Jeeg Global Ltd v Hare

Where proceedings are brought to obtain an injunction or specific performance, achieving the practical objective does not necessarily make the opposing party the unsuccessful party for costs purposes. If the court cannot determine which party would have succeeded at trial, it may decline to allocate the action’s costs under the general rule.

The court may make a costs order reflecting party conduct under CPR Part 44.3 without finding that the conduct caused additional costs. It may also stay proceedings of its own motion where a permanent undertaking gives the claimant all that a trial could achieve and continuing the action would be disproportionate.

The claimant brought proceedings seeking injunctive relief against the defendant. The court had previously refused the defendant’s application to strike out the claim as an abuse of process: [2012] EWHC 773 (QB).

The defendant offered a permanent undertaking in terms equivalent to the interim undertaking already in place. The court considered whether to accept that undertaking, stay the action, and determine the costs of the action, including the claimant’s conduct in obtaining an injunction without notice.

The central issues were whether the claimant was the successful party for the purposes of CPR Part 44.3, whether costs should reflect the without-notice application, and whether a trial concerning the remaining costs would be proportionate.

1. The court accepted the defendant’s permanent undertaking and stayed the action under CPR Part 3.1(2)(f). The undertaking gave the claimant all that it could obtain by succeeding at trial. A further trial to determine responsibility for the remaining costs would be wholly disproportionate.

2. The general rule under CPR Part 44.3 that the unsuccessful party pays the successful party did not require an order in favour of the claimant. Although the claimant had achieved its practical objective, the court had made no finding that the defendant was liable or that the claimant would have succeeded at trial. The claimant might ultimately have recovered nothing and might therefore have been the unsuccessful party.

3. The court could take account of party conduct under CPR Part 44.3(4) and (5)(a) without finding that the conduct caused costs which would otherwise not have been incurred. The purpose included encouraging compliance with the CPR.

4. The claimant had failed to give notice of its application for an injunction, contrary to CPR Part 25.3 and Practice Direction 25A para 3.4. The recognised exceptions were unavailable. The court therefore considered it appropriate not to require the defendant to pay the costs attributable to that conduct.

5. The defendant was ordered to pay the claimant’s costs of the defendant’s strike-out application. There was no order as to the costs of the action. The request for indemnity costs was refused because the application, although weakened by a later letter, had not become sufficiently unreasonable.

The judgment records that the court had previously refused the defendant’s strike-out application as an abuse of process in [2012] EWHC 773 (QB). This judgment determined the consequential costs issues and stayed the action.