October 21, 2024
By Siôn Fôn
Here Darwin Gray’s commercial disputes expert, Siôn Fôn, looks at the lessons that can be learned from this case.
What happened?
After Mrs Vardy lost her libel case in 2022 the Judge ordered her to pay 90% of Mrs Rooney’s legal costs, which was initially budgeted at £540,000.
Since then, the amount has risen to £1.8m, which Mrs Vardy’s barrister said was disproportionate and over three times higher than Mrs Rooney’s initial budget. This led to Mrs Vardy’s legal team accusing Mrs Rooney’s lawyers of “knowingly misleading” Mrs Vardy and the court by “deliberately” downplaying their legal costs. Mrs Vardy’s legal team claimed that this constituted “serious misconduct” and should warrant a reduction of the payable amount.
Mrs Rooney’s team responded saying that there had been no misconduct and they had not misled anyone.
What did the Judge decide?
At the costs hearing, the Judge found that Mrs Rooney’s lawyers had on balance and “only just”, not committed misconduct, therefore, it was not an appropriate case for him to reduce the costs that Mrs Vardy must pay. He said that whilst there had been a failure to be transparent it was not sufficiently unreasonable or improper enough to be considered misconduct.
What does this mean for you?
In court proceedings the unsuccessful party usually must pay the other side’s reasonable and proportionate legal costs. However, each case turns on their own facts and different cost rules apply to different types of claims.
Usually, parties in high-value claims have budgets which must be strictly adhered to pending any reasonable adjustments. It is very important to have a clear budget at the outset of matters and communicate to the Court once that budget has been exceeded. It is the Judge’s discretion to ultimately decide the final amount payable.
The Court expect the parties and their representatives to be transparent and clear about the costs incurred and budget accordingly. Litigants are expected to carefully consider the legal and commercial risks they face and balance them with the potential benefit to them if they succeed, that way they are able to decide if the claim should proceed to trial.
If you are looking to bring a case in the courts it is important for you to appreciate that you may have to pay the other parties’ costs, which could end up being much higher than anticipated, as well as your own.
If you wish to discuss issuing a legal claim and the likely costs involved with a claim, do not hesitate to contact our commercial disputes experts for a free no-obligation call on 01248 301 100 or contact us via our Contact Form.
