Ignore proportionality at your peril

The case of Savoye & Savoye v Spicers [2015] EWHC 33 (TCC) concerned the enforcement of an adjudicator's decision. However, it was the decision made by Akerman J on costs that will be of more interest to insolvency professionals engaged in litigation, where the Judge was robust in his application of proportionality, especially in terms of the partner's costs incurred in the matter which the Judge reduced from 111 hours to just 20 hours. Further, although none of the parties had any issue with the other using Leading Counsel, the Judge did, as he did not consider that the issues in the case were sufficient to justify their use. The successful party in the case recovered less than half of the costs claimed (£96,465 versus £201,790).

This case provides a salutary warning on costs and, unless you have discussed the issue with your client, a failure to recover over half the fees incurred from the other side could be a very difficult conversation to have with your client. This is especially where your client is an insolvency practitioner and the proportion of costs incurred which are not recoverable from the other party would otherwise fall to be an expense of the insolvent estate to be paid ahead of creditors' claims.

Our Dispute Resolution colleagues have blogged some analysis on this case which can be accessed by clicking here

Relevant Articles
Area of Interest