Carr v Bemrose & Anor

On an appeal against a costs order, the Court of Appeal may intervene only where the lower court erred in principle, considered irrelevant matters, omitted relevant matters, or reached a decision that was wholly wrong because the factors were not fairly balanced.

Under Civil Procedure Rules 1998, Part 44, the general rule that costs follow the event is only a starting point. The court may make a different order after considering all the circumstances, including the parties’ conduct, the extent of success and settlement offers. A successful party is not necessarily the party who obtained some practical benefit; the court must examine the relief actually sought and obtained.

Mr Carr brought proceedings against his neighbours concerning alleged interference with an easement of drainage caused by a conservatory. The District Judge dismissed the claim but ordered no costs before 13 January 1999 and required Mr Carr to pay the defendants’ costs thereafter.

His appeal to the county court was dismissed. The Court of Appeal granted limited permission to appeal on the costs issues, including whether the District Judge had erred in principle by taking account of the defendants’ settlement offer and by making no order as to costs before 13 January 1999.

The central questions were whether the costs discretion had been lawfully exercised and whether there was any proper basis for appellate interference.

1. Appeal dismissed. The District Judge’s costs order was a correct exercise of discretion, and the county court judge had been right to dismiss the earlier appeal.
2. The Court of Appeal adopted the conventional approach stated in AEI Rediffusion Music Ltd v Phonographic Performance Ltd [1999] 1 WLR 1507, approving the formulation from Roache v News Group Newspapers Ltd [1998] EMLR 161. Intervention requires an error of principle, failure to take account of a relevant matter, consideration of an irrelevant matter, or a decision that is wholly wrong because the factors were not fairly balanced.
3. The District Judge was entitled to apply Part 44 of the Civil Procedure Rules 1998. Part 44.3(2)(a) establishes that the unsuccessful party will generally pay the successful party’s costs, but that rule is a starting point rather than an inflexible conclusion.
4. For the purposes of the general rule, Mr Carr was unsuccessful because he did not obtain the injunction sought, either in its original or proposed amended form. The fact that the proceedings produced practical improvements did not make him the successful party.
5. Under Part 44.4, the court was entitled to consider all the circumstances, including the conduct of the parties, the outcome, the extent of success and offers to settle. The District Judge properly considered those matters and was entitled to make no order as to costs before 13 January 1999, while ordering Mr Carr to pay the defendants’ costs thereafter.
6. The respondents’ application for indemnity costs of the appeal was refused. The appeal costs were ordered to be subject to detailed assessment.

• Court of Appeal (Civil Division): Appeal dismissed. The court upheld the costs order made below and refused indemnity costs.
• Bridgwater County Court: His Honour Judge O’Malley dismissed Mr Carr’s appeal from the District Judge’s costs order.
• District Judge: The substantive claim was dismissed. No order was made as to costs before 13 January 1999, and Mr Carr was ordered to pay the defendants’ costs thereafter.