Summary of Recent Cases – Costs

A C was awarded his costs in full where he had recovered more than the amount offered by the D. Even though he had exaggerated his claim, his conduct was not in the circumstances, such as to justify a departure from the general rule that the unsuccessful party should pay the costs of the action. 

Trevor Michael Fox v Foundation Piling Ltd, CA, 07/07/11

Where one party made a Pt36 offer and then achieved a more advantageous result than that which he had proposed, the provisions of r.36.14 modified the court’s general discretion in respect of costs. Parties were entitled to make Calderbank offers outside the Pt36 framework. Where a party made such an offer and then achieved a more advantageous result, the court’s discretion was wider, though it might well be appropriate to order the party rejecting the Calderbank offer to pay all the costs since the date of its expiry. Where the C recovered more than the D had offered to pay, but less than he had previously offered to accept, he was normally to be regarded as the successful party within the meaning of r.44.3(2) and the starting point was that he should recover his costs. The next stage was to consider whether any adjustment was required to reflect the costs referable to an issue on which the successful party had lost, or to compensate the unsuccessful party for costs it had incurred by reason of the successful party’s unreasonable conduct. In a PI action the fact that the C had won on some issues but lost on others was not normally a reason for depriving him of part of his costs. Moreover, even the fact that he had deliberately exaggerated his claim might not, in certain circumstances, be a reason for depriving him of his costs. In the instant case there was no justification for departing from the normal rule under r.44.3(2). If the D failed to make a sufficient offer at the first opportunity he could not expect costs protection, although different considerations might apply where the C had been proved to have been dishonest.

Where the parties had reached agreement in relation to costs following disposal of the claim, the Court determined that the offer which had been accepted was a Part 36 Offer. Since this offer was better for the D than the offer originally made, the Court upheld the trial judge’s decision to make no order as to costs between the expiry of the relevant period for accepting the offer and acceptance. 

(1) Paul Jonathan Howell (2) Alison Ruth Robinson (3) John Neal Thompson (Trustees of The Captain Edward Joicey 1948 Settlement & The Major John Joicey 1968 Settlement) v Marcus Lees-Millais & 5 others, CA, 06/07/11

The offer in the instant case was indistinguishable from the offer in C v D (2011) EWCA Civ 646, (2011) 23 EG 86 (CS). The letter containing the offer should be treated as a Part 36 offer and the justness of that conclusion was supported by the fact that all parties treated the offers as having been made under Part 36 and said in terms that those offers were still in force well after the expiry of the 21-day period. The overriding objective and common sense suggested that in those circumstances an offer, which was expressed to be a Part 36 offer and which otherwise appeared to comply with Part 36, had to be given substantially the same effect as a Part 36 offer.

August 27, 2011 · Editorial Team · Comments Closed
Posted in: Cases