D Pride & Partners & Others v Institute for Animal Health & others
| Jurisdiction | England & Wales |
| Judge | Mr Justice Tugendhat |
| Judgment Date | 08 July 2009 |
| Neutral Citation | [2009] EWHC 1617 (QB) |
| Court | Queen's Bench Division |
| Docket Number | Case No: IHQ/08/1018 IHQ/08/1085 |
| Date | 08 July 2009 |
[2009] EWHC 1617 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Before: The Honourable Mr Justice Tugendhat
Case No: IHQ/08/1018
IHQ/08/1044
IHQ/08/1085
Mr Tim Lord QC and Ms Maya Lester (instructed by Thring Townsend Lee & Pemberton) for the Claimants
Mr Michael Beloff QC, Mr Charles Pugh and Mr Ben Cooper (instructed by Manches) for the First Defendant
Mr Tom Adam QC (instructed by Covington & Burling LLP) for the Second Defendant
Mr Nigel Wilkinson QC and Mr David Barr (instructed by DEFRA) for the Third Defendant
Hearing dates: 26 th June 2009
Mr Justice Tugendhat:
On 31 st March 2009 I dismissed the claims of the eighth to fourteenth claimants in this action for reasons set out in the judgment Neutral Citation Number [2009] EWHC 685 (QB). There are now before the court applications for costs, not only in relation to the proceedings of eighth to fourteenth Claimants, but also in relation to proceedings brought by the first to seventh Claimants, and subsequently settled. Brief details of the claims were set out in my judgment at paragraphs 4–6 which are as follows:
4.“This claim was brought by 14 livestock farmers against the two operators of the facilities at Pirbright, the First Defendant (“IAH”), Second Defendant (“Merial”) and against the Third Defendant named as the Secretary of State for Environment, Food and Rural Affairs (“DEFRA”). The claim is for damages for the losses they allege that they have suffered as a result of the tortious act which they allege the Defendants committed, and which caused the leak of live FMD virus (“FMDV”) from the facilities. The claim is founded on the three torts of negligence, private nuisance, and under the rule in Rylands v. Fletcher.
5. The Claim Form was issued on 15 October 2008 and served with Particulars of Claim of the same date. On 12 and 20 November 2008 and 5 December 2008 the Defendants issued Application notices. All three Defendants applied to strike out the claims pursuant to CPR Part 3.4(2)(a), on the grounds that the claims disclosed no good cause of action. IAH and Merial applied in the alternative for summary judgment pursuant to CPR Part 24.2 on the ground that the claimants have no real prospect of establishing any liability of the kind that they are alleged to have sustained. These Applications of the Defendants came before me.
6. Before this hearing the claims of the First to Seventh Claimants were the subject of a settlement made between them, IAH and Merial, with the result that they no longer pursue claims against any of the Defendants. The First to Seventh Claimants are all farmers whose livestock was culled, either because the animals were infected or because they were suspected of being infected. It follows that I am concerned now only with the claims of the Eighth to Fourteenth Claimants (and that D Pride and Partners will have given their name to a case to which they are no longer parties). None of the livestock of the Eighth to Fourteenth Claimants was culled. From this point onwards the words “Claimants” will be used to refer to Eighth to Fourteenth Claimants, except where the context shows otherwise”.
The order sought by IAH is as follows:
1. “Subject to paragraph 2 of the consent order dated 20 February 2009 the first to seventh Claimants shall pay IAH's costs of the proceedings from 30 August 2008 to the conclusion of the proceedings on the standard basis to be assessed if not agreed;
2. Save for those costs referred to in paragraph 3 below, the eighth to fourteenth claimants shall pay IAH's costs of the proceedings from 12 November 2007 to the conclusion of proceedings on the standard basis to be assessed if not agreed;
3. The eighth to fourteenth claimant shall pay IAH's costs of and occasioned by preparation of Trial Bundles E1 to 11 on an indemnity basis;
4. The claimants shall by 4pm on 10 July 2009 pay to IAH the sum of £250,000 on account of IAH's costs;
5. IAH shall be entitled to interest on the costs referred to in paragraphs 1, 2 and 3 from the dates on which IAH paid such costs to its solicitors until 26 th June 2009 at the rate of interest lost by IAH which it would otherwise have earned on the monies deposited at its bank and from 26 June 2009 until payment at the judgment debt rate of 8%”.
The significance of 30 August 2008 is that 29 August 2008 was the last date for acceptance of the Part 36 offers made by IAH and Merial on 8 August 2008. The significance of the 12 th November 2007 is that it is the date on which, as IAH submits, the general nature of the claims of the eighth to fourteenth claimants were made clear.
The order sought by Merial is substantially similar to that sought by IAH. The figure they ask to be paid on account is £510,000.
The order sought by DEFRA is that the eighth to fourteenth claimants pay DEFRA's costs of the proceedings, to be assessed on the standard basis if not agreed. DEFRA adopts the submissions of IAH and Merial in relation to the costs of bundles E1 to E11. It also adopts their submissions as to the rate at which interest should be awarded. DEFRA applies for a payment on account in the sum of £60,000.
The eighth to fourteenth claimants seek an order that the defendants should pay those claimants' costs relating to what are referred to as Stovin or statutory regime and Marcic defences ( Stovin v. Wise [1996] AC 923 and Marcic v Thames Water [2004] 2 AC 42). These were raised and maintained up to the hearing before me, but not advanced before me.
The first to seventh claimants seek orders that the defendants pay: (1) their costs of the action on a standard basis plus interest, and a payment on account of 50% of the total; and (2) their costs of and occasioned by the defendant's application for summary judgment.
The eighth to fourteenth claimants accept that they should pay some of the defendants' costs of the application which I granted on 31 March 2009, insofar as those costs relate to the eighth to fourteenth claimants. But they submit that they should not bear any costs relating to the statutory regime/ Marcic defence but that, on the contrary, the defendants should pay the costs of the eighth to fourteenth claimants arising out of that point (or alternatively those claimants should not have to pay more than 60% of the defendants costs insofar as those costs relate to the eighth to fourteenth claimant). In addition the eighth to fourteenth claimants submit there should be a further 50% reduction of the costs ordered to be paid to the defendants to reflect the duplication of the defendant's submissions.
The first to seventh claimants submit they should not bear any of the defendant's costs of these applications, and the defendants should pay them their costs of and occasioned by the application, which were made against them too, and discontinued only on Friday 20 February 2009, the last day before the start of the hearing on the following Monday.
COSTS OF PROCEEDINGS BY THE FIRST TO SEVENTH CLAIMANTS.
On 20 February 2009 the first and second defendants (but not DEFRA) entered into a settlement agreement with the first to seventh claimants in accordance with which they paid the entire sum claimed by those claimants. A Consent Order was drawn up which included provision for the discontinuance of the claims of those claimants and the following further orders:
2. “The First and Second Defendants to pay the reasonable costs incurred prior to the commencement of the proceedings of the first to seventh claimants (inclusive) on the standard basis to be assessed if not agreed, for the avoidance of doubt these costs to include the preparation of the schedule of loss included at Appendix 1 to the Particulars of Claim served in the Proceedings, but not including the costs of preparation and service of the Particulars of Claim themselves;
3. The costs of the First to Seventh Claimants of and associated with the preparation and service of the Particulars of Claim served in these proceedings and all costs subsequent to the commencement of the proceedings, including subsequent steps in the proceedings, are to be reserved pending final judgment or settlement of the proceedings as continued by the eighth to fourteenth claimants”.
In a witness statement dated 16 June 2009 Mr Cusick of Thring Townsend Lee & Pemberton (“TTLP”), the solicitors for all the claimants, states that the total costs of the first to seventh claimants, exclusive of interest and VAT (which they do not claim), amount to £430,259.93. They seek payment on account of £215,000.
In the skeleton argument submitted on behalf of the first to seventh claimant it is said that the defendants should be ordered to pay the costs of the action on a standard basis (plus the interest), since the defendants settled their claims in full the day before the application to strike out their claims was due to be heard. It is submitted that they were fully justified in issuing proceedings, given the manner in which the defendants conducted themselves in the run up to proceedings being issued. It is said that the defendants expressly sought to keep alive the issue of liability, and in response to the issue of proceedings the defendants applied to strike out the claims of the first to seventh claimants. The basis of that application was the point referred to as statutory regime/ Marcic which the first to seventh claimant submits was unsustainable.
Mr Cusick made his statement in response to the first witness statement made by Ms Bond of Manches (solicitors to IAH) on 27 March 2009 and of Mr Enock, of Covington & Burling LLP, solicitors for Merial. The correspondence between the parties is referred to by the makers of these witness statements.
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