COSTS—ORDER FOR COSTS— ADMIRALTY COURT
COSTS—ORDER FOR COSTS— ADMIRALTY COURT
Krysia Maritime Inc v Intership Ltd [2008] EWHC 1880 (Admlty), [2008] All ER (D) 12 (Aug)
Queen’s Bench Division, Admiralty
Court
Aikens J
1 August 2008
There is no rule or principle, applicable to collision cases or analogous types of case in the Admiralty Court, where there is no counterclaim, that a claimant who was at fault under ss 187(1) and (2) of the Merchant Shipping Act 1995 (MSA 1995) should recover its costs in proportion to its liability to the defendant.
Chirag Karia (instructed by Davies Johnson & Co, Plymouth) for the claimant. Stewart Buckingham (instructed by Holman Fenwick Willan) for the defendant.
The claimant was the owner of “Krysia”, a fast support and intervention vessel. The defendant was the owner of a dumb barge. During operations off the Nigerian coast, one of Krysia’s propellers was fouled by a pick up rope and securing wire attached to the barge. The claimant issued proceedings, contending that the damage had been caused by the defendant’s negligence.
The judge apportioned blame 70%–30% as between defendant and claimant. The instant hearing concerned costs. Both parties agreed that the starting point was CPR 44.3. They accepted that the first question was which party, had been “the successful party” within CPR 44.3(2). Thereafter the court would consider whether or not the general rule in CPR 44.3(2)(a) should apply, so that the successful party should recover its costs, or whether or not it should make a different order under CPR 44.3(2)(b).
The defendant accepted that the claimant constituted the party which had “really won at trial” on the issue of liability. It argued, however, that the court should make a different order for two reasons: (i) because the claimants had been found 30% to blame for the damage; and (ii) becuase of the longstanding practice in the Admiralty Court, which should be continued under the CPR, that costs should reflect the court’s decision on the degree of blame which attached to each party, applying the provisions of ss 187(1) and (2) of MSA 1995.
MR JUSTICE AIKENS:
As a matter of construction of CPR Pt 44.3, it was clear that the judge had a general discretion on how to deal with costs if he decided that, on the facts of the case, it would not be appropriate to follow the “general rule” under Pt 44.3 (2)(a). If the general rule was not followed, a judge might often follow an “issue based” approach to costs and, if that was done, then it had to be justified. In that case the judge had to show that he had taken into account the factors indicated in Pts 44.3(4) and (5), to the extent relevant to the case in hand.
However, as his lordship understood the wording of Pt 44.3, a judge’s discretion was not to be confined to a choice between making either an order that the unsuccessful party had to pay the successful party’s costs, or making an “issues based” order for costs. Such a confinement would be contrary to the plain wording of both Pt 44.3(2)(b) and Pt 44.3(6). But, if a judge did not make an order under the general rule in Pt 44.3(2)(a), and did not make an “issue based” costs order, then the basis of any other approach also had to be justified. Moreover, it had to take into account only those matters referred to in Pt 44.3 and could not take into account irrelevant matters.
Admirality
His lordship turned to the Admiralty context and considered The Rockabill [1937] P 93, [1937], 1 All ER 191; The Trivia [1952] 1 Lloyd’s Rep 548; The EK [1966] 1 Lloyd’s Rep 440; and The Antares II and The Victory [1996] 2 Lloyd’s Rep 482.
The claimant submitted that issues of costs in Admiralty cases should not be dealt with any differently from other types of case covered by CPR Pt 44.3. It submitted that the cases on which the defendant relied did not establish the rule for which it contended. It also contended that there was no principle that a claimant should only get a proportion of its costs where it had only recovered a proportion of its claim because the court had found that it was guilty of fault or contributory negligence. On the contrary, it contended that a claimant in such a position was the party that had won at the trial and the general rule should be applied in the absence of any other factors.
His lordship concluded that the claimant was correct. First, the claimant was the party which really won at the trial. Therefore, the general rule had to apply unless there was a good reason otherwise.
Second, the cases did not establish any rule or principle, applicable to collision cases or analogous types of case in the Admiralty Court, where there was no counterclaim, that a claimant who was found at fault under MSA 1995, ss 187(1) and (2) should recover its costs in proportion to the percentage of liability of the defendant.
Third, the fact that the claimant in the instant case had recovered only 70% of its claim, because it had been found 30% to blame for the fouling, was not sufficient reason (within Pt 44.3(4)(b) or otherwise) to reduce the costs awarded to the claimant. Fourth, on the facts, there was no other basis on which the court could legitimately make an issues based costs order.
Fifth, there were aspects of the defendants’ conduct which reinforced the award of a costs order in favour of the laimants.
The claimant would be entitled to its costs.
