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31 July 2015

Don’t over budget for the costs of litigation

The Technology and Construction Court recently made a costs management decision that demonstrates the extent to which the courts are now willing to manage the costs of litigation so that they are proportionate.

Macfarlanes acted for the defendant, which successfully challenged the level of the claimant's proposed costs budget.

In GSK Project Management Limited (in liquidation) v QPR Holdings Limited, the court:

  • decided that the claimant's proposed costs budget of £825,000 was grossly disproportionate to the value of the claim, which was only £805,000;
  • examined in detail the incurred costs and proposed future costs for every phase of the litigation in the claimant's costs budget, the levels of which the court criticised in the strongest terms; and
  • proceeded to set budget figures for each phase of the litigation (including those phases already undertaken) that it would be reasonable for the claimant to incur - resulting in a total costs budget of £425,000.
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