On 31 July 2026 the Court of Appeal handed down its judgment in Orton v Barclays Bank UK plc [2026] EWCA Civ 1025 concerning the court’s power to make a costs award on the small claims track (“SCT”) on the grounds of unreasonable behaviour.

The claimant’s PPI Plevin claim was allocated to the SCT, where costs may not be awarded against a party unless (among other things) it has “behaved unreasonably”: CPR 27.14(2)(g). After sending a series of letters to the claimant’s solicitors inviting him to discontinue the claim, four weeks before trial the defendant’s solicitors warned that, unless he discontinued by a stated deadline, the defendant would seek its costs. Twelve days before trial but after that deadline the claimant discontinued. He did so on the basis of a commercial decision that, given the defendant’s unwillingness to settle, his need to instruct counsel for trial and the claim’s low value, it made little sense to proceed.

The District Judge (“the DJ”) held that the claimant had behaved unreasonably by discontinuing when he did, and made a costs award against him. Her decision was upheld on first appeal. The claimant appealed to the Court of Appeal (“CA”).

The CA allowed the appeal. The lead judgment was given by Cockerill LJ (Bean and Andrews LJJ agreeing). The DJ’s approach was wrong in law.  Disapplication of the costs-neutral regime had to be justified by something which was “unambiguously unreasonable”. The DJ was also wrong to focus on interrogating the explanation for discontinuance and to characterise the defendant’s correspondence as containing offers to settle.

The decision is a significant win for consumers and others bringing claims on the small claims track against better-resourced defendants.

Robert Weir KC, Jonathan Butters and Tom Westwell acted for the successful claimant, instructed by Kavon Hussain of Consumer Rights Solicitors.