“THAT PROPORTIONALITY JUDGMENT”: 10 KEY POINTS
The post yesterday on the decision of Master Gordon-Saker in BNM -v-MGN Limited  EWHC B13 (Costs) set out the case in some detail. Here are the key points of that decision.
- On an assessment of costs on the standard basis proportionality should prevail over reasonableness.
- The court should first make an assessment of reasonable costs.
- The court should then stand back and consider whether the total figure is proportionate.
- If the total figure is not proportionate the court should make an appropriate reduction.
- The test of proportionality applies to additional liabilities which remain recoverable after 1st April 2013.
- A consequence of the reduction of the base costs to a proportionate figure will be that the success fee, a percentage of the base costs, also reduced.
- When applying the new test of proportionality the court need not consider the amount of any additional liability separately from the base costs.
- It was not intended that the costs should never exceed the sums in issue. The rules do not state that.
- There will be cases in which the costs bear a reasonable relationship to the sums in issue even though they exceed those costs.
- If an insurance premium is reduced on the grounds that it is disproportionate the court should identify the figure allowed.