Ineos Upstream Limited & Ors v Joseph Boyd & Anor
[2023] EWHC 1756 (Ch)
Henderson & Jones Limited v David Jason Ross & Ors
9 June 2023
[2023] EWHC 1585 (Ch)
High Court
The claimant lost its case and has to pay the defendants' legal costs, a much larger amount than usual, because the judge thought the claimant's case was weak, poorly presented, and they tried to get extra attention for their case. The judge also set how much the claimant had to pay immediately and when the rest would be due.
Key Facts
- •Henderson & Jones Limited (Claimant) brought multiple claims against five defendants for breach of directors' duties, knowing assistance, negligence, and unlawful conspiracy.
- •The claims were dismissed in their entirety by Mr Justice Richard Smith on May 26, 2023.
- •The consequential matters concerning costs and interest were heard on June 9, 2023.
- •The defendants sought indemnity costs, while the claimant argued for standard costs.
- •Disputes arose regarding the payment on account percentage, pre-judgment interest rate, post-judgment interest commencement date, and timing of payment.
Legal Principles
Costs should be awarded on the standard basis, unless the conduct of the parties or circumstances warrant indemnity costs.
General legal principle on costs assessment.
Indemnity costs may be appropriate in unsuccessful fraud trials.
Clutterbuck v HSBC plc [2015] EWHC 3233 (Ch) (at [16] to [17])
Failure of a case of dishonesty or fraud doesn't automatically justify indemnity costs; a high level of inappropriateness or unreasonableness is required.
Three Rivers District Council v Bank of England [2006] Costs Law Review 714 (at [25(4)-(8)]), Libyan Investment Authority and others v King and Others [2023] EWHC 434 (Ch) (at [6])
Indemnity costs should not be awarded simply because the paying party was wrong.
Williams v Jarvis [2009] EWHC 1837 (QB) (at [13])
The purpose of pre-judgment interest is to compensate for the loss of money or borrowing costs; the rate may vary depending on the litigant.
General legal principle on pre-judgment interest.
Outcomes
Indemnity costs awarded to all defendants.
The claimant's claims were speculative, weak, and thin; serious allegations were made; the claimant's approach was unrealistic and ignored key evidence; the claimant courted publicity; the claim valuation was unrealistic; and the proceedings were brought primarily against defendants with deep pockets.
Payment on account of 70% of incurred costs ordered for each defendant.
Consideration of cost estimates, potential reductions on assessment, basis of assessment, substance of the case, likely costs, and appeal prospects.
Pre-judgment interest rates set at 4% for D1 and D2, 2.5% for D5, and 3% for D6.
General appraisal of the position, considering reasonableness and the classes of litigant.
Post-judgment interest to start 21 days from June 9, 2023.
Claimant had sufficient information to assess liability; significant costs incurred; prior engagement with defendants on costs.
Permission to appeal refused.
No real prospect of success; no other compelling reason to hear the appeal.