26.06.2013Emezie v Secretary of State for the Home Department  EWCA Civ 733
Key areas: Judicial Review; party’s conduct; Court of Appeal
This was an appeal against an order for costs.
The main action was a Judicial Review, which the parties settled in the Appellant’s favour, but the Court ordered that there be no order as to costs.
The Court noted that the first instance Judge appeared to have used out-of-date caselaw to justify his position. It also noted that the Claimant’s pre-action correspondence did not receive a response until after proceedings were issued.
As a result, the Court ordered that the Home Office pay the Appellant’s costs on the Standard Basis.
24.06.2013Grupo Hotelero Urvasco SA v Carey Value Added SL  EWHC 1732 (Comm)
Key areas: both parties win some issues; party’s conduct; High Court
The Defendant submitted that it was entitled to its costs in relation to both the claim and counter-claim. The Claimant submitted that it even though it lost both cases, it won 3 issues, and so it should be entitled to 50% of its costs of those issues, with no costs for the Defendant. It also submitted that there should be no costs relating to an adjourned hearing, but it was liable for the Defendant’s other costs.
The Claimant also submitted that the Defendant took a “scorched-earth” view of the claim, but the Court rejected this given the size of the claims, albeit that some issues were not properly arguable.
The Court held that costs of the adjournment were costs in the case, and, after taking into account the unsuccessful issues, awarded the Defendant 75% of its costs, thereby rejecting the Claimant’s claim that they themselves should be awarded 80% of their own costs. the Defendant was also awarded an interim payment of £3.75 million.
24.06.2013Igloo Regeneration (GP) Ltd.; Igloo Regeneration (Nominee) Ltd.; Igloo Regeneration Ltd.; Igloo Regeneration Partnership v Powell Williams Partnership  EWHC 1859 (TCC)
Key areas: party’s conduct; Indemnity Basis; Basis of assessment; High Court
This was a hearing to determine costs arising from an unsuccessful claim.
The Claimants accepted that they were liable for costs, but the Defendant submitted that the Indemnity Basis should apply.
During the proceedings both sides made offers, but none complied with Part 36 until October 2012.
On 1st October 2012, the Defendant made a Part 36 offer to settle for £400,000. On 3rd October 2012 Claimants made a Part 36 offer to settle for £850,000, or for £1.3 million including costs. On 9th October 2012, the Defendant increased its offer to £600,000 including interest. On 22nd October, the Claimants reduced their offer to £1.175m including costs. On 24th October 2012, the Defendant increased its offer to £800,000 including costs.
On 26th October 2012, the Claimants made a time-limited offer to settle for £729,500 plus costs. This expired. The Defendant then offered to settle for £664,750 on 30th October 2012, which was rejected.
On 2nd November 2012, the Defendant then offered to settle for £729,500 plus costs, i.e. to match the Claimants’ offer. The offer was rejected. On 14th November 2012, the Claimants offered to settle for £850,000 plus costs.
The Court held that it was “extraordinary” for the Claimant to reject an offer for an amount they had offered. As a result, Indemnity Basis was awarded from the start of the adjourned trial.
20.06.2013Newcombe v Crown Prosecution Service  EWHC 2160 (Admin)
Key areas: criminal; party’s conduct; High Court
This was an appeal by the Defendant that his costs from a set of criminal proceedings be limited to the trial itself.
The Prosecution had not offered any evidence, and the charges were dismissed. However, the Defendant was only allowed his costs of trial because he did not say that he would agree to be bound over, and so had acted unreasonably.
The Court noted that the Defendant had maintained his innocence throughout, and that the Prosecution had not considered offering a “bind over” until the complainant and main witness refused to attend.
Therefore, the Defendant was not unreasonable and was awarded his costs from central funds.
19.06.2013Walsh v Shanahan; Leonard; SLH Properties Ltd.  EWCA Civ 675
Key areas: both parties win some issues; Part 36 offer; Court of Appeal
This was a hearing to determine costs arising from an unsuccessful appeal.
At first instance the Claimant had been awarded £16,965 plus interest, but had been refused judgment on a claim for account of profits. He appealed this but lost.
At first instance the Claimant was ordered to pay 90% of the Defendants’ costs up to the date the Defendants’ Part 36 offer expired – which he failed to beat at trial – and all of their costs from that date. The Claimant appealed costs before the offer expired, on the basis that he had been awarded damages.
At first instance, the Judge decided that he should consider who won overall, and noted that the Defendants’ had lost on some issues.
The Claimant submitted that most of the Defendants’ costs up to the date their offer expired, related to defences on which they lost.
On appeal, the costs order was upheld on the basis that given the facts it was correct that the Judge took an overview, given that the majority of the claim concerned issues which the Claimant lost.
14.06.2013Mehjoo v Harben Barker (a firm); Harben Barker Ltd.  EWHC 1669 (QB)
Key areas: liability for costs; Indemnity Basis; Basis of assessment; both parties win some issues; High Court
This was a hearing to determine costs following a main action. The Claimant had lost against the First Defendant, but had won most of his claim against the Second Defendant.
The First Defendant submitted that it should be entitled to its costs in the usual way. The Claimant submitted that it had not incurred any costs that the Second Defendant incurred, because they had the same insurers and solicitors. The Court agreed, but noted that some specific costs were solely incurred by the First Defendant, and so were entitled to those particular costs, but stated that it should “decide if it is worthwhile having this assessment”.
On 21st September 2012, the Claimant made a Part 36 offer of £1.024 million, which was not accepted, and was awarded £1.09 million + interest at trial. The Claimant submitted that this entitled him to Indemnity Basis costs from when the offer expired.
The Second Defendant submitted that the offer was phrased in a way to include the First Defendant. This was rejected on the basis of CPR 36.14(1A). It also noted that even if the First Defendant’s costs were taken into account, the Claimant was still awarded more than his offer.
The Second Defendant then submitted that the offer was withdrawn on 7th May 2013. The Court noted that the draft judgment was given on 3 May 2013, but was not finalised until June 2013. The Court referred to CPR 36.9(5), which says that offers cannot be accepted at this stage, without agreement.
The Second Defendant then submitted that Indemnity Basis should be awarded because they had asked the Claimant for information, but it had not been provided. However, the Court noted that CPR 36 relates to information about the claim, not the incurred costs.
The Second Defendant finally submitted that the facts had changed since the offer was made. It stated that the Claimant had narrowed his focus of the claim, but the Court stated that did not impact the Defendant’s assessment.
Overall, the Court held that Part 36 could be used by the Claimant, with a 10% uplift awarded. After taking into account the Second Defendant’s wins, the Claimant was awarded 95% of his costs, with Indemnity Basis applying from 13th October 2012. The Claimant was also awarded its costs in relation to applications for disclosure against the Second Defendant’s accountancy expert, and an interim payment of £1.7 million.
14.06.2013Elvanite Full Circle Ltd. v Amec Earth & Environmental (UK) Ltd.  EWHC 1643 (TCC)
Key areas: costs budgets; Basis of assessment; High Court
This was a claim for the Defendant’s costs resulting from a successful defence and counter-claim for £4,630.62.
The parties had submitted costs budgets under the TCC Pilot Scheme: the Claimant for £317,333.25 and the Defendant’s of £264,708. The Claimant’s budget included the claim for an ATE premium that indemnified them for up to £250,000.
One month before the trial, the Defendant provided an updated budget of £531,946.18. The Claimant objected to it, but increased its own budget to £372,179.53. Neither party applied to increase the budgets.
On 19th February the Defendant offered to settle the claim for £150,000 including costs, which was rejected.
Given the rejection, the Defendant applied for Indemnity Basis costs. This was rejected because the Court considered that the Claimant’s matters were arguable, and because their conduct was not disproportionate. Therefore, costs were awarded on the Standard Basis.
The Court then turned to the issue over the Defendant exceeding its budget.
The Defendant submitted that they did not have to do anything other than serve an updated budget. The Claimant submitted that an application was required, which would then need to be approved. The Court agreed with the Claimant, and stated that it would suffer greater prejudice should the budget be updated after trial, given the difference between its ATE policy and the total costs. it also held that there was no “good reason” for departing from the budget.
The Court did award the Defendant £250,000 on account of costs.
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