Hasbro Consumer Products Licensing Limited & Anor v Công Ty Tnhh Ðàu Tu Công Nghe Và Dich Vu Sconnect Viet Nam & Ors

When an application has been compromised and only costs remain, the court should rarely investigate the underlying merits or predict the result. It may decline to decide costs or make no order. If the likely outcome is plain and obvious, it may adopt a high-level, broad-brush approach. The court should identify the overall successful party and then apply the discretion in the Civil Procedure Rules 1998, rule 44.2, considering all circumstances, including conduct and partial success. An amending party will generally pay costs arising from its amendments, but recovery may be adjusted for iterative pleading, reasonable opposition and other matters. A compromised substitution application may attract no order where the objections were not plainly unreasonable.

The claimants sought costs following two applications in an intellectual property claim. An application to substitute the claimants was resolved by consent before the October 2024 hearing. An amendment application was fully argued but later resolved by a consent order dated 6 May 2025, with costs left to the court.

The defendants did not attend the costs hearing, but the court considered their written submissions. The issues were the costs of the amendment application, costs incurred because of the amendments, and costs of the substitution application. The central issue was how the costs discretion applied to compromised applications and how the parties’ conduct, iterative amendments and success achieved should affect the orders.

Disposition. The defendants were ordered to pay 60% of the claimants’ costs of the amendment application on the standard basis. The claimants were ordered to pay the defendants’ costs of and occasioned by amendments incurred after 6 May 2025, also on the standard basis. There was no order as to the costs of the substitution application.

1. Compromised applications. Applying the approach in Harrington & Charles Trading Company Limited (in Liquidation) v Mehta ([2026] EWHC 387 (Ch)), the court held that it should rarely investigate the merits of a compromised application or predict the result after a full hearing. It may decline to decide costs or make no order. If the outcome is plain and obvious, it may make a costs order only on a high-level, broad-brush basis. Reserving costs for later determination does not alter that approach.
2. Amendment application. Because the application had been fully argued and the final amended pleading was later accepted by consent, the court could take the consent into account as an implicit waiver of many earlier objections. It was satisfied that the claimants would at least have substantially succeeded and were the successful party overall. Under the Civil Procedure Rules 1998, rule 44.2, the general rule was the starting point, but the iterative amendments, the substantial further amendments concerning artistic works and the reasonableness of some opposition justified reducing recovery to 60%. A principle relied on from Chadwick v Hollingsworth (No. 2) ([2010] EWHC 2718 (QB)) did not justify reserving costs to the trial judge because the amendments did not present a wholly new case.
3. Costs occasioned by amendments. The costs of considering amendments merely to decide whether to consent formed part of the application costs. The separate order for costs of and occasioned by the amendments was limited to costs incurred after 6 May 2025 and did not include the costs of preparing the amendments themselves.
4. Substitution application. The defendants’ conditions for consent were not plainly unreasonable, were satisfied, and the dispute had not been argued to judgment. Applying the broad-brush approach to compromised applications, no order as to costs was appropriate.

not stated in the judgment.