William Thomas Stockler & Anor v The Corporation of the Hall of The Arts and Sciences

Proportionality of costs is assessed after a line-by-line assessment of reasonableness. The court must then assess the resulting total by reference to the statutory factors, including the monetary and non-monetary value of the proceedings, complexity, conduct, reputation and public importance. A court must give effect to existing costs orders. Indemnity costs are not subject to a further proportionality assessment. Proportionality cannot be calculated by applying arbitrary multiples to the claim’s financial value. Where a claim is allocated to a track other than the one normally indicated by its value, the resulting costs consequences may be relevant. Dismissal of inadequately particularised points of dispute does not automatically prevent a further proportionality reduction, but may be relevant to fairness in the circumstances of the individual case.

The claimants, holders of permanent seats at the Royal Albert Hall, brought proceedings concerning payments due under the defendant’s Ticket Return Scheme. The defendant obtained judgment on the construction of the contractual arrangements and later obtained judgment dismissing the balance of the claim, together with costs orders providing for standard-basis costs until 8 June 2023 and indemnity costs thereafter.

The detailed assessment resulted in £55,581.38 being allowed for the standard-basis part of the bill. The issue before the court was whether that sum should be reduced further for proportionality.

1. The application was dismissed. The reasonable costs allowed on the line-by-line assessment were not disproportionate, so no further reduction was made.
2. The court applied the approach in West and Demouilpied v Stockport NHS Foundation Trust [2019] Costs LR 1265. Proportionality is considered first, so far as convenient, during the line-by-line assessment. After that exercise, the court assesses the total figure by reference to CPR Parts 44.3 and 44.4. Any further reduction must be undertaken by categories or periods of work, rather than line by line, and must avoid double counting.
3. The claimants’ proposed calculation, based on arbitrary multiples of the monetary value of the claim and a mid-point of the resulting range, was fundamentally flawed. The value of the claim is one factor among several and has no special status.
4. The indemnity-basis period was excluded from the proportionality exercise because proportionality has no role in assessing costs ordered on the indemnity basis. The court was required to give effect to the existing costs orders.
5. The claim had a significant non-monetary element, some complexity, and required substantial but reasonable work, including contractual analysis, summary judgment applications, counsel’s involvement and work concerning the account. The defendant’s reasonable instruction of a London firm and the appropriate fee-earner grades were relevant to the assessment.
6. The claimants’ conduct before 9 June 2023 was not unreasonable, but their persistence and procedural activity could still be considered when assessing proportionality. The defendant was entitled to take seriously the potential reputational and wider consequences of the claim, although that did not justify unlimited expenditure.
7. Applying Ainsworth v Stewarts Law LLP [2020] EWCA Civ 178, numerous points of dispute were insufficiently particularised. That did not automatically prevent a further proportionality reduction, but in the circumstances it would have been unfair to use proportionality to reverse the effect of inadequate challenges.

Not stated in the judgment.