The Court was tasked with determining costs following a hard fought piece of commercial litigation in which the claimant was awarded US$5,388,312.08 of a US$63.5 million claim. Mrs Justice O’Farrell considered the various authorities and relevant principles to be applied when determining whether to make an issues based or proportional costs order before determining that the defendant should pay 85% of the claimant’s costs.
This was a costs decision following determination of 23 common issues between the parties in group litigation between several hundred sub-postmasters and The Post Office. It dealt with a number of issues, including:
Whether the costs of the Common Issues should be reserved;
Who should pay the costs of the Common Issues and in what proportion;
Whether the costs be assessed on the standard or on the indemnity basis;
An application for an interim payment on account; and
Timing of the detailed assessment of the costs.
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.
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”