Barkhuysen v Hamilton

A successful party’s costs should reflect the overall outcome, not a mechanical count of causes of action. A proportionate reduction may be made for substantial issues on which that party failed, but issue-by-issue orders are generally undesirable.

Indemnity costs may be ordered where the facts or conduct take the litigation outside the norm. Deliberate misconduct is not required. Where a claimant obtains a judgment more advantageous than a valid Part 36 offer, the court must ordinarily order the prescribed consequences unless that would be unjust, having regard to all the circumstances and the specified factors in Civil Procedure Rules 1998, rule 36.17.

The ruling concerned consequential costs matters following the trial between Anton Barkhuysen and Sharon Patricia Hamilton. In the earlier judgment, Barkhuysen v Hamilton [2016] EWHC 2858 (QB), the claimant obtained judgment for damages for false imprisonment, slander and harassment, while claims for malicious prosecution and some alleged slanders failed. The counterclaim was dismissed and damages of £32,080 were awarded.

The court then determined the appropriate proportion and basis of costs, the consequences of the claimant’s Part 36 offer, the rate of interest, payment on account and a stay of execution.

1. Costs allocation. The claimant was the successful party. The court rejected a mechanical calculation based on the number of causes of action. The proper approach was to make a reduction reflecting the costs of issues on which the claimant failed, the defendant’s successful work on those issues, and the relative importance and actual cost of the issues. The claimant was therefore awarded 90% of the costs.
2. Indemnity basis. Costs are ordinarily assessed on the standard basis. Indemnity costs are appropriate where the facts or conduct take the case outside the norm. Deliberate misconduct is unnecessary. The defendant’s false and malicious central allegation, threats to a witness, repeated serious lies and highly unreasonable conduct justified indemnity costs.
3. Part 36. The claimant had obtained a judgment more advantageous than the valid October 2015 offer. Rule 36.17(4) therefore applied. The defendant gave no sufficient reason why the consequences would be unjust. The matters in rule 36.17(5), including the clarity and reasonableness of the offer, its timing, the available information, the parties’ conduct in providing information and whether it was a genuine attempt to settle, supported the order.
4. The defendant was ordered to pay the additional amount and interest on damages and costs. Interest was fixed at 10%, being modestly above the otherwise applicable statutory rate. A payment on account of £150,000 was ordered under rule 44.2(8), with detailed assessment and a stay of execution until 16 January 2017, subject to a further application.

The ruling followed the trial judgment in Barkhuysen v Hamilton [2016] EWHC 2858 (QB), which awarded the claimant damages and dismissed the counterclaim. This judgment determined consequential costs and enforcement matters.