Court’s Discretion in Awarding Costs Following Interim Applications: Lee Chu v Kin Ming Je & Anor (Costs) [2024] EWHC 455 (Ch)

Citation: [2024] EWHC 455 (Ch)
Judgment on

Introduction

The case of Lee Chu v Kin Ming Je & Anor (Costs) [2024] EWHC 455 (Ch) revolves around the issue of cost awards following a series of interim applications. The judgment articulates the application of legal principles concerning the incidence of costs, the discretion of the court in awarding costs, the identification of the “winner,” and the appropriate basis for assessing costs. The decision was made by HHJ JOHNS KC, who carefully examined the particulars of each application and submissions made by both parties to arrive at a just determination.

Key Facts

In this case, multiple interim applications were made between the claimant, Lee Chu, and the defendants, including applications for a worldwide freezing injunction, asset disclosure order, and contesting jurisdiction. The claimant was successful in some applications against Mr. Je, while Ms. Chu’s application against Ms. Rong for a worldwide freezing injunction was dismissed; other applications made by both defendants were also dismissed.

Counsel for the claimant and defendants provided written submissions concerning the costs of these applications, and the court made a detailed judgment addressing costs on an individual basis for each application.

The legal principles discussed in the case are:

  1. Incidence of Costs: Governed by Civil Procedure Rules (CPR) 44.2, the court must identify the “winner,” and the general rule is that the winner recovers their costs. However, the court has the discretion to order otherwise based on the circumstances.

  2. Proportion of Costs: Under CPR 44.2(6)(a), the court may order a party to pay a proportion of the costs if justified by the conduct of the parties or other relevant factors.

  3. Conduct of the Parties: The court takes into consideration the conduct of the parties when determining costs, such as criticisms of delay, the need for amendments, and the overall resistance of the defence.

  4. Standard versus Indemnity Basis: The judgment differentiates between costs assessed on the standard basis and those on the indemnity basis, the latter being awarded when conduct takes a case out of the norm.

  5. Assessment of Costs: The decision directs a detailed assessment of costs, where the reasonable and proportionate costs are determined after legal scrutiny.

  6. Payments on Account: According to CPR 44.2(8), an order for payment on account of assessed costs may be made unless there is good reason not to.

Outcomes

The court made the following specific outcomes regarding costs:

  • Mr. Je was ordered to pay the costs of the application for a worldwide freezing injunction against him.
  • Ms. Chu was ordered to pay Ms. Rong’s costs for the application for a worldwide freezing injunction which was dismissed.
  • Mr. Je and Ms. Rong were ordered to pay Ms. Chu’s costs for their failed strike out applications and jurisdiction contest applications, respectively.
  • Ms. Chu and Mr. Je were involved in a contest on an expert evidence application. Ms. Chu succeeded and was consequently awarded costs against Mr. Je but not against Ms. Rong.
  • Detailed assessment of the costs was directed, with Ms. Chu being awarded a payment on account of her costs from Mr. Je, totalling £150,000.

Conclusion

In Lee Chu v Kin Ming Je & Anor (Costs), the court showcased a meticulous and principled approach to awarding costs, closely aligning with the established rules under CPR 44. This case serves as an important reference for legal professionals seeking to understand the court’s discretion and methodology in awarding costs following interim applications. The decision emphasizes that cost orders aim to administer justice, taking into account the conduct of the parties and the success of the applications made.

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