Dr Manori Balachandra v NHS Commissioning Board (Costs)

Where a party has succeeded overall, the general rule is that costs should follow the event. The court must assess success in substance and may adjust the order to reflect issues, conduct and unnecessary costs. A reduction is not justified merely because the successful party recovered a smaller proportion of its claimed quantum where liability was the principal issue and quantum was agreed. Conduct may justify a reduction where a party failed to provide information which could have resolved the dispute earlier. The court must balance that conduct against the opposing party’s own conduct, including continuing an unsuccessful defence after receiving material sufficient to determine entitlement.

The claimant, a dental practice operator, brought a contractual claim against the defendant concerning payments for dental activity in the years 2019–2020 and 2020–2021. In the liability judgment, [2026] EWHC 294 (KB), the court decided the primary contractual issue for 2019–2020 in the claimant’s favour and found the defendant’s original decision for 2020–2021 unreasonable, while leaving the final position pending further analysis. The parties later agreed quantum. The claimant recovered about 20% of the 2019–2020 quantum and virtually all of the 2020–2021 claim. The issue was whether the claimant should recover its costs in full or subject to the defendant’s proposed 45% reduction.

1. Overall result. The claimant was successful overall. The general rule under CPR 44.2(2)(a) therefore applied, and the claimant was entitled to a costs order in her favour.
2. The court rejected a reduction based on issues concerning the reasonableness of the defendant’s discretion and restitution. Those issues arose from the defendant’s incorrect stance on its contractual rights. The claimant succeeded in establishing that the contract made it unnecessary to determine them. The abandoned mid-year review issue was not sufficiently significant to justify an adjustment.
3. The fact that the claimant recovered only about 20% of the claimed 2019–2020 quantum did not justify reducing costs. The trial principally concerned liability, quantum was agreed, and the relevant data was readily available. If the defendant wished to protect its position on costs, it could have made a Part 36 offer after analysing the spreadsheets.
4. The pre-action correspondence had greater significance for 2020–2021. The claimant’s failure to provide requested information earlier contributed to unnecessary costs and might have enabled earlier resolution. However, the defendant had obtained sufficient material six weeks before trial, chose not to analyse it, and continued unsuccessfully defending its original decision. That conduct was unsatisfactory.
5. Balancing both parties’ conduct, the appropriate order was to award the claimant her costs subject to a 10% deduction. The defendant was ordered to pay 90% of the claimant’s costs, to be taxed if not agreed, and to make an interim payment on account of costs of £130,500.

• High Court (King’s Bench Division): In the liability judgment, [2026] EWHC 294 (KB), the court decided the principal contractual issues and deferred final determination of the 2020–2021 position pending further material. The present court then determined costs.