The principle is not limited to mortgages. A lease agreement often includes contractual compensation for enforcement, whether it is service charges (long-term leases) or rent (shorter leases and commercial leases). There are a number of other contexts in which contractual compensation may be created, including a service, partnership, joint venture, transaction agreement (see Russell/Cartwright) or other trade agreements in which the parties can agree among themselves that the cost of applying certain conditions lies with a particular party. 23. As a result… I think there is a need for a great deal of caution in the exercise of such a right in this proceeding. Indeed, before the recent procedural reforms, I think most judges would have said that this would not be possible. A new means must be the subject of a new procedure. However, in the new climate, I think a more informal approach could be possible if we could see that there would be unnecessarily additional costs if the case was left in a new procedure. Nevertheless, I think it is fair to do so only when it is clear that a claim for contractual damages cannot be defended, so that a summary judgment would have been rendered in PW`s favour in the event of a new appeal… (Added highlight.) It was argued that, in both cases, the costs under a contract should be unrecoverable. Similarly, in an appropriate case, it could be argued that behavioural issues could deter a party receiving contractual compensation from availing itself of this award.
In addition, in the exercise of legal discretion, CPR 44.6 expressly authorizes the court to take into account the costs to be paid contractually. Ferris J. explicitly referred to the Court of Appeal`s decision in Gomba Holdings Ltd/Minories Finance, in which a law-based cost order on a standard basis does not preclu her contractual or fair right of a real estate creditor to pay damages. However, in the Holding Gomba, the Court of Appeal had allowed the contractual basis to exceed the legal order with respect to the ongoing detailed assessment procedure, while Ferris J in John was not satisfied that a legal order should be amended; Given the complexity of the facts, defendants should instead avail themselves of a contract-compliant right. In John, Ferris J stated in points 21 to 23: Often, at the end of the proceedings, costs are assessed according to the Tribunal`s legal authority to award costs (see Article 51 of the Senior Courts Act 1981) without explicit reference to the contractual provision, if at all. In the first case, there is a cost finding, but not in accordance with the contract, and in the latter case, there is no costing. If there is no strict Estoppel, the second argument (where there has been no cost scale) must be more difficult: the principle set out in Johnson/Gore Wood-Co (No. 1) must be based on the principle that, in the event of compensation, the party could and should have asserted all the rights at once.