The claimants resisted an order to pay the VAT element awarded on the defendant’s legal costs. The revenue had been unable to state clearly whether the defendant would be able to recover VAT, in which case it would not be payable, or the reverse. It had at the same time become clear that costs had been invoiced to the insurers, and the claimant challenged a liability to the defendant when the bill had not been addressed to him.
Held: Costs could be claimed even if they may in fact be paid by a third party. Although the insurance company had taken over the claim, the indemnity principle had not been infringed, because the party would not look only to the insurers to pay their costs. VAT was not payable to a party who could recover their VAT as input tax. The party no longer existed, and was no longer registered for VAT. The insurers had however paid part of the VAT, and it was properly recoverable.
Judges:
Master Campbell, Costs Judge
Citations:
[2002] EWHC 9007 (Costs)
Links:
Statutes:
Costs Practice Direction 43 5.3
Jurisdiction:
England and Wales
Citing:
Cited – Davies v Taylor (No 2) HL 2-Jan-1974
The plaintiff argued that no costs had been incurred by the successful defendant, as he was insured, and the insurance company was bound to pay his costs.
Held: ‘In this case the solicitors, no doubt first instructed by the insurance company, . .
Cited – Regina v Miller and Glennie; Miller v- Glennie 1983
The question was whether or not the litigants had incurred liability for costs in cases in which they had been supported by their employer.
Held: Where the solicitor is on the record for the client in the litigation, there is a rebuttable . .
Lists of cited by and citing cases may be incomplete.
Costs, VAT
Updated: 09 December 2022; Ref: scu.175483