Summary

In the light of the special features of the instant case, despite being identified as the "winner" the claimant would be entitled to only 75 per cent of its costs.

Facts

The court had to determine the costs of an action in which the application of the claimant company (T) for an injunction to prevent interference with right to light by the defendant company (F) had been refused, although damages in lieu of injunction had been awarded. It was accepted by F that it had to pay T's costs of the assessment of damages but a dispute arose in relation to the costs before and during the trial on the merits. T contended that, as it was the "winner", having been awarded damages of £50,000, and that, as F had failed to accept T's Part 36 offer, which had expired just before trial and T had "beaten" in respect of damages, T was entitled to its costs on the indemnity basis. F contended that T should not be regarded as the winner where the proceedings had concerned rights to light to different sets of windows and where T had succeeded on one head but had lost or abandoned its claim on the others, and had pressed throughout for an injunction that would have involved demolition of part of F's building.

Held

The correct starting point on the question of costs was to identify the "winner", since the winner should not lightly be deprived of his costs, AL Barnes Ltd v Time Talk (UK) Ltd (2003) EWCA Civ 402, (2003) BLR 331 applied. In deciding who was the successful party the most important thing was to identify the party who was to pay money to the other, Day v Day (Costs) (2006) EWCA Civ 415, (2006) CP Rep 35 applied. In the instant case, on that basis, T had to be identified as the "winner" because F had to pay T damages of £50,000. Having identified T as the "winner" and the general rule being that F had to pay T's costs, the court had then to consider whether to exercise its discretion under CPR r.44.3(1) to make some other order. In particular, CPR r.44.3(5)(b) was relevant. It concerned whether it was reasonable for a party to raise, pursue or contest a particular allegation or issue. In the instant case there were a number of special features including that (a) the key evidence that had led T to succeed had only appeared in the oral evidence at trial, and before that F could reasonably have thought that it was going to succeed on all the issues; (b) F had succeeded on all points argued except the infringement of the right to light of one set of windows; (c) T had pressed for an injunction before and throughout the trial, and that conduct had made the trial longer and more complex. In those circumstances, T's Part 36 offer had to be given less weight than would normally be the case. In the light of the very special features of the instant case, although T had to have most of its costs despite having lost most of the arguments and despite having pursued relief that would have been oppressive to grant, it should not have all its costs and should not have any of them on the indemnity basis as it sought. Justice would, accordingly, be done if T were to receive 75 per cent of its costs up to and including the trial and handing down of judgment on the merits. T would have the whole of its costs in relation to the assessment.

Costs determined

Chancery Division
Gabriel Moss QC

References
​LTL 22/3/2007