F J Architects Ltd v Evans Of Leeds Ltd & Ors

A trial judge’s costs decision attracts a generous ambit of discretion. The Court of Appeal should intervene only where the decision falls outside the permissible range of proper discretion. A different judge might have made a different order is insufficient. Costs must be assessed realistically rather than mechanically. Relevant considerations may include the extent of success, the disparity between the amount claimed and recovered, evidential difficulties, and a Part 36 offer.

After a trial in the Technology and Construction Court, the claimant succeeded against the fourth defendant on only two of sixteen copyright allegations and recovered £5,000. The judge made an issue-based costs order, awarding the fourth defendant 25 per cent of its total costs and requiring it to pay 37.5 per cent of the claimant’s costs attributable to the copyright claim.

The fourth defendant sought permission to appeal, arguing that the copyright costs order fell outside the judge’s discretion, particularly because of the disparity between the costs, the amount claimed and the sum recovered.

Permission to appeal refused. Lord Justice Dyson delivered the judgment, with which Lord Justice Kay agreed.

1. The judge had a generous ambit of discretion when deciding costs. The relevant question was whether the order fell outside the range of a proper exercise of that discretion.
2. The Court agreed that costs should be approached by reference to the realities of the litigation rather than mechanically. The limited success on the copyright claim, the substantial disparity between the amount claimed and the £5,000 awarded, the changes in the claimant’s expert evidence, and the claimant’s Part 36 offer were all relevant considerations.
3. The judge had expressly considered those matters and had made a substantial reduction in the claimant’s recoverable costs. There was no basis for concluding that he had failed to take account of relevant factors or had adopted a mechanistic approach.
4. The possibility that another judge might have made a greater deduction did not establish an error of principle or an order outside the permissible range. The application therefore had no real prospect of success and permission to appeal was refused.

• Court of Appeal (Civil Division): Permission to appeal from the costs order was refused.
• High Court, Technology and Construction Court: His Honour Judge Langan QC made an issue-based costs order following the trial.