Marine & Transit - September 2009
“Winner takes it all?” - collision liability and costs
recovery
The Owners and Charterers of the ship “Western Neptune”
v The Owners and Charterers of the ship “Philadelphia Express” -
Admiralty Court (Mr Justice David Steel) - [2009] EWHC 1522
(Admlty)
This recent decision by the Admiralty Judge
gives further clear guidance on the court’s approach to awarding
costs to a successful party in a collision case.
The topic previously arose in The
Krysia [2008] (reported in our November 2008 Marine
newsletter). In that case, the “Europa” was found 70% and the
“Kyrsia” 30% to blame for the collision. The owners of the
“Kyrsia” sought their full costs of the action whereas the owners
of “Europa” argued they should only recover 70% of their costs in
line with the apportionment on liability. However the court
confirmed there was no practice in Admiralty matters that costs
automatically follow the apportionment of liability between the
vessels. Rather the usual rules on costs under CPR 44.3 will
apply.
Under CPR 44.3 the starting point is that the
successful or winning party is entitled to an order for their
costs. Any departure from the starting point must have regard
to all the circumstances of the case, including the conduct of the
parties.
In this more recent case, the Admiralty Judge
emphasised that the court has a flexible function to consider when
justifying departure from the starting point under CPR 44.3.
Liability was found 2/3rds: 1/3rd in favour of “Western Neptune”
against “Philadelphia Express.” The owners of “Western
Neptune” claimed all their costs as the successful party.
However the Judge decided that various factors in the case
justified the owners of “Western Neptune” only recovering 65% of
their costs. The following issues were taken into account:
- The apportionment of liability can be a
relevant factor (although not determinative).
- The nature of any settlement proposals – the
owners of the “Philadelphia Express” had offered to settle
liability at 60/40 at an early stage. However the owners of
“Western Neptune” had only made an offer, described by the Judge as
“way off the mark”, at a late stage in the proceedings.
- In the case a significant feature was also
the fact that the owners of “Western Neptune” had made late
disclosure of important evidence affecting the issue of
liability.
The decision is of importance as it emphasises
that the conduct of the parties during proceedings, particularly in
relation to the making of appropriate settlement offers, can be a
very relevant factor in influencing the costs award made in favour
of the successful party.
Terry
Donaghy, Partner
Weightmans
LLP