Cubic Transportation Systems Ltd v Transport for London & Anor [2026] and the considerations given when determining an appropriate interim payment on account of costs.
Synopsis
When considering the sums to be paid on account, the Court will give consideration to the reasonableness of the sums sought by the Claimant, with the Claimant shouldering the burden to prove this, the quality of the information provided, and the circumstances of the case. This resulted in the Claimant being awarded the payment on account they were seeking and ultimately why the Defendant was unable to persuade the judge to order payment of a lower sum.
Background
This claim related to a challenge by the Claimant to the procurement carried out by the Defendant for revenue collection services. The Claimant was the unsuccessful tenderer, and the successful tenderer was an Interested Party but took no part in the proceedings other than to submit evidence.
The Defendant successfully applied for the lift of the suspension of the action to proceed to trial. The Defendant and the Interest Party sought their costs of the application and for a payment to be made on account of those costs.
The Claimant accepted responsibility for the costs of the Claimant, and it was agreed that the costs would be subject to detailed assessment. As such, an Order was made ordering the Claimant to pay the Defendant’s costs of the application.
The sums to be paid on account of costs
The Claimant were seeking costs of around £1.2 million and considered £720,866.85 to be a reasonable sum to be paid on account of costs, equating to around 60%.
The Defendant disagreed and suggested that no more than £300,000 should be payable, around 25%. The Defendant submitted that insufficient information was provided by the Claimant to enable the Defendant and the Court to consider an appropriate sum and suggested the Court exercise caution. The Defendant further submitted that there should not be a fixed percentage payable, rather a consideration of the circumstances of the case.
The Court’s findings
The Court considered the Defendant’s submissions and accepted their submissions on the principles that should apply. However, when considering the circumstances of the case, the Court found that the sums in issue were substantial, there was a high volume of witness evidence and documentation before the Court for the one day hearing, the Defendant’s own costs were estimated to be around £1.2 million and the importance of the claim was reenforced by the prestigious roll call of Counsel at the beginning of the judgement.
Therefore, the Court had no doubt that the Claimant would recover more than £720,866.85 at detailed assessment and ordered this to be paid on account.
Analysis
This matter has been useful for determining the approach taken by Courts when determining a payment on account.
The first hurdle is to demonstrate that you expect to recover at least the sums sought on account. This burden lies with the Claimant to prove. If there is any doubt that the Court will award the sums sought at assessment, it follows that the sums awarded will be reduced accordingly. Similarly, if an approved budget is available, this will increase the sums ultimately awarded, as the Receiving Party can typically expect to receive sums in line with the agreed budget.
Secondly, the quality of the information provided will impact the level of a payment on account awarded. The more accurate and comprehensive the information provided, the more reassured the Court will be about the sums they award on account.
Finally, the Court are reluctant to order a fixed percentage. The sums awarded will depend on the information available to the Court and the circumstances of the matter. As mentioned above, providing accurate and reliable information will maximise the amount the Court will award, and it is in the Receiving Party’s interest for this figure to be realistic, as the Courts remain keen to avoid ordering a sum that will ultimately need to be partially reimbursed if costs are assessed below this sum.
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