HT-2022-000255 - [2025] EWHC 2030 (TCC)

ABM accepts that Matière is entitled to the 10% uplift on the value of the claim, in accordance with CPR 36.17(4)(d). ABM also accepts that it is entitled to enhanced interest in accordance with CPR 36.17(4)(a). I agree that both of these consequences flow from the reasoning set out above.

ABM does not accept that enhanced interest should be awarded on costs, pursuant to CPR 36.17(4)(c) for the analogous reasons set out above, whereas Matière contends that it should have enhanced interest on all its costs under that provision.

In my judgment, the appropriate course is to adopt the same distinction as that applied above. Thus, enhanced interest on the costs of dealing with the claim will be allowed from the end of the relevant period whereas no enhanced interest on the costs of dealing with the counterclaim will be allowed.

I now turn to the rate of interest. CPR 36.17(4)(a) and (c) provide that, unless it considers it unjust to do so, the Court must order that the claimant is entitled to interest at a rate not exceeding 10% above base rate on both the amount awarded in respect of its claim and in respect of costs. ABM submits that the fact that a rate not exceeding 10% above base rate is provided for does not mean that the Court ought to impose the full extent of that 10%. It submits that a rate of 4% above base rate should be adopted both as regards the sum awarded on the claim and as regards costs of the claim.

Matière claims interest at the full 10% over base rate on the basis that there is no reason why it should not be at the maximum amount. Matière submits that this case was outside the norm because ABM had retained money from EKJV which should have been paid to Matière under the arrangement they had.

In OMV Petrom SA v Glencore International AG [2017] EWCA Civ 195 the Court of Appeal provided some useful guidance. The specified rate of 10% was not a starting point but was the maximum possible enhancement. The objective of the rule has been, in large measure, to encourage good practice. The court has a discretion to include a non-compensatory element but the rate had to be proportionate to the circumstances of the case. Factors might include the length of time between the deadline for acceptance and judgment; whether the defendant (the offeree) took entirely bad points or whether it had behaved reasonably in continuing the litigation; and what general level of disruption could be seen to have been caused to the claimant as a result of the refusal to accept the offer.

In BXB v Watch Tower and Bible Tract of Pennsylvannia [2020] EWHC 656 (QB), Chamberlain J said that the wording of CPR 36.17(4) (“not exceeding”) makes plain that an enhanced rate of 10% above base rate would not always be appropriate and did not imply that 10% was the default position. The applicable rate was a matter for the Court taking into account all of the circumstances. In that case he allowed a rate of 4% above base where the defendant’s conduct could not be said to have been unreasonable other than in refusing to engage in ADR.

Focussing entirely on the claim, there is force in a number (but not all) of the points made by Matière. It now seems clear that ABM never really had any defence to the claim. It initially admitted liability (subject to set off) in the sum of £157,241, and closer to trial abandoned its defence to all but £35,000 of the sum claimed. At trial, no meaningful effort was made to defend that balance either. The claim could have been conceded a good deal earlier, subject to set off. There was a mediation on both claim and counterclaim which failed. ABM never made an offer to settle the claim.

I doubt that Matière’s case in respect of interest is significantly stronger simply because ABM held onto money from EKJV that should have been passed down. What mattered was that ABM did not pay Matière but retained the money for its own use.

In all the circumstances, I conclude that the appropriate rate to award is 7% above base rate on both the principal sum and in respect of the costs of the claim from the expiry of the relevant date.

As regards interest on the claim in the period prior to the relevant date, Matière claims interest at a rate of 4% over base rate. ABM did not suggest reasons for not applying that rate. I propose to adopt it.

As regards interest on the costs of the counterclaim, which I have said should be paid on a standard basis, Matière claims interest on standard costs at the rate of 2% above base rate. Again, ABM did not suggest reasons for not applying that rate. I agree that is an appropriate rate.