Court Orders First Defendant to Pay Costs in WOL (London) LLP v Croydon Investments Limited & Ors Dispute

Citation: [2024] EWHC 485 (TCC)
Judgment on

Introduction

The decision in WOL (London) LLP v Croydon Investments Limited & Ors is a Technology and Construction Court case focused on a dispute over costs related to a strike-out application and the re-amendment of particulars of claim. The judgment, delivered by Mr Roger ter Haar KC, addresses the distribution of legal costs following the dismissal of the First Defendant’s application to strike out the Claimant’s Amended Particulars of Claim and their subsequent application for summary judgment.

Key Facts

In this case, a judgment was previously handed down on 9 February 2024, dismissing the First Defendant’s application to strike out the Claimant’s Amended Particulars of Claim or, alternatively, summary judgment against the Claimant. Following this decision, the court had the tasks of considering the Claimant’s application to re-amend the Particulars of Claim and resolving the issues related to the costs incurred by the parties during the application.

The Second Defendant was not represented in these proceedings. The Third Defendant had an interest in the outcome of the application, attended the hearing, and sought their costs as a result of their involvement.

Several legal principles underpin the judgment:

  1. Permission for Re-Amendment of Pleadings: The court has the authority to allow a party to re-amend its pleading to address any deficiencies. Here, the court granted permission for the Claimant’s draft Re-Amendment to solve issues in the existing Amended Particulars of Claim.

  2. Costs Orders Following Unsuccessful Applications: Where an application by a Defendant is dismissed, as was the First Defendant’s application in this case, it is common for the court to order the unsuccessful party to pay the costs of the successful party. The principle of “costs follow the event” is applied.

  3. Standard vs. Indemnity Basis for Costs Assessment: Costs can be assessed on either a standard or an indemnity basis, depending on the circumstances of the case. The indemnity basis is only justified when there is conduct or circumstances which take the case out of the norm. In this case, the court declined to order costs on the indemnity basis, finding nothing to justify such an order.

  4. Summary Assessment of Costs: Courts can choose either to assess costs summarily or to order detailed assessment if the costs are not agreed upon. The Judge opted for a detailed assessment due to the high amount claimed by the Claimant.

  5. Payment on Account of Costs: When ordering costs to be subject to detailed assessment, a court might order an interim payment on account of those costs. The court did so in this instance, directing a payment representative of 50% of 90% of the costs claimed by the Claimant.

  6. Costs for Parties Not Directly Involved in Applications: Parties not directly a part of an application may be entitled to costs if their interest in the outcome is sufficiently active and if their attendance at the hearing was reasonable. The Third Defendant’s cost claim was granted on this basis, illustrating that non-parties to an application who are affected by the decision can recover their costs.

Outcomes

The outcomes of the hearing as represented in the judgment were:

  1. The Claimant was granted permission to file a Re-Amendment of the Particulars of Claim.

  2. The First Defendant was ordered to pay 90% of the Claimant’s costs related to the application, acknowledging the necessity of the Claimant’s re-amendment of the pleading.

  3. The costs were to be assessed on the standard basis due to the absence of circumstances warranting indemnity costs.

  4. An order was made for the First Defendant to pay a provisional sum as a payment on account of costs at £38,394.54.

  5. The First Defendant was also ordered to pay the Third Defendant’s costs, which were summarily assessed at £23,504.58 minus any non-recoverable VAT.

Conclusion

In WOL (London) LLP v Croydon Investments Limited & Ors, the court reaffirmed principles related to costs orders following unsuccessful applications, re-amendment of pleadings, and the rights of interested third parties to recover costs. This costs judgment demonstrates the courts’ discretion in balancing the objectives of justice, efficiency, and proportionality when assessing costs between parties involved in legal applications. The decision underlines the importance of successful parties recovering costs and the principle of “costs follow the event,” while also taking into account necessary adjustments for specific circumstances within a case.

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