BTI 2014 LLC v Pricewaterhousecoopers LLP & Anor

Where an interlocutory application is wholly unsuccessful, the successful party will ordinarily receive its costs of that application, even though the unsuccessful party may ultimately succeed at trial. Costs of an earlier application should not automatically be treated as costs of a later application where the grounds materially differ or have been superseded. Where costs are incurred only shortly before judgment, there may be no sufficient reason to award interest before the judgment date. An interim payment on account may be assessed conservatively where the costs appear disproportionate or unreasonable and the available evidence does not permit a precise assessment. Permission to appeal and a stay of procedural steps are matters requiring separate, case-specific assessments.

The claimant brought proceedings against PricewaterhouseCoopers LLP and Windward Prospects Limited. PWC had made an earlier application in 2015 to strike out the claim or obtain summary judgment. That application was stayed and later superseded by a further application dated 26 March 2019, which the court dismissed in judgment dated 15 November 2019.

This judgment determined the consequential matters arising from that decision: the formal disposal and costs of the 2015 Application, the costs of the 2019 Application, interest on costs, an interim payment on account, permission to appeal, and whether the requirement to serve a defence should be stayed.

1. The 2015 Application was formally dismissed. Its grounds had not been argued and had been superseded by amendments to the particulars of claim and by developments in the related litigation. Its costs were therefore ordered to be costs in the case.
2. PWC’s later Application had been wholly unsuccessful. The possibility that PWC might succeed at trial on the scope of the duty of care or another issue did not justify depriving BTI of its costs of the substantial interlocutory application. PWC was ordered to pay BTI’s costs of that Application, assessed on the standard basis if not agreed.
3. No interest on costs before the judgment date was ordered. The costs had been incurred principally in October and November 2019, and BTI had been out of pocket for only a short period while interest rates remained low.
4. An interim payment of £350,000 on account of the Application costs was ordered. Although the issues were complex, the court considered that some costs would be found disproportionate or unreasonable. In the absence of detailed evidence explaining the expenditure, a conservative figure was appropriate.
5. Permission to appeal was granted on grounds 1 and 2 and refused on ground 3. The requirement for PWC to serve a defence was stayed and the time for service was extended to two months after judgment by the Court of Appeal, or earlier withdrawal or dismissal of the appeal.

The judgment records the earlier judgment dated 15 November 2019 dismissing PWC’s application to strike out the claim or obtain summary judgment. Permission to appeal was granted on two grounds and refused on a third. The requirement to serve a defence was stayed pending the Court of Appeal’s judgment.