The Huntsworth Wine Company Ltd v London City Bond Ltd
| Jurisdiction | England & Wales |
| Judge | Pearce |
| Judgment Date | 19 January 2022 |
| Neutral Citation | [2022] EWHC 97 (Comm) |
| Docket Number | Case No. LM-2019-000175 |
| Court | Queen's Bench Division (Commercial Court) |
[2022] EWHC 97 (Comm)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
THE LONDON CIRCUIT COMMERCIAL COURT (QBD)
SHORTER TRIALS SCHEME
HIS HONOUR JUDGE Pearce SITTING AS A JUDGE OF THE HIGH COURT
Case No. LM-2019-000175
INDEX
| SECTION | SUB-SECTION | PAGE | |
| Background | 3 | ||
| Huntsworth's Position | 5 | ||
| LCB's Position | 6 | ||
| The Relevant Law | 7 | ||
| The Proper approach | 9 | ||
| The Issues | A. The alleged Part 36 offer | 10 | |
| B. Who was the successful party? | 22 | ||
| C. The conduct of the parties | 23 | ||
| D. Admissible offers to settle | 28 | ||
| E. The appropriate costs order in respect of the costs of the claim | 29 | ||
| F. Quantification of the costs order | 29 | ||
| F1. Introduction | 29 | ||
| F2. Pre Action Costs | 31 | ||
| F3. Issues/Statements of Case | 32 | ||
| F4. Case Management Conference | 32 | ||
| F5. Disclosure | 32 | ||
| F6. Witness Statements | 32 | ||
| F7. Pre Trial Review | 33 | ||
| F8. Trial Preparation | 33 | ||
| F9. Trial | 34 | ||
| F10. ADR/Settlement Discussions | 34 | ||
| F11. Post Trial Costs | 34 | ||
| F12. Costs of and occasioned by amendment and re-amendment of the Particulars of Claim | 35 | ||
| G. Interlocutory costs orders | 37 | ||
| G1. Order of 16 July 2020 — costs of and occasioned by amendments to the Defence which are not occasioned by responding to amendments to the Particulars of Claim | 37 | ||
| G2. Order of 30 October 2020 — application to transfer to the shorter trials scheme and case management | 37 | ||
| G3. Order of 23 March 2021 — application for specific disclosure | 38 | ||
| Other matters arising from CPR 36.17 | 39 | ||
| Conclusion | 42 | ||
| Appendix | 43 |
BACKGROUND
In this action, Huntsworth brought a claim for losses sustained as a result of the theft of wine belonging to Huntsworth that was stored at a bonded warehouse owned and operated by London City Bond at Linton in Cambridgeshire. (An issue arises as to whether London City Bond is properly to be considered the claimant for certain reasons relating to its Part 36 offer. For the sake of clarity, I shall therefore not call the parties the claimant and the defendant, but rather their names, abbreviated to Huntsworth and LCB respectively.)
The case proceeded under the Shorter Trials Scheme pursuant to CPR PD57AB. Following a trial with oral evidence in July 2021 and written closing submissions thereafter, I handed down judgment on issues of liability and quantum on 22 October 2021.
In my judgment, I identified in all 12 issues as follows:
3.1 Liability Issues on the Claim
Issue 1: Was there a contract on United Kingdom Warehousekeepers' Association (“UKWA”) terms with a £1,000 uplift of liability?
Issue 2: Did LCB fail to take reasonable care of the goods?
Issue 3: Was the theft carried out with the Defendant's employees' complicity?
Issue 4: Is LCB in principle vicariously liable for any complicity by its employees?
Issue 5: Is the Defendant's potential liability pursuant to Issues 2 and/or 4 in principle excluded by the UKWA terms?
Issue 6: Is any exclusion of liability ineffective because of deviation from the contractual obligations?
Issue 7: Was Huntsworth induced to contract by a fraudulent misrepresentation/ misstatement by LCB that CCTV was monitored at reasonable intervals?
Issue 8: Are the misrepresentation/misstatement claims time barred?
3.2 Quantum Issues on the Claim
Issue 9: Is LCB entitled to rely on the limitation of liability?
Issue 10: What was the value of the goods stolen?
Issue 11: Is Huntsworth entitled to recover VAT?
3.3 Issues on the Counterclaim
Issue 12: Is Huntsworth liable to reimburse LCB for excise duty?
I gave judgment for Huntsworth on the claim in the sum of £1,000 together with interest of £67.88 and judgment for LCB on the counterclaim in the sum of £3,662.34 together with interest of £243.07. Thus the net sum due from Huntsworth to LCB pursuant to my judgment was £2,837.53.
The Shorter Trials Scheme anticipates a summary assessment of the costs of any party in whose favour a costs order is made (see paragraph 22.59 of PD57AB). In order to accommodate this, the order on handing down judgment on 22 October 2021 (made by consent in this respect) provided the following in respect of the determination of costs issues, reflecting the scheme of PD57AB:
“ 4. Matters of costs and of associated matters arising under CPR Part 36 (if applicable) are reserved and shall be determined summarily pursuant to paragraph 2.59(a) of Practice Direction 57AB and the procedure set out in paragraph 5 below.
5. The apportionment and summary assessment of costs shall be determined by the Court without a hearing as follows:
(a) By 4pm on 12 November 2021 the Claimant and the Defendant shall each file and simultaneously exchange schedules of their costs incurred in the proceedings in the form described in paragraph 2.58 of Practice Direction 57AB.
(b) By 4pm on 26 November 2021 the Claimant and the Defendant shall each file and simultaneously exchange written submissions in respect of:
(i) the apportionment and summary assessment of costs;
(ii) the other party's schedule of costs; and
(iii) any associated matters arising under CPR Part 36 (if applicable).
(c) By 4pm on 10 December 2021 the Claimant and the Defendant shall each file and simultaneously exchange their responses to the other party's written submissions.
(d) The written submissions referred to at paragraphs 5(b) (NB: a formatting error occurred here in the order, but the meaning is clear) and 5(c) above shall in each case be limited to no more than 8 pages.
(e) The court file shall thereafter be referred to HHJ Pearce for determination of the issues.”
It follows that this judgment is concerned both with the incidence and the amount of costs. Matters are further complicated by the fact that LCB contends that it has obtained a better result than an offer that it had made during the course of the proceedings and therefore is entitled to the benefit of the provisions of CPR Part 36.
For the purpose of dealing with these issues I have the following documents/bundles:
7.1 From Huntsworth:
A summary of incurred costs dated 12.11.21
Costs submissions comprising 8 pages prepared by Mr Benedyk of counsel and dated 26 November 2021
A single page document containing two tables proposing an apportionment of costs on the basis that Huntsworth recover 55% of the total costs
A draft order relating to costs
A bundle headed “Correspondence Bundle”
A statement of costs totalling £16,428.27 relating to the Claimant's application to transfer to the shorter trials scheme
A statement of costs totalling £9,440 relating to the Claimant's specific disclosure application
Reply submissions comprising 8 pages prepared by Mr Benedyk of counsel and dated 14 December 2021
Bundle entitled “costs bundle” comprising 18 pages of extracts from Costs and Funding following the Civil Justice Reforms Questions and Answers, 7th Ed, Zuckerman on Civil Procedure Principles of Practice and Friston on Costs
7.2 From LCB:
Statement of costs in the form of Precedent H
Costs submissions comprising 45 paragraphs over 8 pages, neither signed nor dated
A draft order
A bundle comprising 327 pages headed “Bundle Index for Defendant's Costs Submissions”
Costs submissions comprising 32 paragraphs over 8 pages, again neither signed nor dated but clearly prepared in reply
A copy of the judgment in Pallet v MGN [2021] EWHC 76
The bundle prepared by the Defendant contains a copy of the draft judgment that I sent out. It should not do. The draft is clearly marked confidential. I shall refer not to the draft of the judgment in the bundle but rather the finalised judgment as handed down.
I also have available the trial bundle and the court file, which it has been necessary to access in order to check earlier version of the Statements of Case prior to amendment.
HUNTWORTH'S POSITION
In summary, Huntsworth contends as follows:
10.1 This is a paradigm case for an issue-based costs order;
10.2 The Claimant won on issues 2, 3, 5, 9 and 10 as identified above;
10.3 The costs referable to those issues are in all about 55% of the total costs of the claim;
10.4 Accordingly Huntsworth should recover 55% of its costs of the claim, a total of £94,482;
10.5 Alternately Huntsworth should recover a proportion of its costs of the claim, namely 55% or £94,482;
10.6 The Defendant did not make a valid Part 36 offer to which the court can or should give effect;
10.7 The Defendant unreasonably approached the issue of mediation;
10.8 In so far as it obtains a costs order in its favour, the Defendant's costs in its schedule are excessive;
10.9 The costs to which LCB is entitled on an issues based costs order in respect of issues where Huntsworth was not successful (that is to say all other issues other than 2, 3, 5, 9 and 10 as defined above) is 45% of its reasonable and proportionate costs, that is £87,592.50.
10.10 Alternatively LCB should recover a proportion of its reasonable and proportionate costs of the claim, namely 45% or £87,592.50;
10.11 There have been several costs orders made during the course of proceedings to which effect needs to be given by determination of the incidence of costs and assessment of the amount of such costs, namely:
(a) The order of HHJ Pelling QC of 16 July 2020 at E266 providing that Huntsworth shall pay the reasonable costs of and...
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