Gordon Exall's blog on the recent case of Optimares SpA v Qatar Airways Group QCSC [2022] EWHC 2507 (Comm) is a helpful reminder that weak claims and inappropriate conduct can result in an award for indemnity costs against the losing party.
In this case, it was the Claimant who lost, and of whom it was stated that "Optimares pursued the claim on all issues despite the weakness of its construction arguments" and that it "conducted its claim with an insufficient regard to proportionality or reasonableness, which gave rise to the incurring of substantial costs on both sides".
In deciding to award costs on the indemnity basis, Mr Justice Calver referred to the case of Excalibur Ventures LLC v Texas Keystone Inc [2013] EWHC 4278 (Comm) in which Christopher Clarke LJ referred to the case of Balmoral v Borealis UK Limited [2006] EWHC 2531 and his own judgment in that case. Christopher Clarke LJ held, in those cases, that, in order for indemnity costs to apply, there had to be a departure from the norm, either in the conduct of the Claimant or in the circumstances of the case.
In Balmoral, LJ Clarke cited the case of Three Rivers District Council v The Governor & Company of the Bank of England [2006] EWHC 816 in which Tomlinson J gave examples of circumstances which took the case out of the norm. They were when a claimant:
"(a) advances and agreessively pursues serious and wide-ranging allegations of dishonesty or impropriety over an extended period of time.
(b) advances and aggressively pursues such allegations despite the lack of any foundation in the documentary evidence for those allegations and maintains the allegations without apology to the bitter end.
(c) actively seeks to court publicity for its serious allegations both before and during the trial.
(d) turns a case into an unprecedented factual inquiry by the pursuit of an unjustified case.
(e) pursues a claim which is to put it most charitably thin, and in some respects far-fetched.
(f) pursues a claim which is irreconcilable with the contemporaneous documents.
(g) commences and pursues large scale and expensive litigation in circumstances calculated to exert commercial pressure on a defendant and during the course of the trial of the action the claimant resorts to advancing a constantly changing case in order to justify the allegations which it had made, only then to suffer a resounding defeat.”
Gordon Exall's blog and links to the relevant case law can be found here: Optimares SpA v Qatar Airways Group QCSC [2022] EWHC 2507 (Comm)