Monex Europe Ltd v Pothecary & Anor

On summary assessment, proportionality cannot be determined simply by comparing the receiving party’s costs with the paying party’s costs. The court must examine the specific items claimed and assess whether the costs bear a reasonable relationship to the matters identified in Civil Procedure Rules 1998, CPR Part 44.3(5). Relevant considerations include the sums and non-monetary relief in issue, complexity, additional work generated by the paying party and wider factors. Duplication of work between defendants with substantially similar defences and evidence may justify reductions.

Following refusal of Monex Europe Limited’s application for an injunction against Charles Pothecary and Guy Kaufman, the Deputy High Court Judge directed summary assessment of the defendants’ costs. The defendants claimed £85,446. Monex argued that the sum was unreasonably high by comparison with its own costs of £44,669, and challenged the hourly rates and time claimed for particular work.

The defendants resisted a global comparison and relied on the matters identified in CPR Part 44.3(5), including the importance, complexity and factual burden of the application. The central issue was how the defendants’ costs should be assessed on the standard basis.

1. Applicable approach. The assessment was on the standard, rather than indemnity, basis. Under CPR Part 44.3(2), only costs proportionate to the matters in issue could be allowed. Applying CPR Part 44.3(5), costs were proportionate where they bore a reasonable relationship to the relevant considerations. A simple comparison between the parties’ overall costs was inappropriate. The court had to examine the specific items claimed.
2. Application. The proceedings were important to both defendants, who were entitled to proper representation and to advance their best defences. Their defences and factual evidence were, however, essentially the same. The resulting duplication between fee earners working on separate witness statements made recovery of all the associated costs disproportionate. Reductions were also justified for excessive time spent on Mr Kaufman’s statement, partner attendance on the parties, work on Nick Fullerton’s statement, and drafting and finalising the order.
3. The use of an experienced costs lawyer to prepare the schedule was not disproportionate. Counsel’s post-hearing costs were allowed because additional work was required and was not included in the brief fee.
4. The defendants’ costs were reduced by £11,405. Following summary assessment, Monex was ordered to pay the defendants £74,041.

First-instance summary assessment following refusal of Monex’s injunction application. No lower-court decision or appeal is stated in the judgment.