GENIUS SPORTS TECHNOLOGIES LIMITED & Ors v SOFT CONSTRUCT (MALTA) LIMITED & Ors

Where a party amends a pleading, the general rule is that it pays the costs of and occasioned by the amendments. Accretions commonly require a consequential response; deletions generally do not. There is no general rule requiring the amending party to pay all costs incurred in considering points later deleted. Such orders remain exceptional because identifying costs attributable to abandoned points is cumbersome and usually unjust.

Where an application becomes substantially ineffective and its likely outcome cannot readily be assessed, the appropriate order will often be costs in the case. The court should not attempt to predict the outcome of a complex application without proper determination.

The claimants applied for costs against the first and third defendants following the abandonment and substantial reformulation of a competition law defence. The claimants had issued a strike-out and summary judgment application, but the defendants later proposed a substantially amended defence. The application consequently did not proceed.

The claimants sought the costs incurred in considering the original defence and the strike-out application. The defendants contended that the relevant costs should be costs in the case. The court also considered a separate application concerning the dispensation of costs budgeting, but this judgment principally determined the costs consequences of the ineffective strike-out application.

1. The Costs Application was dismissed. The claimants were not entitled, merely because the defendants had deleted or reformulated parts of their defence, to recover all costs incurred in considering the earlier pleading and pursuing the strike-out application.
2. The general rule is that, where amendments are permitted, the amending party pays the costs of and occasioned by the amendments. Amendments may comprise deletions or accretions. Accretions will generally require a response, whose costs are ordinarily recoverable; deletions generally require no response.
3. There is no general rule that deletion of pleaded points requires the amending party to pay all costs incurred by the other parties in considering those points. The court possesses jurisdiction to make such an order in an appropriate case, but such cases are rare. Parties are entitled to one opportunity to articulate their case, with costs ordinarily dealt with at the conclusion of the action through the available costs-management and issues-based mechanisms.
4. The court agreed with the reasoning in Kompaktwerk GmbH v Liveperson Netherland [2019] EWHC 1762 (Comm). Requiring payment of both the costs of the original pleading and the amended pleading would generally be inappropriate where the costs of and occasioned by the amendments adequately compensate the affected party.
5. For a substantially ineffective application, the court should not predict the result where that result would require a busy judge to undertake lengthy and serious reflection. In such circumstances, costs in the case may be the appropriate order, consistent with BCT Software Solutions Limited v C Brewer & Sons Ltd [2003] EWCA Civ 939 and Promar International Limited v Clarke [2006] EWCA Civ 332.
6. Although party conduct may justify a different costs order even where the outcome cannot be predicted, that argument had not been advanced on the application and the court made no determination on it.

Not an appeal. The judgment determined applications at first instance.