The parties had disputed ownership of intellectual property rights. The court had found certain parties dishonest. The judge had found the successful defendants honest and adjusted the costs order in their favour. The claimants appealed.
Held: If dishonesty had been found, the fact that the paying party had not sought an order from the judge reflecting the misconduct, should not deprive that party of the right of referring to the finding, on the assessment, when considering whether the costs incurred by the dishonest party were reasonable. At the same time the judge making such a finding should express in his judgment whether and what adjustment he had made. This would avoid any risk of double jeopardy.
Waller LJ said: ‘What then is the position if a paying party has a finding of dishonesty of the winning party in his favour, and raises that factor as a ground for a reduction of the costs at the end of the trial? Clearly there is no problem if the judge’s order makes ‘no order as to costs’, but if the judge orders a reduction by say 20% without more, what would be the natural construction of that order? My view is that the natural construction of such an order, unless the contrary is expressly stated, is that the party guilty of dishonesty should not be entitled to say on assessment, ‘my costs incurred in seeking to make a dishonest case can be taken as reasonably incurred because the judge has made a reduction’. If the dishonest party was entitled to succeed on such an argument, he will hardly suffer any penalty at all.
It seems to me that a consideration of a party’s conduct should normally take place both at the stage when the judge is considering what order for costs he should make, and then during assessment. But the court will want to ensure that dishonesty is penalised but that the party is not placed in double jeopardy. Ultimately, the question is one of the proper construction of the order made by the judge.’
Judges:
Lord Justice Waller and Lord Justice Jacob
Citations:
[2006] EWCA Civ 1660, Times 08-Jan-2007
Links:
Jurisdiction:
England and Wales
Citing:
Cited – Aaron v Shelton 2004
A party wishing to raise a matter concerning the conduct of the opposing party, either before or during litigation, was under a duty to raise it before the judge making the costs order, was too broadly stated. . .
Cited by:
Cited – Business Environment Bow Lane Ltd v Deanwater Estates Ltd ChD 31-Jul-2009
The court was asked ‘Where a claimant has picked up one or more costs orders in its favour on the way to a trial, but fails very badly at the trial (for example due to exaggeration), can the costs judge assess those costs at nil on the footing that . .
Cited – Drew v Whitbread CA 9-Feb-2010
The personal injury claimant sought to raise on taxation, matters not put to the trial judge when making the costs order. The personal injuries case had been allocated to the multi-track. The judge at trial had awarded costs on the standard basis, . .
Lists of cited by and citing cases may be incomplete.
Costs
Updated: 08 July 2022; Ref: scu.246803