Brian May, lead guitarist of Queen and keen astrophysicist, has recently learned that costs in civil claims can be almost as crazy as love, sometimes even more so.
Brian brought a claim against his neighbour because his neighbour was building a ‘super basement’ and Brian complained that the works were too noisy (otherwise known as a private nuisance claim). The claim was settled and Brian received £25,000 from his neighbour.
The settlement also included a term whereby Brian’s neighbour agreed to pay Brian’s legal costs. This was on the usual basis that the court would decide how much should be paid if the parties could not reach an agreement.
Brian’s costs however were unusually high, totalling a whopping £208,236.54!! Agreement could not be reached and the court was asked to consider how much should be paid. The hearing took place on 16 June (May v Wavell Group plc).
Brian’s costs bite the dust
When assessing the level of costs a successful party should receive, the court is required to consider whether those costs are proportionate with reference to the following 5 factors:
- the sums in issue in the proceedings;
- the value of any non-monetary relief in issue in the proceedings;
- the complexity of the litigation;
- any additional work generated by the conduct of the paying party; and
- any wider factors involved in the proceedings, such as reputation or public importance.
The court did not think that Brian’s claim was particularly complex or high value and, taking the above into account, it drastically reduced Brian’s costs to £35,000 plus VAT.
When reaching this decision the court rejected the principle that costs should be reduced to the minimum amount required to successfully bring the claim. Instead, the court held that in circumstances where the claim is straightforward and the sums in dispute are modest, that approach could still be too generous to the successful claimant. In these circumstances the court held that a successful party might only recover a contribution to their costs.
This case highlights the importance of considering proportionality at an early stage, preferably before significant costs are incurred. It clearly made no sense for Brian to spend £208,000 to recover a total of £60,000! If it looks like disproportionate costs could be incurred a solicitor should advise his client in very clear terms that they might only recover a fraction of their costs. In those circumstances the client should strongly consider alternative, less costly means of resolving the dispute, such as mediation and other forms of alternative dispute resolution.
You have to ask whether Brian was properly warned of the costs risks in this case. Perhaps he was, and simply said to his solicitors ‘don’t stop me now’.
Jeremy Crook is a solicitor in the dispute resolution team in St Austell. If you would like to contact Jeremy, then please call 01726 74433 or email email@example.com.