Development – Property companies – Redevelopment interfering with right to light – Court awarding damages in lieu of injunction in respect of only one alleged infringement – Whether defendant liable for all claimant’s costs – Claim allowed in part
The High Court held that the defendant had been liable for a small infringement of the claimant’s right to light when it demolished a single-storey flat-roofed building and erected a T-shaped three-storey building with a pitched roof. The claimant had sought an injunction that would have required the demolition or redesign of part of the building. However, the court ruled that the injury to the claimant could be estimated in monetary terms and compensated adequately by a small money payment. The court held that it would be oppressive to the defendant to grant a mandatory injunction that would cause it loss that would be out of proportion to any loss that the claimant might suffer: see [2006] 41 EG 226.
The matter subsequently came before the court for an assessment of damages in the sum of £50,000: see [2007] EWHC 212 (Ch); [2007] PLSCS 29.
There was no dispute that the defendant had to pay the claimant’s costs of the assessment of damages. However, a question arose as to whether it was liable for the costs prior to and during the trial on the merits of the case.
Held: The claim was allowed in part.
The starting point on the question of costs was to identify the “winner”, since the general rule was that the unsuccessful party had to pay the successful party’s costs: AL Barnes Ltd v Time Talk (UK) Ltd [2003] EWCA Civ 402 and Day v Day [2006] EWCA Civ 415 applied.
However, the court had the power, in its discretion, to make a different order, having regard to: (i) the conduct of all the parties; (ii) whether a party had succeeded on part of its case, even if it had not been entirely successful; and (iii) any payment into court or admissible offer to settle made by a party that was drawn to the court’s attention (whether or not made in accordance with Part 36): see r 44.3(2)(b) and 44.3(5) of the Civil Procedure Rules 1998 (SI 1998/3132).
Bearing in mind that: (i) the claimant had won the case; (ii) it had to bring and continue the litigation to its end in order to vindicate its rights; (iii) the defendant had refused an offer under Part 36 and other offers to settle; and (iv) the eventual award of damages was not matched by any counter-offer, the claimant was entitled to most of its costs despite having lost most of its arguments and having pursued relief that would have been oppressive to the defendant.
On the other hand, in the light of the special features in this case, the claimant should not have all its costs and should not have any of them on the indemnity basis that it had sought. In particular, there should be an incentive on claimants to moderate the relief sought when the facts showed that the granting of such relief would be oppressive to the other party.
Overall, justice would be done if the claimant received 75% of its costs up to and including the trial and handing down of the judgment on the merits and the entirety of its costs in relation to the assessment.
Mark Wonnacott (instructed by Ashford, of Exeter) appeared for the claimant; Philomena Harrison (instructed by Davenport Lyons) appeared for the defendant.
Note: The decision was affirmed by the Court of Appeal on 15 November 2007
Eileen O’Grady, barrister
