In the recent case of Sirketi v Kupeli & Ors [2018] EWCA Civ 1264 the Court of Appeal overturned an order for costs in favour of the Claimants with an order for no costs.
The claims, which were never formally incorporated into a Group Litigation Order but were joined and managed together with one firm of Solicitors representing the Claimants, involved 838 Claimants who brought claims against Atlasjet and Cyprus Turkish airlines following Cyprus Airlines going into liquidation meaning the Claimants had to purchase alternative tickets. Only 49 of the Claimants succeeded at Trial with 789 Claimants having their actions dismissed. The Defendant was ordered to pay 33% of the Claimants’ costs of the trial, and to pay £225,000.00 on account of those costs.
Subsequently the Defendant appealed the order made in respect of costs arguing that the Claimants had not ‘won’ the case and it was the Defendants who were the successful party and so the Claimants’ ought to be ordered to pay the Defendants costs of the trial, subject only to a small discount to reflect the Claimants’ success in the limited number of lead claims.
In hearing the appeal the Court stated that in their view, the trial judge was wrong to equate “who received the cheque” with the successful party for the purposes of CPR rule 44.2(2) in the context of this complex group claim. She was required to consider who was successful, in the context of the group litigation as a whole; and that was not truly reflected by the fact that a limited number of Claimants were successful in and as a result of the trial. Further, it was noted that both party’s had some substantial success, but no party had been wholly successful in the trial. It was therefore essential to do justice between the parties that their respective success was reflected appropriately in the final costs order made.
The Court thereafter considered the litigation as a whole to determine who was the successful party in the trial and took into account the following matters:
- In respect of the preliminary issues, the Defendant was entirely successful.
- In respect of the three categories of claim and the lead claims themselves, there were mixed fortunes. On the other hand, the Claimants were successful on the issue of principle and they were successful in two of the three lead claims. Furthermore, that success led to 32 further claims being left open for consideration on their individual merits.
- Both parties also had success on the witness evidence.
In conclusion, Lord Justice Davis stated that this was a melancholy tale where the main issue in the litigation was for a while in truth been the issue of costs. The Court ultimately concluded that the costs order was wrong and must be set aside. They considered that no order as to costs would both be compliant with the letter and spirit of the CPR and be the just and appropriate order as to costs of the Trial between the parties.