International Game Technology PLC & Ors v The Gambling Commission

A payment on account of costs should normally be based on a broad estimate of the likely recovery, subject to an appropriate margin for error. An interested party does not recover costs automatically merely because it participated in proceedings or succeeded in the underlying bid. Recovery is more likely where the party had a separate issue or interest requiring separate representation, was permitted to participate actively, and the case had unusual features such as exceptional importance, scale or complexity. Permission to appeal may be refused where the proposed appeal has no real prospect of success and no sufficiently compelling additional reason.

The claimants challenged the Commission’s award of the Fourth National Lottery licence to Allwyn. In an earlier judgment, the court decided that the claimants lacked standing and resolved the Preliminary Issue in favour of the Commission. This consequential judgment addressed costs, including the Commission’s application for a payment on account, Allwyn’s claim for its costs as an interested party, and the claimants’ application for permission to appeal.

The central questions were the proper amount of an interim costs payment, whether Allwyn’s separate participation justified a costs order, and whether any proposed appeal met the requirements of CPR 52.6(1)(b).

The court entered judgment for the Commission on the Preliminary Issue and dismissed both claims.

1. Commission’s costs. A payment on account is necessarily a rough and ready estimate because detailed assessment has not occurred. The court should identify a reasonable sum representing the likely level of recovery, allowing an appropriate margin for error. Relevant considerations may include the proportion likely to be recovered, recovery difficulties, the prospects of appeal and the parties’ means. A payment of £2.1 million was ordered, payable by 4pm on 13 September 2023.
2. Allwyn’s costs. The principles in Bolton Metropolitan District Council and their subsequent application to procurement challenges required consideration of whether there was a separate issue or an interest requiring separate representation. Interested-party status and participation do not, by themselves, create an entitlement to costs. However, Allwyn had distinct interests, had been granted permission to participate fully, and had made separate submissions. The unusual importance, scale and complexity of the procurement challenge also supported a costs order.
3. Allwyn was entitled to its costs of the claims, including the Preliminary Issue. Its participation complied with the case-management order and its oral submissions did not duplicate the Commission’s case. Some duplication in written submissions did not justify a deduction.
4. Permission to appeal. The proposed grounds had no real prospect of success. The claimed importance of standing in procurement proceedings did not constitute some other compelling reason under CPR 52.6(1)(b), particularly where the proposed appeal was considered untenable and would consume substantial court resources. Permission to appeal was refused.

The judgment itself records the earlier decision on the Preliminary Issue, reported as [2023] EWHC 1961 (TCC). The claims were dismissed and permission to appeal was refused in this consequential judgment.