High Court Judgment Emphasizes Conduct and Settlement Offers' Impact on Costs in Multi-Claimant Litigation Case

Citation: [2024] EWHC 274 (Ch)
Judgment on

Introduction

The High Court of Justice’s ruling in The Duke of Sussex & Ors v MGN Limited [2024] EWHC 274 (Ch) presents a comprehensive review of the costs and conduct associated with claims in the context of a managed litigation involving multiple claimants against a defendant for allegations of unlawful and illegal activities. The judgment represents an intricate balance between rewarding the successful pursuit of generic issues with costs on the indemnity basis, while also sanctioning parties for unreasonable conduct and failure to engage in settlement offers with costs on varying bases of assessment.

Key Facts

The case involves the claims of Mr Turner, Ms Sanderson, Ms Wightman, and the Duke of Sussex against MGN Limited (MGN), concerning unlawful and illegal activities by MGN journalists. While Mr Turner’s claim was partly successful, Ms Sanderson’s and Ms Wightman’s claims failed on limitation grounds. The trial encompassed generic issues addressing MGN’s conduct from 1998 to 2011 and individual claims concerning published articles and unlawful information-gathering activities. Offers to settle were a critical aspect of these proceedings, notably affecting the costs consequences for claimants who failed to beat these offers.

Several legal principles underpin the judgment:

  1. Costs Consequences and Offers to Settle: The judgment illustrates that failure to beat Calderbank and Part 36 settlement offers significantly impacts the costs consequences for claimants, even when they have succeeded on some issues in their claims.

  2. Conduct and Costs: The case demonstrates that litigants’ conduct can warrant alteration from the standard cost recovery basis, moving to an indemnity basis if behavior during litigation is deemed “out of the norm,” as evidenced by exaggeration of claims or failure to engage reasonably in settlement negotiations.

  3. Success on Generic Issues: Success on generic issues tried separately can lead to an award of the costs of these issues on an indemnity basis, even when claimants may have failed on their individual claims.

  4. Interest on Costs: Interest may be awarded on costs where a party is in the position of having to make payment, illustrating a principle of compensation for the time value of money expended in litigation.

Outcomes

The outcomes of the judgment reflect the various principles applied:

  • For Mr Turner: Despite being awarded damages, he was ordered to pay MGN’s costs from the specified date due to not beating settlement offers but was awarded his own costs up to the date of the first relevant offer.

  • For Ms Sanderson: Her conduct led to an indemnity basis assessment for her costs payable to MGN due to the unreasonable litigation conduct, including exaggerated claims and failure to engage in settlement negotiations.

  • For Ms Wightman: Her costs were assessed on the standard basis, reflecting a less critical view of her conduct.

  • For Generic Issues: The claimants, including the unsuccessful ones, were awarded their common costs of the generic trial issues on an indemnity basis, underlining the distinction in assessing costs for separate elements of the trial.

  • Interest on Costs: Interest was ordered on the individual costs payable to MGN due to the claimants’ failure to accept reasonable offers.

Conclusion

The Duke of Sussex & Ors v MGN Limited case is instructive for litigants and legal professionals alike, emphasizing the significance of conduct in litigation and the treatment of offers to settle. It highlights that costs orders can reflect both success and sanction within the same judgment and underscores the importance of engaging earnestly in the pre-trial settlement process. Navigating the fine balance between the pursuit of legal redress and the risks of litigation costs remains a critical aspect of strategic decision-making in court proceedings.

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