Morrow v Shrewsbury Rugby Union Football Club Ltd

Costs ordinarily follow the event, even where a successful claimant fails on substantial issues. The court may depart from that rule where the claimant’s conduct caused unnecessary costs, including through an exaggerated claim. The assessment is fact-sensitive and focuses on causation, not merely the difference between the sum claimed and the sum recovered. Exaggeration without dishonesty will not ordinarily justify a punitive costs order, but sustained and structurally embedded exaggeration across the evidence may justify a proportionate deduction. The availability of a Civil Procedure Rules 1998 Part 36 offer is relevant, but does not remove the court’s discretion under rule 44.2.

The claimant succeeded in a personal injury claim arising from an accident at the defendant’s rugby ground. Liability was admitted. Following the court’s earlier judgment on causation and quantum, the parties agreed the damages at £285,658.08. The claimant had claimed more than £1 million and had made a Civil Procedure Rules 1998 Part 36 offer to accept £800,000. The defendant had made an earlier offer of £110,000.

The remaining issue was costs. The defendant argued that the claimant had exaggerated his pre- and post-accident condition and his future loss of earnings, causing unnecessary expenditure. The claimant accepted that he had lost on parts of the claim but argued that he remained the successful party and had beaten the defendant’s offer. The court had to decide whether to depart from the general rule and, if so, the appropriate deduction.

1. The claimant was the successful party and was entitled to an order for costs in his favour. The starting point was that costs follow the event under rule 44.2 of the Civil Procedure Rules 1998. The court nevertheless retained a broad discretion to make a different order, having regard to the parties’ conduct, partial success and admissible settlement offers.

2. The claimant had presented an exaggerated claim for future loss of earnings. The exaggeration was not confined to an inaccurate witness statement or isolated oral evidence. It was embedded across the structure of the claim, including the evidence of several witnesses and the instructions given to experts. It prolonged the trial and cross-examination and therefore caused unnecessary costs.

3. The court applied the causation approach identified in Widlake v BAA Ltd [2009] EWCA Civ 1256. The relevant question was the extent to which the conduct caused costs to be incurred or wasted. The defendant also bore responsibility for the length of the trial because it contested nearly every issue relating to quantum.

4. The claimant was not dishonest. Consistently with Widlake v BAA Ltd and the caution against punitive costs sanctions for ordinary litigation lies or exaggeration, the conduct did not independently warrant a punitive order. It nevertheless justified a compensatory reduction because it caused additional expense.

5. The claimant’s Part 36 offer and the defendant’s offer were relevant circumstances. The defendant’s offer was closer to the damages awarded, but it was still too low and the defendant had lost on causation. The availability of Part 36 protection did not prevent a reduction under rule 44.2.

6. The deduction had to be an overall, proportionate judgment rather than a mathematical allocation of costs. Welsh v Walsall Healthcare NHS Trust [2018] EWHC 2491 (QB) did not establish a benchmark. In the context of the seven-day trial and numerous witnesses, a 15% deduction was appropriate. The defendant was ordered to pay 85% of the claimant’s costs, subject to detailed assessment if not agreed.