Partial Success

SOME YOU WIN SOME YOU LOSE | PARTIAL SUCCESS AND THE COURTS’ APPROACH TO COSTS

Following trial of a dispute about covenants in contracts, under which the claimant sought payment from the defendant, the Judge declared that on a true interpretation of the covenants no liability for payment had yet arisen.

In addition to the “interpretation issue” the defendants also run a series of other defences, including fraudulent misrepresentation, conspiracy, estoppel, title to sue, and allegations that the original sales had been part of an unauthorised collective investment scheme.

These other defences failed.

Pyrrhic victory

You recovered 2% of your claim. Did you win?

So, you’ve recovered £700,000. But you were claiming £38m. Who really won?

Sir Antony Edwards-Stuart found that the claimant’s recovery in this case whilst “not, of itself, nominal … was a tiny fraction (about 2%) of the sum claimed” and amounted to, at best, a pyrrhic victory. Following an examination of various authorities on the subject of identifying the true winner in cases where the claimant has recovered a small fraction of the amount sought, he determined that the defendant should pay just 20% of the claimant’s costs.

Issues-Based Costs Orders And The Powers Of A Trial Judge Under CPR Part 36

Part 36 did not preclude a judge from making an issue-based or proportionate costs order where a claimant had only succeeded on some issues. However, the constraints of Part 36 meant that it would be reasonable to deprive a claimant all or part of their costs only if it would be unjust to order otherwise, having regard to “all the circumstances of the case”