The usual rule in Court proceedings is that the winning party can ask for their costs to be paid by the losing party. Traditionally, the Court would make sure that the winning party could only recover their costs that were "reasonably incurred". More recently it has adopted a "proportionality" test so that the costs incurred have to be proportionate to the matter in dispute.
Two recent high profile cases decided in the High Court have cast light on this proportionality test.
The first involves a primary school teacher who had a relationship with a Premiership footballer. That relationship was only known to a handful of people. She lost her mobile phone which contained details of her relationship. The details became known to the Sunday People who intended to publish the story. The teacher successfully stopped publication of her confidential information and obtained damages of £20,000. Her costs were £241,817. The costs judge initially reduced the costs to £167,389.45 as a figure that would be "reasonable" for the losing party to pay, but then reduced that sum by about one half to £83,964.80 so that the figure was "proportionate" to the matters in dispute.
The second involved Brian May (guitarist for Queen, astrophysicist and famous badger protector). He was also in dispute with his neighbours over their basement development and successfully obtained damages of £25,000. His costs were £208,236.54 including VAT. The costs judge initially reduced the costs to £99,000 as a "reasonable" figure and then further reduced it to £35,000 so that the figure was "proportionate".
In both cases, whilst the winning parties had achieved their aims, once the dust had settled they were both significantly out of pocket.
Proportionality is a difficult issue to manage:
- Its self evident that the costs of dealing with a ten thousand pound claim should be less than a one hundred thousand pound claim. But what if the ten thousand pound claim is legally more complex? Should there be a limit to the evidence you can put before the Court just because of the value of the claim?
- What is the actions of your opponent during the Court proceedings are deliberately designed to be mischievous and drive up costs? Should you be penalised for disproportionate costs that you have incurred as a direct result of your opponents conduct?
- Who gets to decide how important the issues are and therefore what is proportionate? The primary school teacher was fighting for her right to a private life against a tabloid newspaper who simply wanted to sell papers. Why should she be out of pocket at the end of that process?
Hopefully you never become embroiled in Court proceedings. If however you do, at Buckles Solicitors our dispute resolution team is experienced in dealing with all of these issues to try to achieve the best outcome at a proportionate cost. Contact us on 01733 888888 or email me nick-porter@buckles-law.co.uk.
