Phillipps v Associated Newspapers Ltd.

Acceptance of a Part 36 offer or payment in libel proceedings does not ordinarily end the claimant’s entitlement to recover the costs of obtaining permission for, and making, a unilateral statement in open court. The Civil Procedure Rules 1998 did not significantly alter the established practice. Permission should ordinarily be granted for a reasonable and proportionate statement, particularly where the sum paid is more than nominal. A defendant will normally bear the related costs as part of the costs of the action. Costs caused by opposition to the statement may also be awarded against the defendant where that opposition is unsuccessful.

The claimant brought libel proceedings against the defendant. The parties settled after the defendant’s Part 36 payment was accepted. The defendant declined to participate in a joint statement, although an apology was later published, and the claimant applied under the practice direction to read a unilateral statement in open court.

By the hearing, the defendant did not oppose permission but disputed responsibility for the costs of preparing and making the statement, arguing that the costs entitlement ended when the Part 36 payment was accepted. The court therefore considered the interaction between Part 36 and the provisions governing statements in open court in libel proceedings.

1. Permission and costs. Permission was granted for the claimant to make a unilateral statement in open court. The defendant was generally liable for the costs of the formal application and of making the statement, as integral parts of the costs of the action.
2. Effect of Part 36. CPR 36.13(1), which entitled a claimant to the costs of the proceedings up to acceptance of a Part 36 offer or payment, did not stop the costs clock at acceptance in these circumstances. Paragraph 6.2 of the Practice Direction to CPR Part 53 contemplated that permission might be sought either before or after acceptance. That timing provision did not justify depriving the claimant of costs which had traditionally been recoverable.
3. Opposition and costs. The court retained discretion over the costs of the Part 23 application. Where a defendant caused a hearing by objecting to a unilateral statement and the objections failed, the defendant would normally be expected to bear those additional costs. The same principle applied even where the defendant made little or no substantive objection to the statement itself.
4. Permission as the ordinary course. Refusal of permission was exceptional. A reasonable and proportionate statement would ordinarily be permitted, especially where the payment was well above nominal. The earlier refusal in Church of Scientology v Borth News was an exceptional example involving a relatively trivial payment. The approach was consistent with Barnet v Crozier.
5. The claimant’s costs were reduced for proportionality, but not because her advisers had made moderate wording concessions. Those concessions involved no major concession of principle, and the objections were characterised as footling.