20.05.2015Network Rail Infrastructure Ltd. v Handy; Ingram; Rob Hatfield Ltd.; Parry; Godley  EWHC 1460 (TCC)
Key areas: Basis of assessment; party’s conduct; High Court
This was a hearing to determine costs issues arising from a successful claim.
The parties agreed that the Defendants were liable for the Claimant’s costs, but the argument was over the basis of assessment: the Claimant submitted they should be on the Indemnity Basis; the Defendants, on the Standard Basis.
The Court noted that the Defendants’ expert evidence was “to a large extent not accepted”, and he made concessions under cross-examination, but that was because the cross-examination was “effective”. It also noted that the expert was not as experienced as the Claimant’s expert.
As a result, the Court held that the Defendants had a bona fide case, which was arguable but became weaker as the case progressed, and so the Claimant was awarded its costs on the Standard Basis.
14.05.2015Raymond; Raymond v Young; Young  EWCA Civ 456
Key areas: Indemnity Basis; Basis of assessment; party’s conduct; Court of Appeal
This was an appeal against rulings made at first instance, including costs.
At first instance, the Claimants had been awarded £155,000 damages for harassment and nuisance, plus costs, all of which were to be assessed on the Indemnity Basis, due to the Defendants’ conduct throughout the case. The Defendants appealed.
The Defendant submitted that it was wrong to make an Order based upon the conduct that led to the claim, not conduct during the proceedings.
The Court noted that the Judge had taken into account the Defendants’ conduct during the proceedings, due to their own “unrealistic claims and assertions”; and that the Claimants had made “unfounded or invented” as “part of a campaign… to drive them out”.
At first instance, it was held that the Defendants’ submissions were false, and that they knew this all along.
As a result, the Court upheld the Order for costs on the Indemnity Basis, due to the party’s conduct.
13.05.2015Kagalovsky & Anor v Balmore Invest Ltd. & Ors  EWHC 1337 (QB)
Key areas: Wasted Costs Order; costs against Solicitors; High Court
This is an application for a Wasted Costs Order for costs against solicitors and Counsel(“the Respondents”).
The Claimant had obtained a committal order against the Eighth Defendant, but he was out-of-jurisdiction, and the Claimant had incurred extra costs in trying to extradite him.
The Claimant therefore sought to obtain an Order that his legal representatives pay the Claimant’s costs.
The Claimant raised 6 arguments in support: a “dishonest defence” and delays in a committal application; the solicitors’ actions leading to an application for disclosure, providing “misleading information” to try and defend it, and their subsequent failure to comply with it; and the “pursuit of irrelevant topics” in a cross-examination at trial.
The Respondents submitted that a summary application was not appropriate for a complex application, nor was an application for wasted costs; that the Claimants had delayed their application; that there were issues of legal privilege; that the allegations had changed over time; that there was not sufficient information to justify an Order; and that the Claimant were unable to show that the Respondents were responsible.
The Court noted that the allegations concerned issues that were not part of the main case; that they raised allegations against long-standing professionals against whom there had not previous issues; that there was a large number of allegations and supporting material meant it could not be “plain and simple”; and that the amount of time required to deal with the issues meant that it was “inconsistent” with summary application.
As a result, the application was dismissed.
11.05.2015Cashman v Mid Essex Hospital Services NHS Trust  EWHC 1312 (QB)
Key areas: Part 36 offer; High Court
This was an appeal against a ruling made on Detailed Assessment, arising out of a clinical negligence claim.
The Claimant’s Bill of Costs totalled £262,000, and 5 weeks after Points of Dispute were served made a Part 36 offer for £152,500. Costs were eventually assessed at £173,700.
At the DA, the Court noted that the Defendant had failed to beat the Claimant’s offer at trial, but refused to allow the additional sum under CPR 36.14, which would have been approximately £17,000. The Claimant appealed.
On appeal, the Defendant submitted that the Claimant’s Solicitors have benefitted due to being awarded success fees, and that costs should be dealt with differently to damages because they are difficulty for a party to assess.
The Claimant submitted that all the potential factors were in his favour, and that the Defendant had not sought any additional information from the Claimant so that it could assess the offer. The Defendant responded that there is no mechanism for disclosure in costs proceedings.
The Court held that the Claimant had been penalised by making a reasonable Part 36 offer, and not receiving the bonus figure, and so allowed the appeal.
05.05.2015James v Ireland  EWHC 1259 (QB)
Key areas: RTA; Part 45; success fee; High Court
This was an appeal relating to fixed success fees in an RTA.
On the first day of trial, the Court allowed an application to adjourn the quantum trial until after liability had been dealt with.
The Court then stood-out the liability issue, and the case settled before the trial re-started the day after.
At first instance, it was held that the liability trial had started before it was stood-out, and so the 100% fixed success fee applied under old-CPR 45, Section III. The Defendant appealed.
On appeal, the Defendant held that the case was stood-out due to additional disclosure which only occurred after the quantum trial had been adjourned. As a result, the liability trial did not open.
The Claimant submitted that whether the trial “opened” was a matter of fact for the first-instance Judge to determine.
The Court noted that due to the additional disclosure, the judge in the main action stated that he was going to reserve liability arguments to himself, which was a “strong indication” that the liability trial did not start.
As a result, the appeal was allowed, and so the lower success fees applied.
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