Plus Group Ltd & Ors v Pyke

In exercising its discretion on costs, the court may adopt a broad-brush approach where several parties and issues are involved. It may make a single order without distinguishing between claimants, and should disregard the particular financial position of an individual claimant. A settlement offer with the protective effect of a Calderbank letter remains material when revisiting costs below after an appeal. The court may also consider litigation conduct, while avoiding artificial precision in allocating costs.

Four claimant companies appealed against findings made by His Honour Judge Levy QC in proceedings involving claims for breach of fiduciary duty and a counterclaim by the defendant. The claimants had failed on their claims and had been ordered to pay 85 per cent of the defendant’s costs below. On appeal, the counterclaim succeeded only against two claimants, with the allocation of the principal adjusted, and was dismissed against the other two.

The challenges to factual findings and to the adequacy of the judge’s reasons failed. The court therefore had to determine the appropriate costs of the appeal and whether the costs order below should be revisited, including the effect of a Calderbank offer and the separate financial circumstances of the claimant companies.

1. Appeal dismissed. The claimants were ordered to pay 80 per cent of the defendant’s costs of the appeal, summarily assessed at £25,000 inclusive of VAT. The order below, requiring each claimant to pay 85 per cent of the defendant’s costs subject to detailed assessment, stood.

2. The court exercised its costs discretion under the Civil Procedure Rules 1998, r 44.3. In a case involving several claimants, different issues and mixed success, a broad-brush order was appropriate. The court should not distinguish between the claimants merely because their financial circumstances differed or because one claimant had been released from liability on the counterclaim.

3. The defendant’s offer of 1 December 1998 had the protective effect of a Calderbank letter under the pre-CPR regime. The court gave it full weight when determining the costs consequences of the unsuccessful substantive claim. The claimants’ later offer, made in November 2000, had no effect on the subsequent events.

4. When revisiting the costs below, the court also took account of the view formed of Mr Plank’s conduct. It rejected an artificial allocation by reference to individual claimants and left the 85 per cent order intact. The court declined to reduce that order by relying on the defendant’s alleged dishonesty, evasiveness or expensive conduct of the litigation.

• Court of Appeal (Civil Division): [2002] EWCA Civ 1055. Appeal refused. The costs order below stood, subject to the directions on appeal costs.
• Central London County Court: His Honour Judge Levy QC awarded the defendant just over £115,000 on the counterclaim and ordered each claimant to pay 85 per cent of his costs below.