Costs News

08 January 2020
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News in brief - 09.01.2020

Mandatory e-filing deadline approaches

From 20 January, it will be mandatory for legally represented parties to use the e-filing service to start and/or continue any relevant claims, detailed assessment proceedings or applications for Senior Courts Costs Office matters. HM Courts and Tribunals Service guidance can be found here, and there are three webinars running next week to introduce the service to users. The details are here.

 

Contractual entitlement to indemnity costs upheld

A contract specifying that a party was entitled to "all reasonable costs and expenses" of litigation in connection with preserving its contractual rights meant that it was entitled to costs on the indemnity basis, according to the High Court – the word "reasonable" did not exclude indemnity costs.

Mrs Justice Moulder ruled that, under rule 44.3, a party was only entitled to recover reasonably incurred costs on either the standard or indemnity basis.

According to a Lawtel report of Alafco Irish Aircraft Leasing Sixteen Ltd v Hong Kong Airlines Ltd, the claimant sought its costs on the indemnity basis following its successful summary judgment application on the basis of the defendant’s conduct and also that the reference to all reasonable costs being paid created a contractual entitlement to indemnity costs.

For the latter, the claimant relied on Littlestone v MacLeish [2016] EWCA Civ 127, in which the relevant contractual provision had referred to "all costs" rather than "all reasonable costs". However, the court had concluded that a reference to reasonableness would not have added anything, given that under rule 44.3 a party was only entitled to its reasonably incurred costs, whether on the standard or indemnity basis.

Though Moulder J found the defendant’s conduct did not justify indemnity costs, there was no reason to depart from the reasoning in Littlestone. “The presence of the word ‘reasonable’ did not preclude an award of indemnity costs,” the report concluded. “The claimant was entitled to have all of its reasonable legal costs and expenses paid.”

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