Clare Alison Laird v Catherine Anne Lowder Simcock & Ors.

Standard-basis assessment is the usual costs order. Indemnity costs require conduct or circumstances taking the case out of the norm, assessed by reference to the conduct of the claim rather than the underlying events giving rise to it. In an unopposed claim for rectification of a trust document, beneficiaries and a necessary trustee or executor will normally be entitled to indemnity costs. A payment on account must be a reasonable estimate of the sum likely to be recovered. Disproportionate or excessive costs may justify ordering a lower proportion, even where an appeal is pending, particularly where the appeal is unopposed and does not realistically threaten the costs order.

The judgment determined three outstanding costs issues following earlier judgments in the same rectification claim. The claimant, acting as executor and trustee, had unsuccessfully sought rectification of a trust document. The claim was unopposed by the first defendant, who was also a trustee, executor and beneficiary, and the other defendants, who were beneficiaries.

The issues were the basis on which costs should be assessed, the amount of any payment on account, and whether the first defendant could recover from the estate any costs not recovered from the claimant.

1. Basis of assessment. The usual order is assessment on the standard basis. The test for indemnity costs is whether conduct or circumstances take the case out of the norm. Applied in the context of CPR 44.2(4) and (5), that inquiry concerns the conduct of the claim, including compliance with relevant pre-action protocols. Conduct in the events giving rise to the claim, including conduct as executor or trustee, is not relevant to the basis of assessment.
2. The criticisms of the claimant’s conduct of the litigation, including inadequate and initially inaccurate evidence, did not individually or cumulatively take the case sufficiently out of the norm. However, because the claim was an unopposed claim for rectification of a trust document, the first defendant and the beneficiary defendants were entitled to indemnity costs in their respective capacities. Such a claim is not in its nature hostile litigation.
3. Payments on account. Under CPR 44.2(8), a reasonable sum on account is an estimate of what the receiving party is likely to recover. The pending appeal did not provide a realistic reason to withhold an order because both the claim and appeal were unopposed, and there was no appeal against the relevant costs order.
4. The claimed costs were apparently disproportionate and excessive without further explanation. The claimant was therefore ordered to pay 40% of the first defendant’s claimed costs, £43,596.48, and 50% of the daughters’ claimed costs, £45,833.
5. The first defendant had no jurisdictional or principled basis for recovering from the estate a fuller indemnity for costs not recovered from the claimant, particularly in view of the criticisms of the level of costs.

First-instance costs determination following earlier judgments in the same proceedings. The judgment records that permission to appeal the order dismissing the substantive claim had been obtained, but no appeal lay against the costs order of 4 October 2022.