A claimant that recovered just 2% of the sum it originally claimed at trial was not the successful party, the High Court has ruled.
Rotam Agrochemical Company was awarded €291,000 (£258,000) in damages for unjust enrichment, having initially sought $16.4m (£12.8m), later reduced to $11.3m (£8.9m) in the main for alleged breach of two contracts.
Mr Justice Butcher said the claimant had spent more than £1.5m in costs: “In reality, Rotam would not have incurred costs of that magnitude had the prize which they were seeking to win been the recovery which they ultimately made.”
Rotam argued that it was the successful party and should have its costs, subject to a reduction of no more than 25% to take account of its failure on some issues.
The judge said: “I consider that if a party, though ordered to pay a sum of money, has in reality and in substance won, it should be regarded as the successful party. In my judgment, in the present case it cannot be said, with any degree of plausibility, that Rotam won…
“By contrast it can be said that GAT, substantially and in reality won, and in particular that GAT substantially denied Rotam the prize which Rotam fought the action to win.”
Butcher J added that the aspect on which Rotam won was an alternative claim, which only succeeded on the basis that Rotam’s primary claim failed.
“As Mr Cuddigan QC for GAT put it, the claim in unjust enrichment was one which Rotam wanted to lose. This emphasises that it was not the prize which Rotam fought the action to win.”
He also dismissed Rotam’s suggestion that the absence of a part 36 or Calderbank offer was a factor in its favour.
“I consider that the correct date to judge when any offer might reasonably be expected to have been made was at the point that the claim in unjust enrichment was added to the particulars of claim in January 2017.
“While there had been reference to the sum paid to GAT in the original particulars of claim, it was not pleaded as a claim in unjust enrichment. By January 2017 significant costs had already been incurred by the parties in dealing with Rotam’s originally pleaded causes of action, which, as I have decided, were unfounded.
“A part 36 offer would have meant that GAT could not recover those costs. A Calderbank offer made by GAT at or after the time of the amendment to pay the amount of the enrichment plus the costs of that issue, but on the basis that Rotam should pay it the costs incurred in relation to the other causes of action, would undoubtedly have been rejected, and the making of such an offer would have been a ‘mere matter of ritual’, as it was put in Medway.”
However, though GAT was the successful party, the judge said there were significant parts of the case on which GAT did not prevail and so should only be entitled to led 50% of its costs.
Butcher J added: “For the sake of completeness I should state that, even had I been persuaded that, by reason of the fact that they were recipients of a sum of money pursuant to my judgment, Rotam were to be regarded as the successful party, I would nevertheless not have made an order that Rotam was to have their costs, or a substantial proportion of their costs, under CPR 44.2(2)(a), but would have made a ‘different order’ under CPR 44.4(2)(a), and I doubt that the overall result would have been significantly different from that which will follow from the order which I have made.”