M.N. v S.M.

Factual and Procedural Background

The Plaintiff obtained a jury award of €600,000 in the High Court for sexual assault. The Defendant, contending that the award was excessive, appealed on quantum only. The Supreme Court reduced the damages to €350,000. Following that reduction the Defendant applied for his costs of the appeal. The Plaintiff did not seek his own costs but urged that there be no order for costs. Judge Geoghegan reserved judgment solely on the issue of appellate costs in order to consider whether general guidance could be articulated.

Legal Issues Presented

1. Whether, after a successful appeal resulting in a reduction of damages, the Defendant/Appellant is entitled to recover the costs of the appeal from the Plaintiff/Respondent.
2. Whether the court should formulate guidelines to assist in exercising its discretion on costs in appeals confined to the assessment of damages.

Arguments of the Parties

Defendant/Appellant's Arguments

• He achieved a “substantial reduction” of €250,000 and therefore, under the normal rule that costs follow the event, is entitled to the costs of the appeal.
• Requiring him to bear his own appellate costs would erode the benefit of the reduction he secured.

Plaintiff/Respondent's Arguments

• Although not seeking the Plaintiff’s own costs, counsel submitted that the fairest outcome would be “no order as to costs.”
• The Plaintiff was not at fault for the High Court’s excessive award and should not be further penalised by paying both parties’ appellate costs.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

Judge Geoghegan observed that no single rule can avoid hardship in every damages-only appeal:

• Normal Rule and Hardship: The principle that costs follow the event often operates harshly for plaintiffs whose awards are reduced through no fault of their own, and equally harshly for defendants who must pay costs despite a successful appeal.
• Discretion on Costs: Each appeal must be assessed on its own facts; rigid norms are inappropriate.
• “Without Prejudice Save as to Costs” Offers: The court encouraged both parties to send open letters after trial but before appeal, making realistic settlement offers that could later be shown on a costs application. Such practice, common elsewhere, would mitigate subsequent hardship.
• Lodgments and Open Offers: Defendants can protect themselves through timely lodgments or higher open offers; plaintiffs can likewise propose acceptable reductions. Failure to use these tools may influence future costs decisions.
• Application to the Present Case: The Defendant’s financial position was such that meaningful offers would not have been feasible, yet the Plaintiff would suffer hardship if ordered to pay the Defendant’s costs. Balancing these factors, the solution favoured by the Plaintiff—no order for costs—was deemed “fairest.”
• Circuit Court Appeals Distinguished: The judge noted that full rehearings on circuit appeals involve different considerations; nothing in this judgment should fetter that separate discretion.

Holding and Implications

NO ORDER AS TO COSTS ON THE APPEAL.

Each party will bear its own appellate costs. The decision underscores the Supreme Court’s flexible discretion in costs matters, encourages the wider use of settlement mechanisms (lodgments and “without prejudice save as to costs” letters), and leaves undisturbed the principles applicable to circuit appeals. No new binding precedent was set, but practical guidance was offered for future damages-only appeals.