Zaza Okuashvili & Ors v Bidzina Ivanishvili & Ors

Under CPR 44.2, the unsuccessful party ordinarily pays the successful party’s costs. A party’s failure on individual issues does not justify an issue-based order unless the issue is discrete, materially increased costs, or was unreasonably pursued. The court must stand back and assess the overall justice of the case.

Indemnity costs require conduct or circumstances outside the norm. Serious non-disclosure may justify that order, but negligent or incompetent presentation without deliberate or seriously culpable conduct may not. On an application to stay payment on account pending an appeal, the court should disregard prospects of success and balance the risk of irremediable prejudice to each side.

This was a consequentials hearing following the judgment in Okuashvili & Ors v Ivanishvili & Ors [2025] EWHC 829 (Ch). The court determined responsibility for costs in two related claims, the appropriate basis of assessment, payments on account, interest, and applications for a stay pending an application for permission to appeal.

Most defendants had succeeded in setting aside service. Mr Kipiani’s applications had failed, although the surviving claims against him were narrower. The central issues were whether costs should depart from the general rule, whether indemnity costs were justified, and whether payment on account should be stayed because enforcement might be difficult if an appeal succeeded.

1. The court applied CPR 44.2. The defendants other than Mr Kipiani were the successful parties in the relevant applications. The claimants were successful against Mr Kipiani, subject to the limited surviving issues.

2. An issue-based costs order was refused in relation to the defendants other than Mr Kipiani. The issues were not discrete, generated no separately identifiable costs, and arose from overlapping alleged facts and causes of action. Success on some points did not displace the overall result. Mr Kipiani was ordered to pay the claimants’ costs of claim 1 from 8 September 2023, but there was no order for costs before that date or in claim 2.

3. The court treated the guidance summarised in Pigot v Environment Agency [2020] EWHC 144, as supplemented by Kastor Navigation v AGF MAT, as non-mechanistic guidance. The court must consider whether an issue was merely another argument supporting the principal claim and must stand back to assess the overall justice of the case.

4. Indemnity costs were refused against the claimants except for the TBC defendants after the expiry of their offer. Although the court had criticised the application for service out and found that it failed fairly to present the merits, it had not found deliberate non-disclosure or serious culpability. The claims were technically unsuccessful on jurisdiction and limitation, but were not so speculative or weak that they should never have been brought. The TBC defendants obtained indemnity costs from 10 July 2023.

5. Payments on account were fixed cautiously, generally at 50%, at 60% for Mr Partskhaladze and at 60% for the TBC defendants because of their partial indemnity order. Interest was ordered at 1% above base rate from payment to the relevant solicitors until the order.

6. For the stay applications, the court disregarded prospects of success and balanced the risk of irremediable prejudice. A real risk that sums paid to Georgian resident defendants might not be recoverable justified stays in the specified cases, subject to exceptions and an undertaking concerning TBC UK. No stay was granted for Mr Chubini, who was resident in Kenya and had not been shown to require equivalent treatment.

This was a first-instance consequentials hearing following the court’s earlier judgment in Okuashvili & Ors v Ivanishvili & Ors [2025] EWHC 829 (Ch). The judgment also addressed proposed applications for permission to appeal and stays pending appeal.