Laporte & Anor v The Commissioner of Police of the Metropolis

When a successful party has refused to engage in alternative dispute resolution, the court must decide whether that refusal was unreasonable by considering all the circumstances. The burden lies on the unsuccessful party. The Halsey factors are relevant but non-exhaustive and must not be applied mechanically. Silence or inadequate engagement may be unreasonable, but it does not automatically determine the costs order. The court must conduct a broader balancing exercise. A failure to engage with ADR may justify reducing, but does not necessarily eliminate, the successful party’s costs. Indemnity costs remain exceptional, and public bodies have no general entitlement to them.

The claimants lost their substantive civil claim against the Commissioner of Police of the Metropolis. They sought an order that there be no order as to costs because the defendant had failed to engage adequately with repeated invitations to ADR. The defendant sought its costs on the indemnity basis and a payment on account.

The court considered the defendant’s failure to respond to the letter of claim, alleged defects in its costs schedules, the merits and nature of the dispute, the prospects and cost of mediation, delay, and the parties’ conduct. The central issue was whether the defendant’s refusal to engage in ADR was unreasonable and, if so, what costs consequences should follow.

1. ADR and costs. Applying Halsey v Milton Keynes General NHS Trust [2004] 1 WLR 3002, the burden was on the unsuccessful claimants to show that the successful defendant acted unreasonably in refusing ADR. The relevant considerations included the nature and merits of the dispute, previous settlement efforts, the cost of mediation, delay, and the prospects of success. They were not exhaustive and had to be considered in the round.
2. The dispute was suitable for mediation. It involved factual issues, there was no continuing commercial relationship, and a settlement could have been reached even if the defendant succeeded on the legal issues. The defendant’s own assessment of its case did not justify refusing ADR.
3. The claimants had repeatedly invited ADR and had not made a formal financial offer a precondition. Their statements about the need for compensation were tactical positioning rather than intransigence. The defendant’s failure to respond adequately, including after a court order and further invitations, was unjustified. There was a reasonable prospect that ADR would have achieved a settlement in whole or in part.
4. Under PGF II SA v OMFS Co 1 Ltd [2014] 1 WLR 1386, constructive engagement was required. The failure to engage did not produce an automatic costs penalty. It was one aspect of the wider discretionary assessment.
5. The failure to respond promptly to the letter of claim corroborated the defendant’s sustained failure to prioritise ADR, but the defects in the costs schedules did not materially affect the broader costs discretion. Indemnity costs were refused. The defendant’s adverse findings against some officers and the claimants’ reasonable procedural conduct militated against such an order, and public bodies had no general claim to indemnity costs.
6. The defendant had nevertheless succeeded on every substantive issue. The claimants were ordered to pay two-thirds of the defendant’s costs, assessed on the standard basis, together with £50,000 on account under CPR 44.2(8).

The judgment records that the substantive claim had been dismissed in [2014] EWHC 3574 (QB). No appellate decision is stated. Time for either party to file an appellant’s notice in respect of the substantive and costs judgments was extended to 12 March 2015.