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In costs proceedings for the Various Claimants v Mirror Group Newspapers in the phone hacking litigation, indemnity costs were awarded against the Defendant’s unreasonable failure to engage in the process of discussing at least the possibility of alternative dispute resolution, and mediation in particular.
Simon Browne QC, instructed by James Heath of Atkins Thomson and Philip Daval-Bowden of Masters Legal Costs Services, appeared before the Senior Costs Judge, Master Gordon-Saker in the First Wave of costs hearings relating to the MGN phone hacking cases.
Liability regarding the substantive phone hacking claims had previously been determined. In response to the Defendant’s suggestion of mediation in December 2015, the Claimants had asked them to pay the costs of process in January 2016. Further correspondence was sent by the Claimants but they received no response regarding ADR despite raising the issue on a number of occasions. The Defendant sought to argue that asking for costs of process to be paid by the Defendant was of itself obstructive.
The Senior Costs Judge disagreed and found that the Defendant had unreasonably failed to engage in ADR. He stated:
“I have no hesitation in concluding that the defendant has behaved unreasonably in failing to engage in the process of discussing at least the possibility of alternative dispute resolution, and mediation in particular, and given that the common costs base costs have been agreed, it seems to me that there was no reason for pessimism as to the outcome of any mediation.
It seems to me, therefore, that the defendant’s conduct is unreasonable to a high degree and is such as to justify an award of costs on the indemnity basis. Accordingly, save insofar as the parties have agreed that the defendant should pay costs on the standard basis, it seems to me that the claimants are entitled to the costs of the assessment of the common costs bill and of the four individual claims on the indemnity basis.”
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