Mr. Recorder Alastair Wilson QC:
- Following my recent judgment in the Defendants' favour in this matter ([2013] EWPCC 32 ), the following is my ruling on the issue of costs.
- This was a relatively simple matter in which the Defendants did not take any objection to the validity of the patent, but did take three non-infringement points:
a. The first related to the "notch", and divided itself into a number of subpoints, on one of which (relating to the shape of the notch) the Claimants succeeded, though the Defendants succeeded overall in relation to two different way of putting the point.
b. The second related to the direction in which the seat back would lower itself to the horizontal position. The Defendants lost on this point.
c. The third related to the question of whether the Defendants' device allowed the seat back to be raised to the vertical without interruption (the "geometry" point). On this point, the Defendants won in relation to their devices if they were not greased, but the Claimants won in relation to them if they were. The issue of whether any of the Defendants' goods were supplied greased would have been left to the enquiry as to damages, were it not for the Defendants' success on point a. above.
- In these circumstances the Claimants say that although the Defendants have clearly won the action, there should be a general discount to reflect the fact that they lost so many points. I do not agree. Dealing with points such as this is part of the process of educating the Court about the overall meaning of the Claim, and I do not consider that a Defendant, which had no choice but to defend itself, should be penalised in costs over points of this nature unless a lost point is improperly taken or has led to very significant additional expenditure. The second point certainly involved minimal expenditure. As to the third point, although products were brought to Court and inspected by me primarily for the purpose of dealing with that point, it is not clear who could be said to have won the point: had there been an inquiry as to the damages and it turned out that the Defendants' products were usually supplied with grease on them, it might be said that the Claimants had won the point, and vice versa. Clearly, however, it would be wholly disproportionate to try this issue merely to decide whether the Defendants' costs should suffer a small discount. Given that the inspection of the chairs was at least to some extent helpful anyway in gaining a general understanding of the case, and given also that the Defendants have won the action, albeit most convincingly on a different point, I do not consider it right to make a discount in respect of that point.
- Turning to more specific points, in accordance with current practice the Defendants' costs schedule has been broken down into the stages set out in CPR 45.41 and PD 45 – "Fixed Costs". Various issues have been raised by the Claimants in relation to the Defendants' Schedule.
Hourly rates
- The Claimants make a further general point relating to the hourly rates claimed in respect of by Duncan Curley and his assistant Harshad Karadbjahne. The Claimants contend that although Mr. Curley is a skilled solicitor advocate with an address in the City of London, his practice is only a small one, and its address is not far from the West End. As to the size of his practice, I have no idea whether expenses such as rent, rates and the hire of ancillary staff increases or decreases with the size of a solicitors' business. As to his address, the fact is that it is in the City. The Guidelines are, of course, no more than Guidelines, and it may be that armed with relevant data it would be possible to produce a more nuanced set of guidelines taking more account of the size of a solicitor's and his precise location. In the absence of revised Guidelines, the 2010 Guidelines are still in force. I see no pressing reason to depart from them in this case. Accordingly I will adopt the Guideline figure of £409 for Mr. Curley (as opposed to the £425 contended for by the Defendants). As to Mr. Karadbjahne, there was some justification in the Claimants' comment that he comes closer to a Category D practitioner than a Category C. He does not yet have full qualifications as a solicitor or a patent agent, and I note that an affidavit he made was largely drafted by Mr. Curley. In my view his hourly rate should be assessed at £126, that being the Guideline figure for "Trainee solicitors, paralegals or equivalent" in a City practice.
Defence and Counterclaim
- The Defendants claim a total of £11,108.85 for work done in relation to the preparation of the Defence. There was in the end no Counterclaim for Revocation, but the Defendants obviously had to investigate validity, and I note that the bulk of the work done under this head was done by Mr. Karadbjahne. The hours worked do not appear to me to be unreasonable, and even allowing for a reduction in the hourly rate as set out above, the resulting figure of £8891.43 is still well above the cap of £6,125. It might be said that in a case of this apparent simplicity the figure awarded should be somewhat less than the maximum of £6,125, but searches on mechanical patents, even simple ones, are always difficult, and non-infringement points need careful scrutiny. I do not consider it appropriate to award less than the cap of £6,125 under this head.
CMC costs
- The Defendants' costs schedule contains a figure for the application for the CMC, and a further figure for attendance at it. The Claimants contend that this constitutes double counting: the capped figure of £2,500 is intended to cover both the application for the CMC and the hearing of the application. I agree with the Claimants that the Rules do not contemplate that either party should be paid more than one maximum of £2,500 for the application for, and attendance at, the CMC. The Defendants say that they should never have had to make the application, and were put to the cost of writing several letters to the Claimants' solicitors reminding them that it was their responsibility to launch the CMC, and, in due course, the Defendants had to incur the expense of issuing the application itself. If the Rules do not make specific provision for compensating Defendants in such situations, then, the Defendants contend, the matter should be regarded as sufficiently exceptional to justify the award of such costs as a matter of discretion. In my view, however, this was part of the ordinary cut and thrust of litigation. The matter could only possibly have been so serious as to justify a special award if there had been misconduct on the part of the Claimants, which was not alleged by the Defendants, and which in any case could and should have been raised at the end of the CMC hearing in order to obtain a special costs order under CPR 63.26(2). Such an order would have been outside the scope of the normal cap (see CPR 45.32). In my view, therefore, the totality of the costs incurred by the Defendants in relation to the CMC must be fitted into one item, capped at £2,500. Some of the individual items claimed by the Defendants seem to me to be larger than is to be expected: in particular the expenditure of 5.20 hours on 5 letters to the Claimants' solicitors. On the other hand, given the extra work which the Defendants were put to in relation to the CMC, I do not think it necessary to look in more detail at the figures, which amply justify the maximum permissible of £2,500
The Applications of 11 June 2013
- Two applications were before me on 11 June 2013.
- The first and more important one was an application by the Claimants for directions as to what was to be treated for the purposes of the trial as a "genuine and representative sample" of the alleged infringement. This turned out to be a difficult and controversial application for reasons it is unnecessary to explore here. Although the Claimants contended that they won this application, in my view the result was very much a compromise, which would best be met by an order of costs in the cause. Since the Defendants won the cause, they get the costs of this application. A good deal of evidence was required on both sides to dispose of the application. The total expenditure of the Defendants on this application was far more than the applicable cap, and was in fact greater than contended for, in view of two points discussed below. There is accordingly no reason to award the Defendants anything less than the cap of £2,500, which is in no way disproportionate to this particular application.
- The second application was an application by the Claimants to amend their Reply. The Defendants have sought to attribute 50% of their costs of the outing on 11 June 2013 to this application (no doubt with a view to claiming the maximum £2,500). In my view, however, this was a much simpler matter which they were entitled to consider, but should then have consented to. Accordingly a rather smaller fraction of the relevant costs was attributable to it. An appropriate and proportionate figure to allow in relation to this is £500.
Providing or inspecting disclosure or product/process description
- No specific objection was taken to the Defendants' claim under this head, but taking account of the reduced hourly rates referred to above, the total figure amounts to £4052, which is less than the maximum cap permissible, and which appears to me an appropriate and proportionate figure.
Preparing Witness Statements
- The Defendants seek the cost of preparation of three witness statements:
a. The first is that of Mr. Karadbjahne, which was prepared for use in the course of an application shortly before the trial for further directions. In principle, the costs of a witness statement prepared for use in the course of an application form part of the costs of the application, which may sometimes mean that they are caught by the costs cap applicable to that application. The Defendants contended that this witness statement could nevertheless be considered under the heading appropriate to the preparation of witness statements for use at the trial, because it was in fact referred to at the trial. I reject this contention. The fact that a witness statement used in the course of an application comes to be referred to again at the trial does not detract from the fact that it was prepared for the purpose of the summons, particularly where references to it were mainly for the purpose of explaining matters of procedural history,
b. A witness statement of a Mr. Crawford was prepared shortly prior to the trial (and after the hearing of the application referred to above) dealing with the issue of whether the Defendants would have been responsible for applying grease to the allegedly infringing device. This was not used at the trial, and in view of my Order at the end of the hearing of the application that the questions about responsibility for greasing were to be deferred to the enquiry as to damages (if any) I consider that this witness statement was not relevant to the trial. There was no need to prepare it until it became clear that there was to be an enquiry as to damages, which, as it happens, there will not be.
c. A proof was taken from a Mr. Littlejohn to explain the provenance of the other seat I inspected at the trial, taken out of an old Transit van. Although it was not actually necessary to use his evidence at the trial, it could well have been necessary to call Mr. Littlejohn, and I consider it in principle appropriate to allow the costs of taking a proof from him.
- The figure given in the Defendants' costs schedule for preparation of all three witness statements is £6,773.75. The witness statement of Mr. Karadbjahne was by far the longest of these statements. I consider that 2 hours of work by Mr. Curley was appropriate and proportionate for its production, and accordingly the figure I allow under this head is: £818.
Preparing for and attending trial and judgment
- The maximum allowable figure under this head is £15,000, even for a 2-day trial. The trial of this action lasted just over half a day. Of course the fact that the parties more or less kept within that limit is a credit to the preparation they must have put into ensuring that time was not wasted. Nevertheless it seems to me that it would be disproportionate to apply the full cap of £15,000 to such a short trial, and I consider that a cap of £10,000 would be appropriate in the circumstances. The Defendants' actual costs (even allowing for the hourly rate reduction referred to above), were well in excess of this, and accordingly I consider it appropriate and proportionate to award £10,000 under this head.
- The total of the various sums referred to above is £26,495, well under the applicable £50,000 cap.
The CFA
- The Defendants in the present case had entered into a CFA Agreement with their solicitors at an early stage in the proceedings, with an uplift of 100%.
- The Claimant objected to my taking this into account for various reasons:
- First they said that they had not been provided with all the Defendants' solicitors' risk assessments, though this having been remedied in the course of the hearing, I take no further account of it.
- Secondly they contended that at an early stage in the proceedings the Defendants ought to have had a much more optimistic view of their chances than the 50:50 implied by the 100% uplift. At that early stage, the Defendants ought to have thought they were bound to win on the "geometry" point, because (if their story is to be believed) they did not grease their devices, and accordingly their devices did not allow a seat to be raised without interruption. They were at that time unaware of the fact that the Claimants had found a seat which appeared to satisfy that part of the claim (because of the grease on the device). In my view, however, at an early stage in the proceedings it was entirely reasonable for solicitors to advise that the matter was extremely uncertain. The Claimants could hardly have started the action if there was a complete and obvious answer to it: it was reasonable to anticipate (as proved to be the case) that the Claimants had got in their possession a product with the necessary properties.
- Thirdly, the Claimants contended that the risk assessment must have changed later on, once the Defendants had inspected the product in question and discovered (from their perception of things – which differed from the Claimants') that the chair in the Claimants' possession did not lift without interruption after all. As to that, I was assured by the Defendants' solicitors that there was in fact no revision of the chances of success. In any case, there is in my view no justification for saying that the parties to a CFA should be continually adjusting the relevant uplift according to their instantaneous perception of the chances of success. Unless a new CFA is entered into, the relevant date for consideration of the chances of success is the date at which the relevant agreement was entered into.
- In the absence of any other reason not to give full effect to the CFA in this case, it is necessary to double the figures payable by the Claimants to the Defendants, taking into account both the overall cap of £50,000 and the appropriate cap for each individual stage. The table below shows the result of this exercise:
| § above |
Sum without uplift |
Sum with uplift |
Sum with uplift after cap |
| 6 |
£ 6125 |
£ 12500 |
£ 6125 |
| 7 |
£ 2500 |
£ 5000 |
£ 2500 |
| 9 |
£ 2500 |
£ 5000 |
£ 2500 |
| 10 |
£ 500 |
£ 1000 |
£ 1000 |
| 11 |
£ 4052 |
£ 8104 |
£ 5000 |
| 13 |
£ 818 |
£ 1636 |
£ 1636 |
| 14 |
£ 10,000 |
£ 20,000 |
£ 15000 |
- The grand total payable by the Claimants to the Defendants is accordingly £33,761.
