Milanese v Leyton Orient Football Club Ltd (Rev 1)

In costs proceedings involving several distinct claims, the court should identify the successful party separately on each substantial aspect before deciding whether any overall adjustment is justified. A modest recovery does not automatically make a claimant the overall winner. The court may distinguish conceptually and temporally separate claims, particularly where success on one claim does not establish success on another. Under Civil Procedure Rules 1998, rule 44.2, all the circumstances, including partial success, conduct and offers, must be weighed. Where a counterclaim increased costs only to a limited extent, the costs principle in Medway Oil and Storage Co Ltd v Continental Contractors Ltd remains applicable.

The claimant brought wrongful dismissal and contractual claims against the defendant, which also advanced a counterclaim. In the substantive judgment handed down on the same day, the wrongful dismissal claim was dismissed, the counterclaim was dismissed, and the claimant recovered approximately £8,300 on the contract claim for salary and expenses.

Both parties sought costs. The central issues were which party had succeeded on each aspect, whether the results should be aggregated, how partial success and conduct should affect the costs of the wrongful dismissal claim, and how the counterclaim and contract claim should be treated.

1. Outcome. The claimant was the successful party on the counterclaim and contract claim. The defendant was the successful party on the wrongful dismissal claim, which was the principal and most substantial issue.
2. Separate aspects. The court rejected aggregation of the litigation into a single overall result. The contract claim concerned accrued salary and expenses during the contract, whereas the wrongful dismissal claim concerned losses after termination. Success on the contract claim did not amount to success on the wrongful dismissal claim or the action overall.
3. Adjustment. Applying rule 44.2 of the Civil Procedure Rules 1998, the court considered partial success, the defendant’s failure on five of its six grounds, the limited clarity and timing of its explanation of the dismissal grounds, its early offer, and the claimant’s false evidence. The defendant was awarded 67% of its reasonable costs of the wrongful dismissal claim.
4. Counterclaim and contract claim. The claimant was awarded the reasonable costs of both claims on the standard basis. Those costs were to be offset against the defendant’s costs award. Applying Medway Oil and Storage Co Ltd v Continental Contractors Ltd, only additional costs exclusively attributable to the counterclaim were recoverable under that costs order; common costs were not to be apportioned.
5. The costs were subject to detailed assessment if not agreed.

The judgment records the substantive judgment in the same litigation, but does not state any appellate history.