Julian Lindsay Fernandez v Leessa Karen Fernandez & Anor [2025] EWHC 2530 (Ch)

[2025] EWHC 2530 (Ch)Case No CH-2025-BRS-000001IN THE HIGH COURT OF JUSTICEVenue BUSINESS AND PROPERTY COURTS IN BRISTOLCHANCERY APPEALS (ChD)ON APPEAL FROM DISTRICT JUDGE WALESVenue Bristol Civil Justice Centre, 2 Redcliff Street, Bristol, BS1 6GRDate 6 October 2025
Before
HHJ PAUL MATTHEWS(sitting as a Judge of the High Court)
Between
JULIAN LINDSAY FERNANDEZAppellant
Julian Reed (instructed by Kitson & Trotman) for AppellantToby Bishop and Hugh Jeffery (instructed by Charles Russell Speechlys LLP) for RespondentsConsequential matters, dealt with on paper
This judgment was handed down remotely at 10:30 am on 6 October 2025 by circulation to the parties or their representatives by e-mail and by release to the National ArchiveHHJ Paul Matthews :

Introduction

[1]On 22 September 2025, I handed down my written judgment, under neutral citation number [2025] EWHC 2373 (Ch). This dismissed the appeal by Julian Fernandez against the order made by DJ Wales on 3 December 2024 in the litigation with his siblings Nick and Leessa (“the respondents”). The order removed Julian as executor of the estates of their parents, and also of a trust made by them during their lives. I invited written submissions on consequential matters, which I subsequently received and have now considered.[2]There are five matters raised:(i) the incidence of costs,(ii) the basis of costs,(iii) payment on account of costs,(iv) interest on costs, and(v) Julian’s indemnity against the estates and trust fund. I will deal with them in turn. There is however no application for permission to appeal to the Court of Appeal. Because that would be a second appeal, only that Court can give such permission: CPR rule 52.7.

The incidence of costs

[3]I deal first with the incidence of costs. The rules on costs are well known. Under the general law, costs are in the discretion of the court: Senior Courts Act 1981, section 51(1); CPR rule 44.2(1).

(a) However, the court may make a different

[4]The respondents ask for their costs, and on the indemnity basis. In his submission dated 25 September 2025, Julian says:
“53. The Appellant therefore respectfully invites the court to order that the Respondent is not invited to recover costs.” (I assume that “invited” is a mistake for “entitled”.) Yet the draft order provided by Julian with the same submission says instead that Julian is to pay his siblings’ costs “on the standard basis if not agreed”
. So, it is not clear what Julian’s position is, and I must decide the question for myself.[5]First, I ask myself whether the court should make a costs order. Unfortunately, today, litigation costs a significant amount of money. This was a serious dispute between a personal representative and beneficiaries of the estate about who should administer the estates concerned. It was proper to bring it to court, and to obtain the court’s decision. The appeal against that decision has failed. in my judgment it is right to make a costs order.[6]Next, I need to consider which party, for the purposes of the “general rule” in rule 44.2(2)(a), was the successful party overall. In my judgment, this was the respondents. The appeal failed. And so the general rule would indicate that I should make an order in favour of the respondents. Is there any reason not to do so here? On the face of it, I can see none.[7]What Julian says is that CPR PD 44, paragraph 9.5(4), requires that a costs statement be filed and served not less than 24 hours before the time fixed for the hearing. However, in this case the respondents served their statement of costs at 17:48 on the day before the hearing. So Julian says that, because this was after 16:00, it was deemed served on the next day, that is, the day of the hearing. He cites no authority for that proposition.[8]I agree that CPR PD 5B, paragraph 4.2(8), provides that an email received by the court after 16:00 is treated as received on the next day that the court office is open. But there is no equivalent for service on parties (compare CPR PD 6A, paragraph 4). And it is the parties who need the statement more than the court. Judges usually do not look at the costs statements at all before costs are dealt with at the end of a hearing. Julian says that no explanation has been given by the respondents for breaching the rule, and that similar breaches of the rule by them in the past mean that “the Respondents should not recover their costs”.[9]I reject this submission, which is, frankly, absurd. It would be disproportionate to hold that failure to comply with the practice direction meant that a successful party could not otherwise recover costs at all: see eg Macdonald v Taree Holdings Ltd [2001] 1 Costs LR 147 (Neuberger J), on appeal [2001] EWCA Civ 312 (May LJ). Neuberger J said:
“23. … Where there is a failure to comply with the Practice Direction and a schedule of costs is not served more than 24 hours before the hearing, the court should take that into account but its reaction should be proportionate… [ … ] 26. I do not take the view … that in a case of mere failure to comply, without more, it would be right to deprive a party, otherwise entitled to a summary assessment of his costs, of his costs altogether.”
[10]Julian says (correctly) that this case was decided before the “Jackson” costs reforms of 2013. But that decision has been followed subsequently, for example by Nugee J in Kingsley v Orban [2014] EWHC 2991 (Ch), and most recently by Leech J in Whittaker v Bertha UK Ltd [2023] EWHC 2554 (Ch).[11]In the present case, Julian had the statement the evening before the hearing, when Julian’s counsel would have been preparing for the appeal the next day. So any prejudice would be minimal. In any event, costs statements are required to be served under paragraph 9.5 “to assist the judge in making a summary assessment of costs” (see paragraph 9.5(1)). Yet (as I hold below) the present case is not one for summary assessment. So in fact Julian is not prejudiced at all. This complaint goes nowhere. It is formalism of the most unthinking kind. Accordingly, I will order Julian to pay the respondents’ costs of the appeal.

Basis of the assessment of costs

[12]Next, I deal with the basis of the assessment of costs. As I pointed out in my earlier judgment, the indemnity basis of costs assessment was discussed by Hildyard J in Hosking v Apax Partners Ltd [2019] 1 WLR 3347, [42], [43]. There,

the judge said:

"42. The emphasis is thus on whether the behaviour of the paying party or the circumstances of the case take it out of the norm. The merits of the case are relevant in determining the incidence of costs: but, outside the context of an entirely hopeless case, they are of much less, if any, relevance in determining the basis of assessment. 43. The cases cited show that amongst the factors which might lead to an indemnity basis of costs are (1) the making of serious allegations which are unwarranted and calculated to tarnish the commercial reputation of the defendant; (2) the making of grossly exaggerated claims; (3) the speculative pursuit of large-scale and expensive litigation with a high risk of failure, particularly without documentary support, in circumstances calculated to exert commercial pressure on a defendant; (4) the courting of publicity designed to drive a party to settlement notwithstanding perceived or unaddressed weaknesses in the claims."
[13]But, of course, these are not the only things. In seeking indemnity costs, the respondents rely on what they call (i) Julian’s unreasonable refusal to mediate; (i) Julian’s pressing for an unwarranted factual enquiry in pursuit of an unjustified case; (iii) Julian’s making and failing to withdraw improper allegations; (iv) Julian’s pursuit of resolution of what he called the “central issues”; (v) Julian’s misdescription of the ratio of authorities cited to the court by him; (vi) the elaborate and repetitive nature of Julian’s grounds and skeleton arguments; (vii) other actions by Julian.[14]Julian submits that his conduct of the appeal cannot have been out of the norm, because Michael Green J gave permission to appeal. He says that it “is a strong indication that the appeal was not speculative, abusive or otherwise ‘out of the norm’,” otherwise “permission to appeal would not have been granted.” I do not accept this submission. The test for giving permission to appeal is not whether the appellant’s conduct has or has not been out of the norm, but instead whether the appeal has a real prospect of success, or there is some other compelling reason. I turn therefore to the various points relied on by the respondents.[15]Point (i): On 14 April 2025, the respondents put forward 26 dates for mediation (5 dates in May, and 21 in June). They chased for a response on 9 May 2025, and again on 8 June 2025. A holding response was sent on 13 June, but a substantive response from Julian was received only on 23 June 2025, some ten weeks after 14 April. This reply said that none of the 26 proposed dates was possible, and also that on 10 June notice of the appeal hearing on 8 July 2025 had been received, so that it was unlikely that mediation could take place before the hearing.[16]In my judgment, it is unacceptable to take so long to respond to the mediation offer and suggested dates, especially when the answer was No. There was no explanation as to why this could not have been said on 13 June, let alone much earlier. It is equally unacceptable not to be able to make some re-arrangement which would enable the parties to mediate on at least one of those 26 dates. Not everyone on the team is needed. Even if it were acceptable so to behave, it is unacceptable not at least to try to find further dates, even close to the appeal hearing. It is patently obvious that Julian just did not wish to mediate.[17]Of course, there are cases where it is reasonable not to mediate. But, in my judgment, this was not one of them. And, even where it is unreasonable not to do so, that failure is simply a factor to take into account: Gore v Naheed [2017] 3 Costs LR 509, [49]. However, in the present case, in my judgment, Julian’s behaviour in frustrating the mediation purpose justifies a costs sanction. As Jackson LJ said in Thakkar v Patel [2017] 2 Costs LR 233, [31], “ … The message which the court sends out in this case is that in a case where bilateral negotiations fail but mediation is obviously appropriate, it behoves both parties to get on with it. If one party frustrates the process by delaying and dragging its feet for no good reason, that will merit a costs sanction … ”[18]In a case where the successful party unreasonably fails to mediate, that sanction can involve a reduction in costs receivable. Here it is the unsuccessful party that should be sanctioned, so the court cannot reduce the costs receivable. Instead, the appropriate sanction may be to award indemnity costs. In my judgment, it is appropriate to do so on the facts of this case.[19]Points (ii) and (iv): I can deal with these points together. Julian insisted on pursuing matters other than whether or not he should be replaced, although the replacement issue was the point of the counterclaim which was still to be tried. What he called the “central issues” were not even pleaded. This is indeed conduct out of the norm.[20]Point (iii): Julian’s counsel submitted in writing on the appeal that the respondents’ counsel had wrongly submitted that(a) DJ Watson had not had his attention drawn to the decision of Chief Master Marsh in Schumacher v Clarke [2019] EWHC 1031 (Ch), and that(b) DJ Watson had not considered that authority, and that both assertions were false. However, it is clear from the transcript of the hearing before DJ Watson that Schumacher v Clarke was not referred to, and, indeed, Julian’s counsel accepted that it was so during the hearing before me. Yet Julian’s counsel did not seek to withdraw his submission. I consider that a lack of courtesy from one member of the Bar to another is highly regrettable, and in my experience it is abnormal, but I am not prepared to visit it upon Julian’s head.[21]Point (v): My view of the treatment by Julian’s counsel of the authorities can be seen in my judgment. On the material before me, I am not prepared to reach the conclusion that counsel deliberately chose to cite authorities for propositions for which he thought they did not stand, and I proceed instead on the basis that he mistakenly thought that they did. And, these days at least, I do not think that misunderstanding authorities is conduct out of the norm justifying indemnity costs.[22]Point (vi): The grounds of appeal and skeleton arguments were over-elaborate, repetitive, and difficult to follow. But, although this is regrettable, because it makes the judge’s task more difficult, in my judgment this is not of itself conduct out of the norm justifying indemnity costs.[23]Point (vii): In light of what I have said in the preceding paragraphs, it is not necessary for me to reach a conclusion on these lesser points.[24]In my judgment, my conclusions on points (i), (ii) and (iv) amply justify an award of costs on the indemnity basis.

Summary or detailed assessment

[25]The next question is whether costs should be assessed by me summarily, or sent off for detailed assessment by the costs judge. Initially, at least, the parties appeared to be agreed that this was a case for detailed assessment. In their submission of 22 September, the respondents said that the costs of the 2019 hearing and the 2024 hearings were to be subject to detailed assessment, and they submitted that the costs of the appeal should be likewise. Their own draft order reflected that.[26]Julian’s responsive submission of 25 September did not expressly say that there should be detailed assessment. But it did deal on its merits with the submission that there should be a payment on account, and this implies a detailed assessment. His own draft order was ambiguous in this respect. However, Julian’s further submission dated 30 September (in reply to that of the respondents dated 28 September) says:
“18. … Summary assessment is suitable and generally used for any hearing lasting 1 day or less (CPR PD 9.2(b)). There is nothing complex about the appeal costs which would prevent the court from summarily assessing the cost or warrant the time and costly exercise of detailed assessment. Just because those detailed assessments are in place already does not mean that we need to add to it and have another detailed assessment.”
[27]Julian has referred only to part of CPR PD 44 paragraph 9.2. He has omitted the final part. The whole provides that the “general rule” is that the court should make a summary assessment for the costs of a hearing, which has lasted not more than one day “unless there is good reason to do so, for example where the paying party shows substantial grounds for disputing the sum claimed for costs that cannot be dealt with summarily.”[28]However, in the present case, it is clear from Julian’s submissions on a payment on account (dealt with below) that there are significant challenges to the costs claimed, which I am unable to resolve in a summary procedure. There is accordingly a good reason for ordering a detailed assessment, and I will do so.

Payment on account of costs

[29]Next, I consider the question of a payment on account of costs. CPR rule 44.2(8) provides that: "Where the court orders a party to pay costs subject to detailed assessment, it will order that party to pay a reasonable sum on account of costs, unless there is good reason not to do so".[30]In Excalibur Ventures LLC v Texas Keystone Inc [2015] EWHC 566 (Comm), Christopher Clarke LJ said:
"22. It is clear that the question, at any rate now, is what is a 'reasonable sum on account of costs'… 23. What is a reasonable amount will depend on the circumstances, the chief of which is that there will, by definition, have been no detailed assessment and thus an element of uncertainty, the extent of which may differ widely from case to case as to what will be allowed on detailed assessment. Any sum will have to be an estimate. A reasonable sum would often be one that was an estimate of the likely level of recovery subject, as the costs claimants accept, to an appropriate margin to allow for error in the estimation. This can be done by taking the lowest figure in a likely range or making a deduction from a single estimated figure or perhaps from the lowest figure in the range if the range itself is not very broad."
[31]The total of the respondents’ statement of costs for the appeal was £77,663.91 (including VAT), compared with £67,046.34 (including VAT) for Julian’s. The respondents ask for 60% of their figure, rounded down to £46,000, and payable in 14 days. Julian submitted that it was “inappropriate to rely on the Respondents’ costs schedules”, because they were “inflated and disproportionate”. He commented that appellants’ costs were always greater than respondents’. As he put it, “Responding to an appeal is sitting in the box seat – simply saying the judge below was correct”. The respondents say that they had to spend “time and resources to unpick the sheer volume of mis-directions of fact and law that [Julian] has advanced”.[32]I cannot resolve this dispute summarily. That must be left to detailed assessment. I have to decide whether to order a payment on account and, if so, in what sum. As to the former question, the rule requires me to make such an order “unless there is good reason not to do so”. So, the burden lies on Julian to persuade me not to. His submissions really go to quantum rather than to the principle, although he does say that where a costs schedule is inflated or disproportionate it would be inappropriate to order a payment on account. I disagree that there is any automatic connection. In the present case I am not satisfied that there is a good reason not to order a payment on account.[33]As to quantum, there are a number of points that I must bear in mind. One is that the rates sought by the respondents exceed the guideline rates, and will therefore need to be justified. Another is that there are questions raised about some of the specific work charged for by the respondents’ solicitors, and about possible duplication of effort (which can only be resolved on detailed assessment). As Julian says, DJ Wales himself expressed some concerns about the respondents’ costs below. I think I should be cautious, but not over-cautious. I will therefore order Julian to pay a sum equal to 50% of the £77,663.91, that is £38,832 (to the nearest pound) within 14 days.

Interest on costs

[34]I turn now to consider the question of interest on costs. CPR rule 44.2(6)(g) provides that the court may order “interest on costs from or until a certain date, including a date before judgment”. In Involnert Ltd v Aprilgrange Ltd [2015] EWHC 2834 (Comm), [7], Leggatt J commented that “This power is now routinely exercised when an order for costs is made following a trial to award interest at a commercial rate from the dates when the costs were incurred until the date when interest becomes payable under the Judgments Act.”[35]The respondents ask for interest at 2% above bank base rate from the dates on which they paid the invoices for their legal costs. Julian says that where a costs schedule is inflated or disproportionate it would be inappropriate to order interest on costs. I do not agree. Interest will be paid on the costs actually allowed on detailed assessment, not on those claimed in the costs schedule prepared for summary assessment. I will order interest at 2% above bank base rate (which I consider to be an appropriate rate) from the dates on which the respondents paid the invoices for their legal costs until judgment.

Julian’s indemnity

[36]Lastly, I turn to consider the question of Julian’s right to an indemnity from the estates and trust fund, not only in respect of his own legal costs, but also costs that he is liable to pay to the respondents. I dealt with the law relating to this at paragraphs [87]-[94] of my substantive judgment, and I shall not repeat that here. I held that the judge below was entitled to reach the conclusion that Julian should be deprived of his indemnity for the costs of hostile litigation, though not for the costs of his administration of the estates and the trust.[37]The respondents now seek a similar order that Julian be deprived of his indemnity for the costs of this appeal. So far as I can see from his written submissions, Julian does not respond to that. In my judgment, Julian conducted this appeal entirely in his own interest, and not at all in the interests of the estates or the trust. Accordingly, Julian’s costs, and those of the respondents that he is ordered to pay were not properly incurred within section 31(1) of the Trustee Act 2000, and he is not entitled to an indemnity in respect of them: see CPR PD 46 para 1.1(b). I will so declare.

Conclusion

[38]I accordingly conclude that I should order Julian to pay the respondents’ costs of the appeal on the indemnity basis, to be subject to detailed assessment if not agreed, with interest running on those costs at 2% above base rate from when they were paid to judgment. Julian is to pay £38,832 on account of costs by 4 pm on 20 October 2025. Finally, Julian will not be entitled to any indemnity out of the estates or the trust fund for his own costs of the appeal or for the costs liability which he has incurred towards the respondents.

order

CPR rule 44.2(2)(b). In deciding whether to make an order, and if so what, the court will have regard to all the circumstances, including “the conduct of all the parties” and any admissible offer to settle the case (not falling under CPR Part 36) which is drawn to the court’s attention: CPR rule 44.2(4).