costs budgeting can be retrospective: BDW Trading Limited v Ardmore Construction Limited [2025] EWHC 1063 (TCC) - Andrew Ratomski, Temple Garden Chambers

21/05/25. Date of judgment: 2 May 2025

Andrew Mitchell KC sitting as a Deputy Judge of the High Court was required to decide whether the court had the power to make a costs management order retrospectively and to consider the reasonableness of budgets filed almost a year prior at a Costs and Case Management Conference (“CCMC”) held in June 2024.

Procedural history

A number of issues were determined at the first CCMC but it appears that remaining disagreement as to costs issues was not brought to the attention of the judge at that hearing and neither were costs budgets provided. As a result a costs management order was not made at that stage.

Subsequent to the CCMC the Claimant applied to amend its June 2024 budget and this application in almost mid 2025 brought to light unresolved costs budgeting issues.

The issues

The matter was referred to the costs judge and he directed that the parties provide him with the relevant documents, including those that should have been before him at the original CCMC. The judge proceeded to resolve the disputed items in the budgets as filed in June 2024 and would put the parties in a position where those were considered in their proper context. It was also essential to establish the June 2024 position in order to assess the increase now sought by the Claimant as it was a very substantial revision upwards of the position previously filed with the court.

The Claimant argued that the court had alternatively no power to or otherwise should not make a costs management order in respect of an earlier date as that would be “retrospective”, it sought an order for its increased budget as it was now. Alternatively it applied to vary its budget under rule 3.15A of the CPR on account of “significant developments” since the original CMC.

The decision

The judge rejected the Claimant’s argument and held the court was able to set out its view as to the reasonableness of the budgets as at June 2024. The judge referred to the provisions under rule 3.15(2) that a costs management order can be made at any time and the general discretion of the court as to what to approve. The judge held the court was recording its views as to estimates when submitted on a particular date and this approach was said to be the “disciplined” one even where revisions were made.

The judge therefore made the order based on the materials available in June 2024 before considering the application to vary the Claimant’s budget (which was allowed).

Discussion

This decision indicates that costs budgets may be determined retrospectively where, for whatever reason, items of dispute were not resolved at the time those were filed. Practitioners would be wise to ensure that at a CCMC the court is invited to determine all of the issues it needs it to. However, in this case, the retrospective determination of costs budgeting was not a barrier to the Claimant being granted the subsequent revisions it was seeking.

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