News in brief 19 January 2017

Kendall tops poll

Francis Kendall has retained his seat on the ACL Council after winning the four-way election. Mr Kendall, a partner at London costs firm Masters, said: “I am grateful for the support of the membership and looking forward to continuing to improve and raise the profile of the Association.”


Court makes up exchange rate loss on costs award

In what appears to be a novel ruling, the High Court has awarded a successful German claimant an extra £20,000 to compensate for its exchange rate loss on payments to its solicitors, particularly in light of the significant fall in the value of sterling against the euro since the EU referendum result.

According to City firm Herbert Smith Freehills, which reported on Elkamet Kunststofftechnik GmbH v Saint-Gobain Glass France S.A. [2016] EWHC 3421 (Pat), Mr Justice Arnold conducted a summary assessment of the successful claimant’s costs in a patent case that had proceeded in the shorter trials pilot scheme. The claimant had been awarded 90% of its costs of the invalidity issues and 100% of the costs of infringement, to be assessed on the indemnity basis. It was common ground that an average figure of 93.5% was appropriate in terms of the percentage of the claimant’s overall recovery. The judge awarded a figure of £458,000.

The firm’s briefing note said: “The judge noted that the court has, and regularly exercises, the power to award interest on costs in order to compensate the successful party for being kept out of its money. He also noted that, since the decision of the House of Lords in Miliangos v George Frank (Textiles) Ltd [1976] AC 443, it has been possible for the English court to make orders for damages expressed in foreign currencies. He rejected the defendant’s submission that a costs order should be expressed in sterling regardless of the source of the funds from which the costs are to be paid, as that would be contrary to the principle underlying the decision in Miliangos.

“It followed as a matter of logic, the judge said, that where the court made an order in sterling, it ought to have power to compensate the receiving party for any exchange rate loss. The basic principle was that an order for costs is designed to compensate the successful party for its expenditure. If a foreign company had to exchange its local currency into sterling in order to pay costs as the litigation went on, then in principle it was entitled to be compensated for any additional expenditure incurred as a result of exchange rate losses in the same way as it was entitled to be compensated by way of interest for being kept out of the money.”


Late adjournment “did not warrant” indemnity costs

Costs were awarded in favour of the claimant on the standard basis where an imminent application had to be adjourned, according to a Lawtel report of Mrs Justice Asplin’s ruling in Global Energy Horizons Corp v Gray. She ruled that a last-minute change in the defendant’s legal team and a lengthy letter sent to the claimant on the last working day before Christmas raising serious allegations, although unfortunate, did not warrant indemnity costs.

The report said the judge found that all the circumstances needed to be taken into account to determine on what basis costs should be ordered and neither the change in legal teams nor the issues in the defendant’s letter being raised late took the matter outside normal costs principles.

This post was posted in ACL e-Bulletin

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Costs News
Published date
20 Jan 2017

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