Readers may recall the detailed decision of Costs Judge Jennifer James in the above matter summarised in the December issue of our Costs Brief.
In summary this was a group action resulting from illness (of varying severity) on holiday.
Base costs were just under £2 million whilst the addition of additional liabilities increased the Defendants’ liability to a shade under £4.5 million – £3,000.00 base costs per claim.
The total damages awarded were £1.7 million divided between the Claimants depending on severity of symptoms.
The Defendants had considered that the Claimants had acted unreasonably in not pursuing the claims of 152 Claimants who had not been taken ill (but had had their holidays ruined) via mediation run by ABTA – the Costs Judge agreed; the scheme covered non-personal injury claims of up to £25,000.00 per booking and would have adequately covered the 152 Claimants’ complaints at a cost of £40,000.00 rather than the £456,000.00 base costs claimed. The Costs Judge considered it was neither “reasonable nor proportionate” to incur such costs by pursuing those matters in the group litigation. The Costs Judge held that the maximum the Defendants should pay in respect of each claim was the maximum ABT “A” fee; considering the finding did not “infringe the sanctity of the agreed costs order”.
The matter was the recent subject of an appeal to the High Court and heard by Mr Justice Singh, sitting with the Senior Costs Judge Master Gordon-Saker.
The decision of Costs Judge James was overturned with the Court ruling upon two important points of principle with respect to ADR.
Firstly the Court held that the Costs Judge was not entitled to go behind the costs order that had been made* and whilst the consideration of ADR was certainly a factor to be considered Mr Justice Singh held, “I do not consider the position has yet been reached that the mere availability of ABTA is enough to deny a successful party costs where they have a costs order”.
Secondly the defendant’s submission that to enter a CFA prior to choosing a voluntary arbitration was inherently unreasonable was rejected by the judge as being, “a point of principle that went too far.”
*Mr Justice Singh had regard to Lahey v Pirelle  1 WLR 998 and Halsey v Milton Keynes  1 WLR 3002.