Factual and Procedural Background
The Plaintiff brought proceedings against two Defendants concerning claims related to damage to a property known as No. 5 Pembroke Place. The dispute involved issues of liability for damage allegedly caused by construction works on an adjacent property, No. 70 Leeson Close. The Plaintiff sought damages, including special damages and claims for defamation and aggravated damages which were not pursued. The case involved applications for interim and interlocutory injunctions, multiple adjournments of the trial, and complex issues relating to the quantification of the Plaintiff's loss.
On 19th October 2004, the first day of the hearing, the first Defendant’s solicitors served a "Calderbank letter" offering €300,000 in full and final settlement without admission of liability, with a time-limited acceptance window. The letter also addressed the issue of costs, proposing that if the Plaintiff did not obtain an award exceeding this offer, the Defendants would seek a costs order in their favor. The trial had been adjourned on several occasions due to discovery difficulties, scheduling issues, and the Plaintiff’s sale of the property during the proceedings, which affected the basis of the claim.
Legal Issues Presented
- Whether the "Calderbank offer" served on 19th October 2004 should influence the court’s costs order given the Plaintiff’s award was approximately 80% of the offer.
- How to assess costs in light of the Plaintiff’s conduct and claims, including whether unreasonable or manifestly unreasonable decisions by the Plaintiff should affect costs liability.
- Whether the Plaintiff should be entitled to costs for the interim and interlocutory injunction applications and the aborted hearings.
- The application of relevant case law and principles regarding costs awards where claims are partially successful or pursued unreasonably.
Arguments of the Parties
Defendants' Arguments
- The Calderbank offer should influence the costs award, as the Plaintiff’s award was less than the offer, justifying a costs order in favor of the Defendants for part of the hearing.
- The Plaintiff’s claims were unreasonably pursued, including a claim based on demolition and reconstruction which was unsustainable.
- The Plaintiff should not be awarded costs for the interim injunction application, as it was unnecessary and the Plaintiff did not attempt to resolve the matter beforehand.
- The Defendants sought costs for the aborted hearings caused by the Plaintiff’s actions, particularly the sale of the property affecting the claim’s basis.
- Reliance on English case law (Re Elgindata Ltd. (No. 2)) to argue that unreasonable or improper conduct can justify depriving a successful party of costs or ordering them to pay the other side’s costs.
Plaintiff's Arguments
- The Plaintiff did not beat the Calderbank offer but argued that this should not deprive him of all costs, only affect costs for part of the hearing.
- The Plaintiff contended that he was entitled to costs for the interlocutory injunction application because the construction works caused damage.
- The Plaintiff disputed that the interim injunction application costs should be disallowed, arguing that access was refused to his engineer, justifying the application.
Table of Precedents Cited
| Precedent |
Rule or Principle Cited For |
Application by the Court |
| Calderbank v. Calderbank [1976] Fam. Law 93 |
Recognition and use of "Calderbank offers" (without prejudice save as to costs) in settlement negotiations. |
Explained the nature of the offer served and its intended effect on costs, though ultimately found the offer in this case to have no bearing on costs. |
| Roache v. News Group Newspapers Ltd. |
Test for assessing costs in relation to Calderbank offers: who has won as a matter of substance and reality. |
The court found the test inapplicable here due to the uncertain nature of the offer and its timing. |
| O'Neill v. Ryanair (No. 3) [1992] 1 I.R. 166 |
Recognition of Calderbank procedure in Irish jurisdiction. |
The court noted the existence of the procedure but no direct jurisprudence was cited on its assessment here. |
| Re Elgindata Ltd. (No. 2) [1993] 1 All E.R. 232 |
Courts may deprive successful parties of costs or order payment of unsuccessful party’s costs where allegations or issues are raised unreasonably. |
Found not particularly helpful as the English rules then in force expressly provided for this, unlike in Ireland. |
| Shelley-Morris v. Bus Átha Cliath [2003] 1 IR 232 |
Judicial warning against abuse of process and unreasonable claims affecting costs awards. |
The court relied on this judgment to assess the Plaintiff’s conduct and unreasonableness in pursuing certain claims. |
| Molloy v. Shell U.K. Ltd. [2002] P.I.Q.R. 56 |
Costs consequences for claims found to be grossly exaggerated or dishonest abuse of process. |
Referenced in relation to the severity of consequences for dishonest claimants, though the Plaintiff’s conduct was not found to reach this level. |
Court's Reasoning and Analysis
The court examined the Calderbank offer served on the first day of the hearing and determined it was too late in the proceedings to have any bearing on costs. The offer lacked certainty regarding total costs outcomes, making application of the Roache test impossible. The court emphasized that penalizing a party for non-acceptance requires a clear and certain offer, which was not present here.
The court considered the Plaintiff’s conduct throughout the proceedings, finding certain decisions manifestly unreasonable and claims transparently unreasonable, particularly regarding the purported necessity of demolishing and reconstructing the property. However, the court distinguished these from outright abuse of process or dishonest conduct warranting harsher costs penalties.
Regarding the injunction applications, the court found the Plaintiff was not entitled to costs for the interim injunction application due to failure to attempt resolution beforehand, but was entitled to costs for the interlocutory injunction as the damage claims were substantiated.
The court addressed the costs consequences of aborted hearings caused by the Plaintiff’s actions, including the sale of the property affecting the loss quantification, awarding costs of those days against the Plaintiff. Costs relating to the preparation of a Bill of Quantities were disallowed for the Plaintiff as the document was not admitted in evidence, with Defendants entitled to costs incurred in examining it.
Subject to these exceptions, the Plaintiff was awarded the costs of the proceedings, including all reserved costs. The court acknowledged that the costs awarded might appear disproportionate to the damages awarded but noted that the Rules of Court provide mechanisms, such as lodging money in court, to mitigate such outcomes.
Holding and Implications
The court’s final decision was to AWARD THE PLAINTIFF THE COSTS OF THE PROCEEDINGS, including reserved costs, subject to specific exceptions:
- The Plaintiff is not entitled to costs for the interim injunction application.
- The Defendants are entitled to costs for aborted hearings caused by the Plaintiff.
- The Plaintiff is not entitled to costs related to the preparation of the Bill of Quantities, with Defendants entitled to their examination costs.
The Calderbank offer served late in the proceedings was held to have no effect on costs. The judgment underscores the importance of timing and certainty in such offers for costs consequences. While the Plaintiff’s conduct included unreasonable decisions and claims, it did not amount to abuse of process warranting denial of costs. No new legal precedent was established; rather, the court applied existing principles to the facts of the case.