Devon County Council v Celtic Bioenergy Ltd [2014] EWHC 309 (TCC)

This summary was provided by CMS Cameron McKenna LLP.

For more information visit


In this costs-only judgment, the Court dealt with the parties’ respective liability for costs following an application to the Court for an injunction restraining an adjudication from going ahead and for declarations that the Adjudicator had no jurisdiction. Costs that were considered disproportionate to the importance and complexity of the application were reduced. Furthermore, it was decided that it would not be an abuse of the process for the Claimant to raise at a later date issues not resolved by the Court at the original hearing of the Claimant’s application. However, in view of the Court’s decision to allow the bulk of the adjudication to go ahead, these issues should only be raised if they remained unresolved after the Adjudicator had reached his decision.

Technology and Construction Court, Mr Justice Stuart-Smith


Celtic Bioenergy Ltd (“Celtic”) were engaged by Devon County Council (“Devon”) to design and construct an in-vessel composting facility in Devon. Disputes between the parties arose leading to nine adjudications. Celtic was insolvent and was able to pursue proceedings as a result of a deed of assignment with Knowles Ltd (“Knowles”), giving Knowles the right to receive all sums due to Celtic under the contract between the parties. Knowles also provided Celtic with legal representation and charged for doing so.

By a Notice of Adjudication dated 6th December 2013, Celtic referred various matters to adjudication (the ninth). When the Notice was issued, Celtic had failed to pay a sum of just under £70,000 due to Devon as a result of previous adjudications (despite numerous requests for payment). It was Devon’s view that the Adjudicator did not have jurisdiction to decide the referred matters. Devon issued an application on 18th December 2013 asking for three orders. (1) An interim injunction restraining any further steps in the adjudication (2) An order for alternative service on ‘the Defendant’s representatives Knowles Ltd’ (3) An order abridging time for Celtic’s Acknowledgment of Service. Proceedings were issued on 19th December 2013 and claimed a declaration that the Adjudicator had no jurisdiction and an injunction restraining Celtic from taking further steps in the adjudication or issuing any further adjudication until it had discharged its existing liability under the previous ones. The application was listed before Ramsey J on 20th December 2013. Ramsey J was persuaded to adjourn the application for the interim injunction when Knowles sent a letter stating that Devon had not submitted an invoice, and that the existing liability would be discharged if it did. The invoice was subsequently issued and paid. Ramsey J gave permission for the proceedings to be served by delivery to Knowles and gave directions to enable Devon’s application for a declaration to be heard on 17th January 2014. He reserved the question of costs of the application for the injunction and the directions that he had just given. Devon’s claim for a declaration came, therefore, before the Technology and Construction Court on 17th January 2014. At that hearing the Court held that the Adjudicator had jurisdiction to deal with the bulk of the matters referred to him. The Court ordered that Devon should pay Celtic 70% of Celtic’s costs of Devon’s claim for declaratory relief and that Celtic should pay Devon 100% of Devon’s costs of the injunction hearing on 20th December 2013. The parties were unable to agree on the amounts of the costs involved and the matter therefore came back before the Court.

Celtic relied upon Andrew Mitchell v Newsgroup Newspapers Ltd [2013] EWCA Civ 1537 and CPR Practice Direction 44 para 9.5(4)(b) and 9.6 to argue that because Devon had failed to comply with CPR Practice Direction 44, which required Devon to serve a Schedule of Costs at least 24 hours before the hearing, Devon’s costs of the injunction hearing should be disallowed completely or significantly reduced.


The Court had to decide the following issues:

  • What costs were payable by Celtic regarding Devon’s application for an interim injunction restraining the adjudication;
  • What costs were payable by Devon regarding the claim by Devon for a declaration that the Adjudicator had no jurisdiction to decide the matters referred by Celtic; and
  • Whether the hearing on 17th January 2014 resolved all issues raised by Devon’s proceedings and whether any unresolved issues should be adjourned, dismissed or otherwise disposed of.


Devon claimed costs of £11,682, excluding VAT, for the hearing on 20th December 2013. The Court reduced this figure to £8,984, considering counsel’s fees and time spent on documents to be excessive.

In making this decision the Court rejected Celtic’s argument that Devon should be penalised in costs. The failure to serve the Schedule of Costs before the hearing on 20th December 2013 had no practical effect at all. Ramsey J reserved the question of costs, so there was no question of costs being assessed at the hearing. The absence of a Schedule of Costs formed no part of Ramsey J’s reasons for reserving costs. The occasion for the issue of costs to be addressed was the hearing on 17th January 2014, by which time a schedule including the costs of the hearing on 20th December 2013 had been submitted. The fact that it was sent eighteen minutes late at 14:18 on 16 January 2014 was trivial and to be ignored. The Court took into account Devon’s failure, ‘Celtic’s conduct, the substantive irrelevance of the failure, and the complete absence of any disadvantage to Celtic’ and declined to make any deduction from its award of Devon’s costs on this basis.

Celtic claimed costs of £62,181 for the hearing on 17th January 2014. The Court reduced this figure to £31,340.

In making this decision the Court agreed with Devon that as Knowles was doing work for Celtic that could reasonably have been done by solicitors, the costs allowed should be no more than they would be had the work been done by solicitors.

The Court also considered the overall proportionality of Celtic’s costs, deciding that costs of over £60,000 for a hearing estimated to last two and a half hours (even allowing for the fact that the hearing took nearly four hours in reality) were clearly significantly disproportionate. Celtic’s costs were reduced to what the Court considered a proportionate sum for the importance and complexity of the application.

Setting off these sums produced a net liability from Devon to Celtic of £13,017.

The Court decided that not all issues raised by Devon in the proceedings were resolved on 17th January 2014. Celtic’s submission that it would be an abuse of process for Devon to raise those issues not decided in the future because ‘the Court has been asked to hear, has heard, and has disposed of, the whole of [Devon’s] claim’ was rejected. The Court decided that the fact that issues arising from Devon’s Statements of Case were not raised or resolved on 17th January 2014 was attributable to a sensible use of the Court’s resources and those of the parties.

However, the Court decided that had Devon applied for the balance of its applications to be adjourned to be resolved at a later date, this application would have been refused. This was because the Court considered that the Adjudicator had the jurisdiction to deal with the bulk of matters referred to him in the Notice of Adjudication dated 6th December 2013 and it would therefore be sensible to let him resolve those matters in the adjudication. If subsequently there were real issues that had not been resolved, ‘then (and only then) it would be a sensible use of the Court’s time and the parties’ money to raise those issues for determination.’

This summary was provided by CMS Cameron McKenna LLP.

For more information visit


Click here to read full-screen | Click here to print the case