Before : |
Advocate Matthew John Thompson, Master of the Royal Court. |
Between |
Monteagle International Limited |
First Plaintiff |
|
Monteagle International (UK) Limited |
Second Plaintiff |
And |
Grocery Market Research Limited |
First Defendant |
|
Anthony Dumas |
Second Defendant |
Advocate J. Harvey-Hills for the Plaintiffs.
Advocate M. L. A. Pallot for the Defendants.
CONTENTS
|
|
Paras |
1 |
Introduction |
1-2 |
2 |
Submissions |
3-21 |
3 |
Decision |
23-33 |
4 |
Overall conclusion |
33-39 |
judgment
the MASTER:
1. This judgment contains my decision on costs following on from my substantive judgment in this matter dated 23rd November 2020 reported at Monteagle International Limited and Anor v Grocery Market Research Limited and Anor [2020] JRC244.
2. This judgment has been decided on the papers following written submissions received from the defendants dated 23rd December 2020 and the plaintiffs' reply filed on 11th January 2021.
3. The parties' submissions followed an email by me where I gave an initial indication that I thought the defendants had had the better of the argument even if they had not been successful on every point, leading to a suggestion that a costs order should be made in the defendants' favour on the standard basis albeit with some reduction. I made it clear however that these observations were to assist the parties only and that I would hear any arguments on costs that any party required me to determine.
4. In light of these observations Carey Olsen for the defendants therefore wrote to Mourant Ozannes for the plaintiffs arguing that the plaintiffs should pay 60% of the defendants' costs on the standard basis.
5. The plaintiffs responded on 30th November 2020 arguing that:-
(i) the defendants should pay the plaintiffs' costs of the application in respect the inspection of the Omni Model and pay a percentage of the costs of the requests for further information;
(ii) as an alternative the defendants should pay an overall percentage of the plaintiffs' costs of the application as a whole.
6. Notwithstanding these alternatives, the plaintiffs proposed costs in the cause. This offer was rejected.
7. In their written submissions, the defendants analysed the application brought by the plaintiffs as raising two issues:-
(i) Requests for further information of the answer; and
(ii) A request for disclosure of the Omni Model.
8. The defendants contended that the application in respect of the information requests was substantially a failure because, of the 47 requests made, only 4 were granted and on a limited or partial basis.
9. In respect of the Omni Model, the defendants maintained that the disclosure request was premature and disproportionate and was not necessary to enable the plaintiffs to plead any reply and answer to the answer and counterclaim. The defendants repeated their submissions made at the hearing that these requests were therefore an exercise designed to generate unnecessary expense for the defendants at this early stage.
10. The defendants also criticised the plaintiffs' approach in relation to costs, which approach the defendants contended was a further attempt to draw out and litigate this dispute.
11. This therefore led the defendants to ask for their costs to be paid in full followed by a summary assessment or failing that a taxation.
12. The plaintiffs in their response agreed that two main issues had been raised and in respect of the requests for information repeated the classification of their requests for information as set out in paragraph 12 of the substantive judgment which I adopted in reaching that decision.
13. The plaintiffs further argued that inspection of the unique pricing model was one of two main issues and was much more involved from a legal perspective than the other issues raised by the application. The plaintiffs therefore argued that around 1/3 of the time spent related to this issue, by reference to both the skeleton arguments filed and the substantive judgment. The plaintiffs further disputed that this part of the application was a cynical one and instead contended that it was squarely based on documents being referred to in a pleading.
14. The plaintiffs also relied on Mourant Ozannes letter of 31st July 2020 where the plaintiffs offered the use of a confidentiality club which request was rejected by Carey Olsen in their letter of 10th August 2020, which position was confirmed by Carey Olsen's reply of 18th September 2020.
15. The plaintiffs also criticised the defendants' approach to compliance with the orders I made. However, I did not regard this as being relevant to the question of what costs order I should make.
16. In respect of the requests for information, in relation to requests that related to the unique pricing model, the plaintiffs argued that these were also successful because they were part and parcel of the court ordering discovery.
17. In respect of issues of foreign government law (category 3), the plaintiffs criticised the defendants for not explaining the position that was set out at the hearing earlier, and in particular in the defendants' responses to the requests for further information supplied on 4th September 2020.
18. In relation to the requests concerning particulars of the agreements, the plaintiffs argued that four were granted, eight were duplicative of those granted and eight were rejected leading to the submission that the plaintiffs now had answers to the majority of points raised as a result of the application. The plaintiffs also emphasised that the requests where the plaintiffs were successful were the most important. The plaintiffs again also contended that the answers subsequently filed led to new significant matters being pleaded. However, again I do not regard what happened after the hearing as relevant.
19. In respect of the nature of the interest claimed, the plaintiffs' position was that while they were unsuccessful at the hearing, the important factor was the concession given by the defendants at the outset which would not have been elicited absent the application.
20. As a conclusion to these submissions, the plaintiffs therefore contended that they should be awarded around 60% of their costs because it was appropriate to approach matters on an issue basis. In respect of the Omni Model they were successful on about 35% of the case and by adding categories 3 and 4 these issues together amounted to close to 60% of the application.
21. The plaintiffs also argued that their offer of costs in the cause which had not been accepted was more than a reasonable offer.
22. Finally, the plaintiffs argued that if the defendants were successful and a summary assessment was required, directions were needed in order to allow the plaintiffs an opportunity to make comment.
23. In respect of the approach to be taken, both parties' submissions approached the assessment of costs on an issue basis (see Booth v Collas Crill [2017] JRC038). I consider they were correct to do so in this case.
24. To evaluate their submissions, I also consider it necessary to revert to the substantive judgment and my recollection of what happened at the hearing itself.
25. In the judgment I approached matters in the order set out in paragraph 12 of the substantive judgment. My recollection is that the majority of the hearing was taken up dealing with and going through each of the requests relating to the nature of the interests claimed by the defendants and the particulars of agreements.
26. In relation to the nature of the requests claimed by the defendants, 18 requests were made. Of these I ruled that 15 were not necessary and 3 were also duplicative. I did not therefore grant any of the requests in relation to this category.
27. I also stated the following at paragraph 29 of the substantive judgment:
"I also wish to add, if there was any doubt on the part of the plaintiffs and their advisers, they could have addressed that doubt by seeking the same clarification that I sought at the outset of the hearing, rather than making 18 separate requests. The approach taken in respect of this category was therefore disproportionate because it was not concisely confined to matters to enable the requesting party to understand the case it faced. The filing of 18 requests was also a costly way of seeking a clarification that was ultimately straightforward to ask for and was readily given."
28. Although the plaintiffs argued that, had they made such a request it would have been refused, the fact is they did not do so and instead served a whole series of requests supported by a detailed skeleton argument which the defendants and the court had to consider. What might have happened is not therefore relevant to the question of what costs order to make. I can only deal with what did happen.
29. On this issue I therefore conclude that the defendants were the clear winner.
30. In relation to the requests concerning the arrangements, agreements or understandings, 20 requests were made of which I granted 4, albeit some in part. As noted by the plaintiffs 8 were refused as not being necessary and another 8 were also refused as being duplicative. I do not however accept the submission by the plaintiffs that they were successful on the majority of these requests. The flaw in this approach is to allow the plaintiffs to recover their costs of duplicative requests. As noted at paragraph 18 of the substantive judgment, Rule 6/15 of the Royal Court Rules 2004, as amended, should not open the floodgates to numerous or lengthy requests. At paragraph 21 of the substantive judgment I referred to Booth v Collas Crill and the importance of requests being put much more "plainly and simply". Mourant Ozannes acted for Collas Crill in that case and so were clearly on notice of the approach I required. Issuing a large number of duplicative requests which were refused does not meet the plain and simple approach. This was noted at paragraph 47 of the substantive judgment where I observed "the plaintiffs have fallen into the trap of making requests of specific paragraphs without looking at the pleading or the paragraph as a whole. The limited points of clarification I have ordered to be provided could also have been dealt with on a much more straightforward basis."
31. Again therefore, for this category I regard the defendants as the clear winner.
32. In respect of issues of foreign/governing law, both parties can be criticised. As noted in the substantive judgment these were foreign law agreements, but the plaintiffs had not pleaded that the agreements were governed by a foreign law. In my judgment if an agreement is expressly governed by foreign law, a pleading should make that clear. If it is a party's case that nothing turns on the agreement being pleaded by a foreign law i.e. the foreign law is no different from the law of Jersey, then that should also be made clear. Such an approach in the future will assist other parties and the court to narrow down where there is an issue of foreign law in dispute requiring determination. Equally however criticism can be made against the defendants for not making their position clear until the hearing despite being asked to do so by the plaintiffs prior to the hearing. In the round I therefore regard the result on this issue as something of a draw.
33. In respect of the unique pricing/business model issue, it was dealt with at the end of the hearing and did not take up a significant amount of time because I ultimately determined that a discovery order was required albeit subject to a confidentiality club. However, in relation to the outcome of this part of the application, because the plaintiffs had previously offered a confidentiality club which offer was rejected, the plaintiffs are clearly the successful party on this particular issue. However, it is right to remind myself that I did not order the defendants to plead the unique pricing model, but rather approached the issue as one of discovery of a document referred to in a pleading for the reasons set out at paragraphs 57 and 58 of the substantive judgment.
34. Having ruled that in respect of two issues the defendants were clear winners, in respect of one issue that the outcome was something of a draw and in respect of the final issue the plaintiffs were in overall terms successful, the question then has to be asked as to what this means in terms of an overall costs order. This requires me to evaluate what proportion of the application related to each of the different issues that were before me. However, as noted above, in my judgment, the vast majority of the requests and the material before me, including the skeleton arguments, related to the nature of the interests claimed by the defendants and particulars of the agreements. 47 separate requests had to be reviewed in written and oral submissions. Issues of governing law were dealt with quickly and the issues in relation to the unique pricing model ultimately came down to whether or not a confidentiality club should be ordered and if so on what terms.
35. While my indication to the parties was an instinctive reaction following the release of the substantive judgment, my evaluation of the detailed submissions received from both counsel does not alter that indication so my view is still that the defendants have had the better of the argument. This conclusion also means that neither costs in the cause, nor a costs order in the plaintiffs' favour, are appropriate outcomes.
36. As to what costs order I should make in the defendants' favour, I have to take into account the fact that the plaintiffs were successful in obtaining discovery of the unique pricing model and the issue in respect of foreign law was something of a draw.
37. Where this leads me to is that the defendants' original offer of 60% does not quite reflect the justice of the application and is a little too much in the defendants' favour. I therefore consider that an order requiring the plaintiffs to pay 50% of the defendants' costs is a more appropriate outcome with each side otherwise bearing their own costs. The basis of the costs ordered is the standard basis.
38. I will also assess such costs summarily. The defendants shall therefore provide a schedule of costs claimed (in summary form only) with the plaintiffs providing their observations within a further 7 days.
39. However, the plaintiffs shall pay the costs of the costs application in full as their best offer was costs in the cause whereas the defendants' proposal was much closer to the final order I have made.
Authorities
Monteagle International Limited and Anor v Grocery Market Research Limited and Anor [2020] JRC244
Booth v Collas Crill [2017] JRC038
Royal Court Rules 2004, as amended