A senior costs judge was wrong to apply the new proportionality test to success fees and after the event (ATE) insurance premiums, the Court of Appeal has unanimously held in a privacy case brought by a primary school teacher whose relationship with a premiership footballer was exposed by the Sunday People newspaper.
In BNM v MGN [2017] EWCA Civ 1767, MGN argued that the new proportionality test applied as success fees and ATE premiums could be regarded as ‘fees’ and ‘expenses’, and therefore fell within the definition of costs.
However, the Court of Appeal held that the senior costs judge should have used the proportionality test under the old Civil Procedure Rules.
A statement from Temple Garden Chambers, where barristers represented BNM, said: ‘The Court of Appeal held that the senior costs judge had not sufficiently made clear what, if any, weight he had attached to certain criteria relevant to this point and thus directed him to reconsider the issue in the light of their further guidance.’
NLJ colmnist Dominic Regan said: ‘It was hoped that general guidance upon proportionality would be forthcoming. It wasn’t. Very annoying and disappointing. A cross-appeal was allowed; had the claimant issued proceedings unnecessarily? Bizarrely, Irwin LJ in the last sentence of the judgment stated that there was more than one answer to that question.’
Francis Kendall, vice-chairman of the Association of Costs Lawyers, said: ‘It is disappointing that the court chose not to give any guidance on the application of the new proportionality test, but we understand that three conjoined cases are set to come before the court shortly that will hopefully be a vehicle for such guidance.
‘The disputes the continuing uncertainty is causing are not helpful and we urge the Court of Appeal to give the profession the strong steer it needs.’
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