Case Nos: A3/2010/0919 & A3/2010/0926

Neutral Citation Number: [2011] EWCA Civ 523
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEEN’S BENCH DIVISION
COMMERCIAL COURT 
MR JUSTICE HAMBLEN
[2010] EWHC 641 (Comm)
Royal Courts of Justice
Strand, London, WC2A 2LL

Date:  11 May 2011
Before :

LORD JUSTICE RIX
LORD JUSTICE WILSON
and
LORD JUSTICE STANLEY BURNTON
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Between :

	(1) EHSANOLLAH BAYAT
(2) TELEPHONE SYSTEMS INTERNAITONAL INC. (A COMPANY INCORPORATED IN NEW JERSEY, USA)
(3) AFGHAN WIRELESS COMMUNICATIONS COMPANY  (A COMPANY INCORPORATED IN AFGHANISTAN)
(4) MARK WARNER	

Defendants/ Appellants 	
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	(1) LORD MICHAEL CECIL
(2) STUART BENTHAM
(3) ALEXANDER GRINLING
(4) JOAKIM LEHMKUHL	

Claimants/ Respondents	
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Robert Miles QC, Richard Hill and Gregory Denton-Cox (instructed by Paul, Hastings, Janofsky and Walker (Europe) LLP) for the First, Second and Third Appellants
Robert Miles QC and Richard Hill (instructed by Stephenson Harwood) for the Fourth Appellant
Nicholas Strauss QC and Michelle Menashy (instructed by McGuire Woods London LLP) for the Respondents

Hearing dates: 6 and 7 December 2010
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 COSTS JUDGMENT

Lord Justice Stanley-Burnton : 
1.	This is the judgment of the Court on the costs issues that were left over in our judgment handed down on 18 February 2011.
2.	We have considered the parties’ written submissions.
3.	The Appellant Defendants are entitled to their costs of the appeal, on which they were successful. Those costs will to be determined by detailed assessment on the standard basis in default of agreement. 
4.	The Appellants are not entitled to any costs of their unsuccessful application for permission to appeal on the issue of forum.
5.	So far as the costs of the applications heard and determined by Hamblen J are concerned, the Appellant Defendants should have succeeded on the issues that were successfully appealed, and they succeeded on issues such as the claims against the Third Defendant. The Respondent Claimants succeeded on the issues on which the greater costs were incurred, but their success was inconsequential due to their failure on the issues determined on appeal to this Court. We do not think that the fact that the Appellants sought to have the issues as to extensions of time and service determined as preliminary issues should affect the order for costs: Hamblen J’s decision to hear all issues was an unimpeachable case management decision. The order for costs should reflect the fact that overall the Respondent Claimants failed: in other words, no costs should have been incurred by the Appellants. In our judgment, in these circumstances the appropriate order for costs below is that the Respondents pay one third of the Appellants’ costs to the date of the order of Hamblen J dated 29 March 2010, to be determined by detailed assessment on the standard basis in default of agreement.
6.	Save as otherwise set out above, the Appellants are entitled to the costs of the claim, to be determined by detailed assessment on the standard basis in default of agreement.
7.	The Respondents will be ordered to repay to the Appellants’ solicitors within 7 days the sum of £375,000 paid pursuant to the order of Hamblen J together with interest on that sum at 1 per cent above Bank of England Base Rate from the dates of payment (being 19 April 2010 in respect of the sum of £75,000 and 17 May 2010 in respect of the sum of £300,000) until the date of repayment.
8.	The Respondents will pay to the Appellants interest on the costs payable by the Respondents under this order from the dates of payment of such costs by the Appellants to their solicitors at 1 per cent above Bank of England Base Rate to the date of this order, and thereafter on those costs after taking into account the sums paid under paragraph 9 of this order at the Judgment rate.
9.	We shall make interim orders that the Respondents pay within 28 days
(a)	to the solicitors for the First, Second and Third Appellant Defendants  the sum of £500,000 on account of their costs;
(b)	to the solicitors for the Fourth Appellant, the sum of £20,000.