Hanshow v. VusionGroup, Order of the Court of Appeal of the UPC, 21 February 2025, Case no. UPC_CoA_618/2024
In Hanshow v. VusionGroup, VusionGroup argued that Hanshow’s appeal of the Munich Local Division’s (LD) decision on costs should be rejected on the grounds that Hanshow had not properly filed the appeal brief and grounds and that Hanshow had not paid the additional court fee in time. The Court of Appeal dimissed VusionGroup’s applications, holding that Hanshow had in fact paid the court fee in time, and that the filing of a separate appeal and grounds for appeal is unnecessary where a party has already applied for application for leave to appeal (which already sets out the reasons for the appeal).
Background
The Munich LD dismissed VusionGroup’s application for a PI on 20 December 2023 and ordered VusionGroup to pay costs. The Court of Appeal dismissed its appeal on 13 May 2024 and VusionGroup was ordered to pay the costs of the appeal proceedings as well.
On 18 June 2024, Hanshow applied to the Court of Appeal for the assessment of costs with regards to the appeal proceedings and requested an extension of the deadline (as the time limit for initiating cost proceedings is one month).
On 29 July 2024, the Judge-Rapporteur (JR) of the Court of Appeal ruled that Hanshow should have applied for costs before the Court of First Instance. The application was subsequently referred to the Court of First Instance with the Court of First Instance being directed that the application date be considered as 18 June 2024 (which was the date of Hanshow’s application to the Court of Appeal). This was because this was the first time this issue had arisen in UPC proceedings and therefore the Court of Appeal was more lenient.
On 2 August 2024, Hanshow initiated corresponding cost proceedings in the Munich Local Chamber which ultimately rejected the retroactive extension of the time limit as inadmissible, and subsequently, Hanshow’s application for costs was rejected on the basis that it was filed after the one-month deadline (13 May–18 June) under R. 151 RoP.
Hanshow appealed for leave to appeal on 31 October 2024, which was accepted by the Court of Appeal on 15 November 2024 (R. 221.3 RoP). On 21 November 2024, the judge instructed Hanshow to pay an additional court fee of €1,500 before 5 December 2024.
Arguments
VusionGroup argued that Hanshow’s appeal be rejected on the grounds that Hanshow had not properly filed the appeal brief and grounds within 15 days of service of the decision granting leave to appeal as required under R. 224 RoP. VusionGroup also applied for a default decision on the basis that Hanshow had not paid the additional court fee in time.
Decision and reasoning
The Court of Appeal found that Hanshow had paid the additional court fee in time because it was credited on 5 December 2024, therefore, VusionGroup’s application for a default judgment was dismissed.
The Court held that a separate appeal and grounds for appeal is unnecessary if a party has already applied for discretionary review under R. 220.3 RoP. The application for leave to appeal already sets out the reasons for the appeal. R. 220.4 RoP provides that, after granting the application for discretionary review, the permanent judge shall order whether, and “if so”, which further procedural steps are to be taken by the parties and within what time limits. According to the case-law on R. 220.3 RoP, if the permanent judge grants a request for discretionary review, once the appeal has been assigned to it, it may consider it necessary for the parties to file a further statement of grounds of appeal and response in addition to the submissions already made, however this will not always be necessary. It was found that this same reasoning should apply to whether an appeal against a decision on costs is allowed.
Comment
Given that the reasons for applying for leave to appeal a cost decision are already included within the application itself, it is understandable that the court found that it was not necessary to then file a separate further appeal brief and grounds as this would be inefficient.
This decision did not deal with whether Hanshow’s appeal will be accepted by the Court of Appeal. It is curious that on 29 July 2024 when the Court of Appeal directed that the Court of First Instance consider Hanshow’s application date to be 18 June 2024 (which was the date of submission to the Court of Appeal), the Court of Appeal did not give any indication as to whether it would find the retroactive extension of the time limit to be admissible given that even this earlier application date of 18 June 2024 was still later than one month after its judgment handed down on 13 May 2024. Indeed, Hanshow on 18 June 2024 had requested an extension of the deadline.
It is unlikely that the Court of Appeal will find the retroactive extension of the time limit to be admissible. The one-month deadline for filing cost applications exists to protect the party ordered to pay costs, as after a one-month period they will want to have certainty that no further cost claims will arise. Hanshow will likely need to show that the delay in submitting their application for the assessment of costs was due to exceptional circumstances (Hanshow will be unable to successfully argue, for example, that the delay arose as they were unsure as to which court they should make their costs application to).
The order is here.
