IN THE HIGH COURT OF JUSTICE
London EC4A 1NL
B e f o r e :
| VARIOUS CLAIMANTS
(1) John Leslie
(2) Chantelle Houghton
|- and –
George McDonald (instructed by RPC LLP) for the Defendant
Hearing dates: 8 and 9 May 2018
Crown Copyright ©
Chief Master Marsh:
(1) The order dated 9 July 2015, in a similar way to a GLO, distinguishes between "Individual Costs" and "Common Costs" (these are defined terms). The costs of the litigation fall to be allocated between those two areas and, in the event of doubt, allocation is to be dealt with by the court.
(2) The order dated 16 May 2016 set up a system for costs management by the application of Template Costs Budgets that were to follow, as far as possible, the layout of Precedent H. The template system applies not only to Individual Costs but also to Common Costs. It was a way of avoiding the need for the court to undertake multiple costs management hearings in similar claims.
(3) There are three categories of template for Individual Costs; A, B and C. For present purposes, the distinction between them does not matter. It suffices to note that the two claims in relation to which the court is asked to undertake a more detailed costs budgeting exercise, Leslie and Houghton, were Template C cases, meaning cases in which there is at least one admission of the misuse of private information and the number of articles complained about exceeds 20.
(4) The order dated 16 May 2016 also permitted any party to apply to the court for an order that a "Bespoke Individual Budget" could be approved by the court in place of the applicable Template Budget.
(5) The order dated 21 July 2016 recorded that the 2nd Wave claimants had agreed the Defendant's Costs Budgets, as they are defined in the fourth recital to that order. Paragraph 2 of the order determined the approach to be adopted by the court in dealing with the claimants' costs budgets. It requires the court to "approve the estimated base costs in accordance with paragraph 7.3 of PD3E" and it permits the court to comment on incurred base costs in accordance with paragraph 7.4 of PD3E. Directions were given in the order for setting up a cost management hearing.
(6) The order dated 1 November 2016 provided a number of refinements to the costs budgeting system set up under previous orders. I was told that at around November 2016 there were about 120 claims on the 2nd Wave register.
Individual Bespoke Costs Budgets for Mr Leslie and Ms Houghton
(1) The court has no power to approve the costs of budget phases that have been agreed between the parties.
(2) Where budget phases are not agreed, the court will review them and approve the budget with appropriate revisions.
(3) The court's approval is to the total figure for the budget phases but the court may have regard to the constituent elements of each total figure.
(4) The court will not undertake a detailed assessment in advance.
(5) The court will consider whether the budgeted costs fall within the range of reasonable and proportionate costs.
"Costs incurred are proportionate if they bear a reasonable relationship to –
(a) the sums in issue in the proceedings;
(b) the value of any non-monetary relief in issue in the proceedings;
(c) the complexity of the litigation;
(e) any wider factors involved in the proceedings, such as reputation or public importance."
(1) Mr Leslie's budget for investigation and pre-action disclosure is £77,000. Ms Houghton's is much less, £5,000.
(2) The incurred costs on disclosure up to the date of the January 2018 budgets were respectively £82,000 and £9,000.
(3) The estimated sums for disclosure in those budgets were £98,000 and £47,000.
(4) The totals for incurred and estimated costs were £180,000 and £56,000.
(5) The revised budget for Mr Leslie records that by 2 May 2018 incurred costs on disclosure had reached £197,000 and further costs were estimated at £85,000. The total budgeted costs, before adjustment by the court, for Mr Leslie are now £282,000.
(6) The aggregate volume of documents that have been disclosed (so far) by the parties can be fitted within 15 lever arch files. This includes six lever arch files of additional disclosure relating to the board knowledge issue.
"… it will be necessary for the claimant to explain what happened and why MGN's senior management could and should have taken numerous steps."
(1) It is not in dispute that these are 'two counsel' claims. However, Mr Sherborne has not taken silk and there is no good reason to budget his fees as if he had.
(2) Mr Sherborne's brief fee, broken down using an hourly rate of £400 per hour, involves him charging for an astonishing 625 hours of work in preparation for a 15 day trial. Allowing for a 10 hour day this amounts to 62 days of work (52 days if he were to charge for 12 hour days). It is difficult to conceive these are genuine periods.
(3) Curiously, Mr Santos has been budgeted to spend much less time on the brief than Mr Sherborne (375 hours).
(4) Daily refreshers of £5,000 for Mr Sherborne and £2,000 for Mr Santos are high.
(1) Apportionment of counsels' fees for the trial between individual and common costs
(2) Costs of the 12 January 2018 PTR
"16. Save for the costs of the Specific Disclosure Application and the costs dealt with in paragraph 4 of this order, the costs of and occasioned by this Pre-Trial Review and the costs of and occasioned by all other applications determined at this Pre-Trial Review shall be costs in the case.
17. The question of whether any of the costs dealt with by paragraph 16 of this order are to be 2nd Wave Common costs rather than Individual Costs is reserved. Chief Master Marsh may deal with this issue if he is able and minded to deal with it. If the Chief Master is not so minded, the question shall be determined at the 15th CMC."
(3) Costs of the CCMC: individual or common costs?
"7. "Individual costs" are those costs incurred for and/or in respect of any Individual Claimant within the Managed Litigation of MNHL in relation to matters which are particular and personal to each such Claimant, save insofar as they are 2nd Wave Common Costs or are deemed to be 2nd Wave Common Costs or are Common Costs (as defined in the order of Mr Justice Mann dated 4th August 2014) or are deemed to be Common Costs.
8. "2nd Wave Common Costs" means:
a. all costs of the 2nd Wave of the MNHL other than Individual Costs;
b. Costs (which are not Individual Costs) incurred by: (1) the Lead Solicitor; (2) Counsel instructed by the Lead Solicitor and the costs arising therefrom; (3) other solicitors (and costs lawyers) authorised or instructed by the Lead Solicitor, in relation to any interim or procedural hearing in the Chancery Division relating to the second trial, or in the second trial itself, or relating to the second wave of the Managed Litigation generally (whether designated as a case management conference, cost management conference, pre-trial review, summary assessment or payment on account of common costs, or otherwise, and whether comprising or including any application against one or more respondents who are not parties), save where expressly ordered to the contrary;
g. Costs incurred by: (1) the Lead Solicitor; (2) counsel instructed by the Lead Solicitor and the fees arising therefrom; (3) other solicitors (and costs lawyers) authorised to instructed by the lead solicitor for the purpose of budgeting second wave common costs and/or budgeting any template individual costs budgets and/or coordinating the budgeting of individual costs; and
h. Costs incurred by: (1) the Lead Solicitor; (2) counsel instructed by the Lead Solicitor and the fees arising therefrom; (3) other solicitors (and costs lawyers) authorised to instructed by the lead solicitor for the purpose of estimating, reporting, negotiating and/or assessing second wave common costs."