LM-2023-000035 - [2025] EWHC 2168 (Comm)

Fecha: 18-Ago-2025

Assessment basis

19.

Next I deal with the basis of assessment of the Claimant’s costs. There is no dispute that the Defendant should pay those costs, the only issue is whether the detailed assessment of those costs should be on the standard basis or on the indemnity basis.

20.

For the reasons I now set out I regard this as a clear case for indemnity costs.

21.

The following points appear from the authorities:

The critical requirement required before the court can make an order for indemnity costs, is the presence of some conduct or some circumstance that takes the case out of the norm (see Excelsior v Salisbury Hammer Aspden & Johnson [2002] EWCA Civ 879 at paragraph 32).

Conduct out of the norm is conduct falling outside the ordinary and reasonable conduct of proceedings (Esure v Quarcoo [2000] EWCA Civ 595 at paragraph 25).

The Conduct must justify an order that costs be assessed on the indemnity basis (Excelsior paragraph 39)

Conduct falling short of deserving moral condemnations may merit indemnity assessment (Excelsior at paragraph 37)

22.

Examples of conduct that might be treated as taking a case out of the “norm” and sufficient to justify an award of indemnity costs are (adapted from Three Rivers District Council v Bank of England [2006] EWHC 816 (Comm) at paragraph 25(8)):

Where the paying party, by its conduct, turns a case into an unprecedented (or perhaps unwarranted) factual enquiry by the pursuit of an unjustified case.

The paying party’s case is thin and, in some respects, far-fetched

or irreconcilable with the contemporaneous documents.

During the course of the trial of the action, the paying party resorts to advancing a constantly changing case in order to justify a defence, only then to suffer a resounding defeat.

23.

Miss Campbell submitted that an indemnity order was appropriate because (viewed overall) the Defendant pursued a dishonest defence which was supported dishonestly. In the alternative she submitted the Defendant’s conduct was plainly out of the norm in any event. She relied in particular on the following matters:

The Defendant’s case was at least thin and far-fetched. I found the Claimant’s case in respect of the identity of the contractual counter party to be overwhelming and the Defendant’s case in that regard ot be fanciful and without any evidential foundation (paragraphs 65 to 67).

I found the Defendant’s evidence in support of its case to have bordered on the outrageous (see paragraphs 147 and 148). In particular Dominik Leszczyński’s evidence that the name change I describe at paragraph 7 of the judgment was unconnected to the claim (see paragraphs 7, 55, 67, 115 of the judgment), that high ranking directors of the Defendant were acting for DLIGDL and not the Defendant at all relevant times (see paragraphs 36 and 66), and that there was a break from the Claimant in March 2022 (see section K of the judgment). I found the Defendant’s evidence on this last point to be “patently false” (see paragraph 123).

The Defendant’s (or more correctly Wirginia Leszczyńska’s) refusal to accept that a meeting took place with Mr Fehmi on 9 August 2021 was striking. The documentary evidence overwhelmingly (indeed exclusively) supported the fact that there was a meeting between them (see paragraphs 87 to 96). Similarly, Wirginia Leszczyńska’s evidence on her involvement with the signing of the Mandate (see paragraphs 50 to 54 and 68 of the judgment) was striking. These are in my view instances of the Defendant advancing a changing, but ultimately doomed, case on the hoof.

24.

Miss Campbell relied on other factors in particular the time-consuming factual enquiries only needed because the Defendant pursued weak arguments (that Dominik Leszczyński lacked ostensible authority or that the Claimant had not done enough to merit payment.

25.

Mr Reay submitted that this was simply hard-fought commercial litigation and (I paraphrase) the worst that could be said about the Defendant was that it had lost. He noted that there were no procedural failings on the Defendant’s part and urged me not to conclude that there was nothing out of the norm in this claim.

26.

I am unable to accept Mr Reay’s submission. I am satisfied that the conduct of the Defendant in this claim was well outside of the ordinary and reasonable conduct of proceedings and so outside the norm. The points I have set out and the points raised by Miss Campbell are in my judgment ample justification for that conclusion.

27.

I am also satisfied that the relevant conduct justifies an order that the Claimant’s costs be assessed on the indemnity basis. I have considered if it would be appropriate to limit such assessment to only parts of the costs. I have come to the view that there is no basis for such an approach. The conduct cuts to the heart of the claim and is widespread. It justifies (and easily so) an order for indemnity costs. Had I found that the only basis for awarding indemnity costs was that time had been wasted by the need to conduct long fact-finding exercises, I might have taken a different view and awarded indemnity costs only in respect of some or all of the trial phase of the litigation. That is however not the case.

28.

In my judgment, ordering indemnity costs, and so depriving the Defendant of the usual right not to pay disproportionate costs, is an entirely proportionate response to the Defendant’s conduct of this litigation.

29.

I would add that I regard the Defendant’s failure to comply with CPR 57A as a serious breach of the rules. I do not afford that breach any particular weight. Unlike the other conduct it is unlikely to be attributable to the Defendant or its witnesses. It is more likely to have been an error on the part of the Defendant’s legal advisers.