Tamares (Vincent Square) Ltd v Fairpoint Properties (Vincent Square) Ltd

In commercial litigation, the starting point for costs is to identify the successful party. The clearest indication is ordinarily the party who must pay money to the other. The unsuccessful party will generally pay the successful party’s costs, but the court retains a broad discretion to make a different order.

In exercising that discretion, the court must have regard to the parties’ conduct, partial success, and payments into court or admissible settlement offers. It may also consider whether it was reasonable to pursue particular allegations or relief. A successful claimant may therefore recover most, but not all, of its costs where it pursued disproportionate or oppressive relief.

The claimant brought proceedings concerning interference with rights to light. It established an actionable infringement in relation to the basement stairs windows and obtained damages of £50,000 in lieu of an injunction. It failed on most other issues, including its claim concerning entrance lobby windows and its contention that an injunction should be granted.

The court had already determined liability and damages. This judgment concerned costs. The defendant argued that the claimant should receive little or none of its costs because it had lost most arguments and had pursued an injunction which would have been oppressive to grant. The central issue was the proper application of the costs discretion.

1. The claimant was the winner because the defendant had to pay it £50,000 plus interest. The court treated that as the proper starting point, applying the approach in AL Barnes Ltd v Time Talk (UK) Ltd [2003] EWCA Civ 402 and Day v Day [2006] EWCA Civ 415.

2. The general rule under CPR 44.3(2)(a) was that the unsuccessful party should pay the successful party’s costs. The court retained a discretion under CPR 44.3(1) and CPR 44.3(2)(b) to make a different order.

3. Under CPR 44.3(4), the court had to consider the parties’ conduct, whether a party had succeeded on part of its case, and any payment into court or admissible offer. Under CPR 44.3(5)(b), relevant conduct included whether it was reasonable to raise, pursue or contest a particular allegation or issue.

4. The claimant had reasonably needed to litigate to vindicate its right, and the defendant had not accepted the relevant offers. Nevertheless, pursuing an injunction which would have been oppressive to grant made the trial longer and more complex. The claimant had also lost most of the substantive arguments.

5. The appropriate order was that the claimant recover 75% of its costs up to and including the trial and the handing down of judgment on the merits. It recovered all costs of the assessment. Costs were to be assessed on the standard basis unless agreed. The judge expressed provisional views on interest and an interim costs payment, subject to further argument.