Underpayment of court fee by £24 sees claim thrown out

The importance of not leaving it until the last minute to issue claims and ensuring that the correct court fee is paid was highlighted in Peterson & Anor v Howard De Walden Estates Ltd [2023] EWHC 929 (KB).

In Peterson, the Court threw out a claim after solicitors acting for the Claimant underpaid the court issue fee by £24 and, as the claim was delivered to the court on the cusp of limitation, the result was that the Claimant was unable to rectify the mistake and the statutory deadline within which to issue the claim was missed.

Background

The Claimants had agreed terms of acquisition in relation to a new lease with the Defendant on 25 November 2021.  Pursuant to section 48(3), (5) and (6) of the Leasehold Reform, Housing and Urban Development Act 1993 (the “Act”), if the new lease had not been completed by 25 January 2022, the Claimants had until 25 March 2022 (the “Statutory Deadline”) to apply to the Court for an order under s48(3) of the Act.  Pursuant to s53(1)(b) of the Act, in the absence of an application being made by the Statutory Deadline, the Claimants’ notice to exercise the right to acquire a new lease would be deemed withdrawn.

On 23 March 2022, two days before the Statutory Deadline, the Claimants’ solicitors attended the Central London County Court and lodged the claim form in the court’s post box which would be treated as having been received that day.  However, the Claimants’ solicitors, in their covering letter accompanying the claim form, gave the court authority to deduct the court fee of £308, when the fee payable was £332 (having increased in September 2021).  The Court refused to issue the claim and returned the papers to the Claimants’ solicitors on 24 March 2022, which were not received by the Claimants’ solicitors until 30 March 2022 by which time the Statutory Deadline had passed.

The Claimants made an application for an order under rule 3.10 of the Civil Procedure Rules (“CPR”) on the basis that there had been an error of procedure which the Court had the power to remedy.

The Court’s decision

The Court, both at first instance and on appeal, rejected the Claimants’ arguments.  Although there are authorities that would support an argument that failure to pay the correct fee does not mean that a claim had not been “brought” for limitation purposes, the Claimants in Peterson accepted that their claim had not been “brought”, and in light of that concession, the Court based their findings on the intent and effect of CPR 3.10.

The Court found that “…it is the issue of the claim form that marks the commencement of proceedings and it is only then that the court’s case management powers under CPR 3.10 are engaged.”

As the claim form had not been issued, the Court found that it did not have jurisdiction under CPR 3.10.

This decision highlights the risks of issuing claims at the cusp of statutory deadlines/limitation.  Early action should be taken by claimants to ensure that if there is any procedural error, this can be remedied in good time.

How we can help

If your solicitor has made an error that has resulted in a claim being struck out or has failed to ensure that proceedings have been issued within limitation, we may be able to assist you in bringing a professional negligence claim.

If you require advice and/or representation in respect of potentially negligent advice/legal representation, contact our civil litigation solicitors by sending us an email, completing our online enquiry form or calling on 020 3813 5366