MDW Holdings Ltd v James Robert Norvill

JurisdictionEngland & Wales
JudgeKeyser
Judgment Date23 July 2021
Neutral Citation[2021] EWHC 2043 (Ch)
Docket NumberCase No: BL-2019-CDF-000002
CourtChancery Division

[2021] EWHC 2043 (Ch)

IN THE HIGH COURT OF JUSTICE

BUSINESS AND PROPERTY COURTS IN WALES

BUSINESS LIST (ChD)

Cardiff Civil Justice Centre

2 Park Street, Cardiff, CF10 1ET

Before:

HIS HONOUR JUDGE Keyser QC

sitting as a Judge of the High Court

Case No: BL-2019-CDF-000002

Between:
MDW Holdings Limited
Claimant
and
(1) James Robert Norvill
(2) Jane Rosemary Norvill
(3) Stephen John Norvill
Defendants

Andrew Ayres QC and Laurie Scher (instructed by Morgan LaRoche Ltd) for the Claimant

Hugh Sims QC and Jay Jagasia (instructed by Blake Morgan LLP) for the Defendants

Written Submissions: 4 and 18 June 2021

Approved Judgment

I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.

HIS HONOUR JUDGE Keyser QC

JUDGE Keyser QC:

1

I handed down judgment in this case on 4 May 2021 with the citation [2021] EWHC 1135 (Ch). The judgment sum of £382,600 for damages has been paid. This is my judgment on the consequential matters arising. Having decided to overcome listing difficulties by dealing with those matters on paper, I have received 79 pages of written submissions together with substantial annexes and a large bundle of authorities; for all of which, I am grateful. I have taken the submissions fully into account, but in the interests of avoiding further delay I do not intend to recite the competing arguments in any detail and shall state my decisions as shortly as possible.

The incidence of costs

2

The claimant seeks an order that the defendants pay all its costs of the case. The defendants seek an issue-based (or a percentage-based) order for costs or no order for costs between the parties.

3

The incidence of costs is a different issue from the basis on which any costs ordered to be paid are to be assessed. I deal with them separately. Nevertheless, matters of conduct are capable of being relevant to both issues, and I bear this in mind. The order to be made in each regard is a matter of the court's discretion, and it seems to me that one ought to have an eye to the overall justice of the matter when making a decision on either issue.

4

The court has a discretion whether to make any order for costs at all. If the court decides to make any order for costs, the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party; however, the court may decide to make a different order. In deciding what, if any, order to make as to costs, the court will have regard to all the circumstances, including conduct, any partial success, and any admissible offers outside Part 36: r. 44.2.

5

The claimant was the successful party, because an award of damages was made in its favour. This indicates that the primary issue is whether there are sufficient reasons to justify a departure from the general rule, according to which the defendants would be expected to pay the claimant's costs. I would make this general comment. The court's discretion, to be exercised in accordance with Part 44, is unfettered. But this does not, in my judgment, mean that the general rule of winner gets the costs is a mere starting place, as though it were a fulcrum on which the seesaw might tip freely as pressures were exerted first on this side and then on that. The fact of success, bringing the general rule into operation, is a weighty factor in its own right and its weight must be respected.

6

In brief summary, the defendants contend for a departure from the general rule on the following basis. The claim as a whole was considerably exaggerated, the claimant recovering only about one-third of the amount it sought. On two of the three big issues concerning waste-disposal malpractice (cess waste and tank bottom waste) its case failed; only in respect of leachate / trade effluent did it succeed at all, and then to a modest extent. The claimant's approach to identification, explanation and quantification of loss, as regards the claim as a whole and the specific headline issues, was “amorphic and dysfunctional” and its response, when this was pointed out and when Mr Mesher demonstrated that its case did not stack up, was not to acknowledge the truth but to double-down on its contentions and engage in “shenanigans” including a groundless attempt to recategorize certain kinds of waste as tank bottom waste. Detailed analyses of the time and effort consumed by dealing with the issues on which the claimant was unsuccessful are set out in two annexes to the defendants' submissions and in paragraphs 20 and 21 of those submissions. In the circumstances, it is said that the claimant's conduct in presenting an exaggerated claim and unreasonably pursuing aspects of it that ought to have been abandoned must be reflected in costs, and that the defendants were successful on discrete issues for which they ought to recover costs; and that the appropriate order is that each party bear its own costs, or alternatively that costs be apportioned by issue or by percentage (such apportionment being, it is suggested, likely to result in at most a modest recovery by the claimants).

7

Several familiar authorities were cited and I have regard to them. I single out one passage that seems to me to be helpful in this and other cases, though it concerns only part of the argument before me. In Hospira UK Ltd v Novartis AG [2013] EWHC 886 (Pat), Arnold J dealt with a dispute about costs in circumstances where the claimants were the successful party but the defendants had succeeded on some aspects of the case. He said:

“2. The principles to be applied in these circumstances are familiar subject to one small qualification. The court generally approaches the matter by asking itself three questions: first, who has won; secondly, has the winning party lost on an issue which is suitably circumscribed so as to deprive that party of the costs of that issue; and thirdly, are the circumstances (as it is sometimes put) suitably exceptional to justify the making of a costs order on that issue against the party that has won overall.

3. I say sometimes put because I think a review of decisions of the Patents Court on costs issues over the past five years would show that that particular phraseology is often, but not always, employed. Sometimes it has put been put in slightly different ways, notably by myself.

4. The origin of the phrase ‘suitably exceptional’ is the judgment of Longmore LJ in Summit Property v Pitmans (A Firm) [2001] EWCA Civ 2020. As has been pointed out recently by Davis LJ in F&C Alternative Investments (Holdings) Ltd v Barthelemy [2012] EWCA Civ 843 at [46]–[49], it is apparent that Longmore LJ was not intending when using the words ‘suitably exceptional’ in the particular circumstances in which he did to impose a specific requirement of exceptionality. The question rather is one of whether it is appropriate in all the circumstances of the individual case not merely to deprive the winning party of its costs on an issue in relation to which it has lost, but also to require it to pay the other side's costs.”

8

Although the claimant was the successful party in the case as a whole, the defendants succeeded on two main waste-disposal issues, namely cess waste and tank bottom waste. Those issues were, in my judgment, sufficiently circumscribed to be capable of justifying an issues-based order. Although they were not substantive heads of claim as such (this was not a claim for damages for improper waste-disposal but for deceit and breach of warranty), they were not merely part of the argument in the case, where a claimant might lose the battle but win the war; they were specific factual issues relating to allegedly unlawful practices and forming the bases of allegations of deceit and breach of warranty, in respect of which discrete factual and expert evidence was given and, far from being parasitic on other such matters, had their own vitality. Having regard to the different “metrics” offered to me by the parties and also to my sense of the case, having heard it at length and considered it at greater length thereafter, I should assess the proportion of the case as a whole that was attributable to those two issues as about 25 per cent. This suggests to me, as a preliminary conclusion, that the claimant should not recover that proportion of its costs. (Because the evidence was not neatly packaged and several witnesses dealt with more than one issue, a percentage order would be a more convenient way to deal with the matter than a strictly issue-based order.)

9

It is then necessary to consider whether other relevant factors make it appropriate to award to the claimant some greater or lesser proportion of its costs or to make an order for costs in favour of the defendants, or indeed both.

10

I do not consider that admissible offers of settlement take the matter further. The defendants point to a Part 36 offer which they made and point out that it would have given them costs protection if I had decided a particular issue on quantification differently. That, however, is always the case with ineffectual Part 36 offers: if the court had reached a sufficiently different decision, the offer would have afforded protection.

11

The defendants complain that the manner in which the claimant presented its claim rendered them less able to form a proper assessment of the case and therefore to protect their position. I do not agree. In my judgment, this is just the sort of case where, despite protestations about “the distorting effect caused by MDW's approach” (defendants' submissions in reply, paragraph 6), the defendants were perfectly able to form their...

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