Global Flood Defence Systems Ltd & Anor v Johan Van Den Noort Beheer BV & Ors

For the purpose of the Intellectual Property Enterprise Court costs cap, “claim” means the single set of proceedings, rather than only those issues finally determined at a particular stage. Where part of a case is adjourned or determined separately, the court must not apply a separate overall cap to each part. Costs cannot be assessed until all issues in the proceedings have been resolved, because set-off must be considered before the overall cap is applied. The approach preserves the predictability of the costs regime and avoids procedural decisions increasing a party’s potential liability beyond the cap applicable to the proceedings as a whole.

The claimants brought proceedings concerning alleged groundless threats of patent infringement and misrepresentation. The defendants counterclaimed for royalties under a patent licence agreement. The threats issue was adjourned, while the misrepresentation claim failed and the royalty counterclaim succeeded.

The defendants sought immediate assessment of their costs on the issues already decided. The claimants argued that assessment should await determination of the threats issue. The central question was whether “claim” in CPR 45.31(1)(a) meant the proceedings as a whole or only claims finally determined at that stage.

1. The costs assessment was adjourned. The court could not assess the defendants’ costs until the outstanding threats allegation had been determined.
2. CPR 45.31(1)(a) was construed as referring to a single set of proceedings. It did not create separate £50,000 caps for separate issues or stages within one claim number.
3. That construction was required because CPR 45.31 and CPR 45.42 require set-off to be applied before the overall cap is considered. Applying the cap before all issues were resolved would prevent the court from identifying the overall winner and applying any appropriate discount or set-off.
4. The contrary construction would make the costs protection depend on procedural developments, such as preliminary issues, adjourned trials or summary judgment applications. It could expose a party to multiple caps and create incentives to seek separate determinations for financial pressure.
5. The court respectfully agreed with Liversidge v Owen Mumford Ltd ([2012] EWPCC Civ 40; [2013] F.S.R. 38), which treated “claim” in the relevant costs rule as a single set of proceedings. The observations in Destra Software Ltd v Comada (UK) LLP ([2012] EWPCC Civ 39) concerning two caps were obiter and did not justify a different result.
6. The earlier approach in BOS GmbH & Co KG v Cobra UK Automotive Products Division Ltd ([2012] EWPCC 44) confirmed the ordinary sequence: stage costs are assessed, any discount or set-off is applied, and the resulting total is subject to the overall cap.