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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Afrika & Ors v Cape Plc [2001] EWCA Civ 2017 (21 December 2001)
URL: http://www.bailii.org/ew/cases/EWCA/Civ/2001/2017.html
Cite as: [2003] 4 Costs LR 503, [2002] 1 WLR 2274 2, [2002] 1 WLR 2274, [2002] CP Rep 23, [2001] EWCA Civ 2017, [2003] 3 All ER 631, [2002] WLR 2274

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Neutral Citation Number: [2001] EWCA Civ 2017
Case Nos: 2001 0250 A2
2001 0250A A2
2000 3583 A2
2000 3739 A2

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION (Mr Justice Bell)
and Master Ungley

Royal Courts of Justice
Strand,
London, WC2A 2LL
Friday 21st December 2001

B e f o r e :

LORD JUSTICE MUMMERY
LORD JUSTICE BUXTON
and
LORD JUSTICE LONGMORE

____________________

AFRIKA & ors
Appellants
- and -

CAPE Plc
Respondent
X, Y, Z & ors
Appellants
- and -

SCHERING HEALTH CARE Ltd
Respondent
SAYERS & ors
Appellants
- and -

MERCK AND SMITHKLINE BEECHAM Plc

Respondent
MMR/MR VACCINE LITIGATION

____________________

(Transcript of the Handed Down Judgment of
Smith Bernal Reporting Limited, 190 Fleet Street
London EC4A 2AG
Tel No: 020 7421 4040, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)

____________________

LORD BRENNAN QC & R OPPENHEIM Esq
(instructed by Leigh Day & Co for the Applicant Afrika & Co
& instructed by Houghton & Co for the Applicants XYZ & ors
& instructed by Freeth Cartwright for the Applicants Sayers & ors)
C GIBSON Esq QC
(instructed by Davies Arnold Cooper for the Respondent Cape Plc)
M SPENCER Esq QC & J WAITE Esq
(instructed by CMS Cameron McKenna for the Respondents Schering Health Care,
John Wyeth & Bros Ltd and Organon Laboratory Ltd)
G LEGGATT Esq QC
(instructed by CMS Cameron McKenna for the Respondent APMSD)
A PRYNNE Esq QC & P POPAT Esq
(instructed by Davis Arnold Cooper for the Respondent Merck and SmithKline Beecham Plc)
J FENWICK Esq QC & S CARR Esq
(instructed by Reynolds Porter Chamberlain
for the various interested English NHS Trusts and Health Authorities)

____________________

HTML VERSION OF JUDGMENT
____________________

Crown Copyright ©

    Judgment of the Court

    (substantially prepared by Lord Justice Longmore):

  1. Multi-party actions are a comparatively novel feature of English litigation and the courts have attempted over recent years to fashion new types of order to enable viable actions to be brought in situations where a single individual would find it prohibitively expensive to bring proceedings on his or her own. The present appeals arise in three separate multi-party actions; the first is what is known as the MMR/MR litigation in which claims are made for injuries allegedly suffered by children as a result of the administration of vaccine against measles, mumps and rubella (or just measles and rubella); the second action is the oral contraceptive litigation in which claimants seek damages for injuries sustained by the taking of oral contraceptives; the third action is brought by workers in South Africa against the English holding company of the South African subsidiary, which employed them, for injuries suffered as a result of exposure to asbestos. Typically defendants are drug manufacturers, health trusts on whose behalf drugs are prescribed, or other large corporations some of whom (or whose insurers) have deep pockets. Claimants are typically individuals who could not contemplate financing litigation themselves and obtain assistance for that purpose from the Legal Service Commission or, perhaps, under a Conditional Fee Agreement.
  2. These actions are difficult, as well as expensive, to run and impose great burdens on the practitioners who conduct them and judges who try them. They can, however, be a service to many who suffer severe injuries and it is the policy of the courts to facilitate such actions in appropriate cases and adapt traditional procedures accordingly. These appeals arise only in relation to the details of cost-sharing orders made in the actions but it is right that the court should be guided by the considerations set out in the Woolf Report on Access to Justice published in July 1996. In chapter 17, paragraph 2 of his report Lord Woolf said this in relation to multi-party actions:-
  3. "It is now generally recognised, by judges, practitioners and consumer representatives, that there is a need for a new approach both in relation to court procedures and legal aid. The new procedures should achieve the following objectives:
    (a) provide access to justice where large numbers of people have been affected by another's conduct, but individual loss is so small that it makes an individual action economically unviable;
    (b) provide expeditious, effective and proportionate methods of resolving cases, where individual damages are large enough to justify individual action but where the number of claimants and the nature of the issues involved mean that the cases cannot be managed satisfactorily in accordance with normal procedure;
    (c) achieve a balance between the normal rights of claimants and defendants, to pursue and defend cases individually, and the interests of a group of parties to litigate the action as a whole in an effective manner."

    In relation to the costs of multi-party actions Lord Woolf said:-

    "57. If the treatment of costs is not examined from the outset, the result is either subsidiary litigation or protracted problems when the matter comes to taxation. My general proposals for information on costs to be made available at every stage when the managing judge is involved are all the more important in relation to multi-party actions, where many claimants will be legally aided and have no direct control over costs and where costs can escalate dramatically. At every stage in the management of the MPS [multi-party situation] the judge should consider, with the help of the parties, the potential impact on costs of the directions that are contemplated, and whether these are justified in relation to what is at issue. Parties and their legal representatives, as in other cases on the multi-track, should provide information on costs already incurred and be prepared to estimate the cost of proposed further work. It has been suggested that such examination should occur at intervals of three months. That must be for the managing judge to determine in each individual case."
  4. As a result of the Woolf report Part 19 Section III of the Civil Procedure Rules makes provision for Group Litigation pursuant to a Group Litigation Order and Part 48.6A provides for costs where such an order has been made. We were told that each of the group actions (as we shall now call them) with which we are concerned is now being run in accordance with these Rules. Pursuant to the Rules cost-sharing orders have been made; since the same points arise in each appeal it is sufficient to set out the order of Master Ungley as approved by Bell J in the MMR litigation.
  5. The order provided (inter alia):-
  6. "15. Save as otherwise ordered:
    (a) The liability of each party for and each party's entitlement to recover costs shall be several and not joint.
    (b) Individual costs are those costs and disbursements incurred for and/or in respect of any individual Claimant in relation to matters which are personal to each such Claimant, excluding costs and disbursements incurred for and/or in respect of any claims which may hereafter be selected as lead cases.
    (c) Common costs are all costs and disbursements other than individual costs.
    (d) The common costs incurred in any quarter by the Claimants and each of the Defendants are to be divided by the number of Claimants pursuing their claims on the first day of the quarter.
    (e) If in any quarter a Claimant compromises his/her claim with any one or more of the Defendants on terms which provide for such Defendants to pay that Claimant his/her costs then that Claimant shall be entitled to recover his/her individual costs and his/her several share of the common costs incurred by the Claimants up to the last day of that quarter.
    (f) If in any quarter a Claimant discontinues his/her claim against any one or more of the Defendants or it is dismissed by an Order of the Court whereby that Claimant is ordered to pay such Defendants' costs, then he/she will be liable for his/her individual costs together with his/her several share of the common costs incurred by such Defendants up to the last day of that quarter.
    (g) The first quarter under this costs-sharing order shall run from 14 April 1999.
    (h) Each of the Claimants shall for the purposes of this Order be treated as if he/she had been a Claimant in the actions as from 14 April 1999."

    It will be seen that the provision for quarterly costings mirrors the recommendations of paragraph 57 of Lord Woolf's report.

  7. The claimants appeal against this order and ask for a provision in the following form to be inserted (between (c) and (d) in the order above):-
  8. "The order for payment of common costs and disbursements between the parties following any trial of the common issues whether by trial of the lead actions or otherwise shall follow the event and not depend upon the outcome of individual cases or of issues individual to the lead actions unless otherwise ordered."

    and for a provision in the following form to be substituted for (e) and (f):-

    "In the event of any claimant discontinuing his/her action or settling his/her action any liability for common costs and disbursements of or in respect of such a claimant shall be determined at the trial of the common issues in the lead actions with permission to apply if such trial does not take place."

    We shall call them the "Costs by common issues order" and "the discontinuers and settlers order" respectively

  9. While the issues raised in this appeal are comparatively narrow ones, they are of importance to the parties and this is the first time that the detailed provisions of cost-sharing orders, commonly made at first instance, have been considered by this court. We had the advantage of assistance from witness statements of Mr Colin Stutt of the Legal Services Commission and of 3 solicitors, who have conducted group actions, as well as the assistance of submissions from no less than six leading counsel experienced in this type of litigation.
  10. Approach of this court

  11. Costs orders made at the end of a case are very much a matter for the discretion of the judge who has heard that case. It is only recently that such orders could be appealed at all without the permission of the judge himself. Such orders are now appealable provided that permission is obtained from either the judge or the Court of Appeal but this court is still notoriously reluctant to interfere with the judge's discretion, see Johnsey Estates (1990) Ltd v Secretary of State for the Environment [2000] EWCA Civ 6535 per Chadwick LJ, paragraphs 21 and 22.
  12. Despite a submission from the defendants to the contrary we look at the present appeals in a different way. The orders under appeal have been inaccurately called "pre-emptive" orders. They are not pre-emptive since they allow for the judge to make a special order in a particular case or a different more general order, if circumstances change. Nevertheless they are orders that are intended to cater for (at least the generality of) future events. If it can be shown that some different order from that which the judge has made would be more appropriate, it would not be right for this court to attach any particular sanctity to the judge's order. That is all the more the case in a jurisdiction which is still a developing jurisdiction, as group litigation is. It is important that any general order as to cost-sharing should be the best available in the circumstances. That is not, of course, to say that the appellant should not bear the normal burden of persuading this court that the judge's order is wrong or, at least, inappropriate for the future conduct of the cases.
  13. We are, moreover, not persuaded that merely because in traditional litigation a discontinuing claimant will be required to pay a defendant's costs that that is, of itself, sufficient to justify the judge's order in these group actions. An action which has many claimants is inherently somewhat different from an action in which there is only one claimant, since the action will continue in the same form as currently constituted even after a claimant, for whatever reason, decides to settle or discontinue.
  14. Brief history of cost-sharing orders in group litigation

  15. The courts have been developing the concept of cost-sharing orders since Davies v Eli Lilly & Co (The Opren litigation). In that case Hirst J requested the appointment of an amicus to help the court; Mr George Pulman was instructed and he, together with the assistance of counsel for other parties, drafted a form of order which provided for all plaintiffs to bear costs proportionately among themselves. This resolved an important practical difficulty that, if there was to be one or more legal actions, the claimants in those lead actions would otherwise have had to bear all the costs themselves. Even if such claimants won, the burden of irrecoverable costs would be too great for any claimant, who did not have legal aid, to bear them; moreover, even any legally aided claimant would be liable to find his damages wiped out by the Law Society's charge for costs. The Court of Appeal upheld the order made by Hirst J as being within the provisions of the then Rules of Court [1987] 1 WLR 1136. The order was further refined in Ward v Guinness Mahon Plc [1996] 1 WLR 894 where the concept of several liability on the part of the claimants was confirmed and applied to the liability which claimants might have for costs of defendants.
  16. It was May J in Foster v Roussel Laboratories (unreported, 29th October 1997) who developed the concept of the cost-sharing order so as to require quarterly rests for the calculation of costs for the purpose of application to settlers and discontinuers; in that case at the instance of the defendants he made an order in essentially the same form as that made by Master Ungley in the MMR case in relation to settlers and discontinuers. In explaining it, he said this:-
  17. "Cost Sharing
    In principle the plaintiffs, individually and as a group, and the defendants need to know the basis upon which costs liabilities would be spread if an order for costs were made or came into force. The underlying principle should be that costs which it is appropriate to apportion between or for the benefit of plaintiffs should be divided by the total number of relevant plaintiffs. Costs which it is appropriate to apportion could include (a) the defendants' costs, if one or more of the plaintiffs becomes liable to pay them, and (b) plaintiffs' central administration costs and other plaintiffs' costs which are incurred for the benefit of plaintiffs as a whole, rather than for individual plaintiffs. Any plaintiff who joins the group in the future will acquire the benefit of work done in the past and should become potentially liable for apportionable costs liabilities going back to the beginning. Thus the defendant should be potentially liable to each individual plaintiff for that plaintiff's proper individual costs and for a fraction of the plaintiffs' central costs whose denominator is the number of plaintiffs in the group. Each plaintiff should be potentially liable for a fraction of the defendants' costs whose denominator is the number of plaintiffs in the group. If plaintiffs leave the group by settlement or discontinuance before the conclusion of the litigation when a general costs order is made, a calculation should be made to withdraw from the plaintiffs' central costs and from the defendants' costs a fraction of each of the then totals whose denominator is the number of plaintiffs then in the group before the departing plaintiff leaves. If the departing plaintiff is to pay the defendants' costs, the amount will be the amount of the defendants' costs so withdrawn. If the defendant is to pay the departing plaintiff's costs, the amount will be the amount withdrawn from the plaintiffs' central costs plus the departing plaintiff's proper individual costs. All this would be subject to taxation. This means that costs calculations will need to be made on a quarterly basis, and both the plaintiffs centrally and the defendants need to keep records appropriately."
  18. With this brief introduction to the background of cost-sharing orders, we can examine the submissions made by Lord Brennan QC on behalf of all the claimants in these appeals.
  19. "Costs by common issues order"

  20. Lord Brennan submitted that since the Civil Procedure Rules have come into force, the courts were encouraged to make orders for costs in relation to individual issues and commonly did so. He referred us to dicta of Lord Woolf MR in AEI Ltd v Phonographic Reproductions Ltd [1999] 1 WLR 1507 and said that this new approach should now be reflected in costs-sharing orders made in group actions.
  21. Mr Leggatt QC making the relevant submissions on behalf of the defendants on this aspect of the case submitted that the point of the costs-sharing order was not to say what order for costs should be made but to legislate for how costs should be apportioned once a costs order was made. Echoing Lord Brennan's own submissions on the discontinuers and settlers order, he submitted that it would be wrong now to make a presumptive order as to costs at the end of a trial of common issues (even if it was likely that the court would make a issue based order after the trial of such common issues) since the circumstances at the end of a trial will be various and unpredictable.
  22. We agree with the submissions of Mr Leggatt. However likely it may be that, if common issues are directed to be tried, the costs of those issues will be ordered to follow the determination of those issues rather than await the individual fate of each claimant's action, it would, in our judgment, be wrong to say now that that should be the presumptive position. If, after all, the resolution of a common issue were to turn out to be entirely or largely academic the court should be free to make whatever appears to be the appropriate order in the circumstances. We therefore dismiss the claimants' appeal insofar as it seeks a costs order by reference to the determination of common issues.
  23. Discontinuers and settlers order: (1) Settlers

  24. We consider that discontinuers and settlers cannot be considered together. As far as those that settle their cases are concerned, they do not usually need any presumptive order as to the incidence of costs since costs will be part of the discussion leading to settlement in any event. If there is an agreement that any defendant is to pay any claimant's costs, paragraph (e) of Master Ungley's order is entirely appropriate and we see no reason to interfere with that part of the order.
  25. (2) Discontinuers

  26. It is discontinuers that give rise to the more difficult problem and it was about them that most of the argument took place. In relation to them Lord Brennan submitted:-
  27. (1) that group actions were almost inevitably issue-driven in the sense that the court would decide to try in the first instance common issues of fact and/or law as the only practicable way of achieving a fair outcome;
    (2) that orders for costs after the trial of common issues would usually (or often) follow the event of such issues;
    (3) that it was more consonant with overall justice that orders for costs in relation to common issues should await the determination of such issues rather than being prescribed in advance in the case of discontinuing claimants who might have any number of reasons for discontinuing;
    (4) that if the traditional form of order in relation to discontinuing claimants were to be the usual order, even though it was capable of being varied to meet a particular objection, it was an unfair advantage to defendants, who might lose on such common issues, that they should collect orders exempting them from paying costs of those who had discontinued (and indeed orders entitling them to costs in their favour) on the way to that defeat;
    (5) that the traditional order was also unfair to claimants, if the class of claimants was enlarged by late joiners, since the discontinuer would be paying a larger proportion of costs as calculated at the end of the relevant quarter than he would if the calculation was made when the trial was completed or the case were settled.
  28. The defendants submitted:-
  29. (1) that the provisions for discontinuing claimants made in Master Ungley's order was in a standard form and had been approved by judges experienced in the field of personal injuries for many years;
    (2) that costs orders were always a matter for the judge's discretion and should not be reversed unless the judge had misdirected himself in law or was clearly wrong;
    (3) the fact that these actions were group actions was no reason for departing from the normal rule that a discontinuer should pay the appropriate costs of the action to date;
    (4) that claimants would, in any event, want to know the extent of their liability if they proposed to discontinue and should be able to leave the action, pay the costs incurred and forget about it;
    (5) that, if no decision as to the discontinuers' liability for common costs was made until common issues had been determined, there was no incentive on the claimants or their funders to weed out weak cases for early disposal;
    (6) that there would be a considerable risk of satellite litigation at the time when costs of common issues came to be determined; if for example it was negligent to market or prescribe a drug or to expose workers to asbestos products only after a certain date, it might be necessary for further issues (eg the degree to which the drug was taken or the workers were exposed before and after the date) to be resolved only for the purpose of determining the incidence of costs

    Conclusion on Discontinuers

  30. We have already stated our negative reaction to the defendants first 3 arguments. We have, further, concluded in the light of the parties' submissions that an inherent injustice to claimants and an inappropriate advantage to defendants is indeed liable to occur if the current form of order in relation to discontinuing claimants remains the norm. This is because a group action of the kind with which we are concerned in the present case is essentially different from the typical action where a single claimant (or a limited number of claimants) brings an action. Usually in such typical actions all issues of liability will be tried together whereas it is likely that in group actions certain common or generic issues will be tried on their own, before it is possible or sensible to apply the results to individual claimants. Meanwhile there may be many different reasons why claimants may decide to leave the group once the action has started. Of course, one reason may be that an individual claimant realises that his case is hopeless. But to have a prima facie rule that any discontinuing claimant should have a crystallised inability to recover common costs and a potential liability for the common costs of defendants at the end of the quarter in which he discontinues is too blunt an instrument and is unnecessarily favourable to defendants, when it is as yet unknown whether the claimants as a whole are to be successful in the common issues which are to be tried.
  31. A prima facie rule tends to become the accepted rule, especially if it is necessary to incur the expense of going to the judge and asking, against opposition, for a different order. It is therefore not merely more sensible but also more consonant with justice that both the recoverability of common costs and the liability (if any) of discontinuing claimants for costs of common issues should be determined at the same time as orders for common costs are made in respect of those common issues. The court then has a full picture and can make whatever order is just in all the circumstances. We were given a number of worked examples which we need not set out, but the striking feature of the order in its current form is that defendants who lose on general issues will never pay that proportion of common costs attributable to discontinuing claimants. Whereas that may, in the event, be a correct order, it is not right now to decide that it is, or even to say that it will be the right order unless the judge decides otherwise.
  32. It is also noteworthy that, in one of the few examples of group litigation which progressed to a final decision (the British Coal Chronic Obstructive Pulmonary Disease Litigation), Turner J ordered the defendants to pay the costs of claimants, who had not discontinued and persevered to the end of litigation, but lost their cases on their own individual facts. No doubt any such order as that would be highly exceptional but it shows the wisdom of not having any a priori rule for discontinuing claimants in group actions which takes effect before the outcome of common issues is known.
  33. Bell J recorded that, as at the date of his judgment (3rd November 2000), there were only 16 discontinuers out of a total of 269 claimants who had sued the first defendants. The number in relation to the other defendants is much the same. It looks therefore that, at any rate in the MMR litigation, the problem of discontinuers is not an enormous one. But we bear in mind paragraphs 27 and 28 of Mr Stutt's written statement in which he says that it may be difficult for the Legal Services Commission to fulfil its statutory duty to obtain the best value for money if a significant proportion of costs expended will be irrecoverable regardless of success on common issues. We think Bell J (whose judgment was followed in the judgments in the other cases under appeal) was right to regard the problem as a matter of principle. He summed up his views in paragraph 41 of his judgment, dealing with both discontinuers and settlers:-
  34. "In my view, with all these factors in mind, effective case management requires that the parties have, at this early stage, a clear idea of the costs that they will be liable for, subject to any later order, and that provision is made for those persons likely to discontinue or settle early. Master Ungley's costs order achieves this. Moreover it promotes discipline in the scrutiny and early abandonment of any weak claims. The order proposed on behalf of the Claimants, on the other hand, would leave the liability of any Claimant who discontinued or settled his action at large in respect of his liability (if any) for common costs and disbursements in respect of his claim. It would remain at large until trial of common issues, with liberty to apply if such a trial did not take place. In the circumstances of this case it might remain at large for a considerable period. Like Master Ungley, I regard that as highly undesirable."
  35. The views of Bell J are entitled to great respect and, if we thought that the problems raised by discontinuers were just a matter of case management, we would not interfere. As it seems to us, however, the possible injustice to discontinuers and correspondingly premature advantage to defendants of the relevant paragraphs of Master Ungley's order go beyond mere case management considerations and should be addressed as a matter of principle. The judge says that it is important that the parties have "a clear idea of the costs that they will be liable for". In the context of discontinuers, he is referring here to claimants who discontinue, but his concern is somewhat difficult to follow in the case of a legally aided claimant who is not himself going to be responsible for the defendants' costs at all. The judge's concern is more apt for a non legally aided claimant (none of whom apparently exist in the MMR litigation), but such a claimant can always, if he wishes, offer to pay his appropriate proportion of common costs if he wants to leave the litigation and pay costs at once. The judge also says that it is highly undesirable that a claimant's potential liability for common costs should remain at large for a considerable period but this is just a more emphatic way of making the same point.
  36. More generally, the respondents argued that it was detrimental to the discontinuing claimants themselves to have their potential liability left unresolved and in doubt until the end of the trial, perhaps some years distant. To that, Lord Brennan reasonably replied that it was for claimants and their advisers to decide what was best for them. Whilst the court should of course withhold a solution sought by the claimants if it would be unfair to the defendants or contrary to the requirements of public policy, it could hardy do so simply because it thought that the claimants were not acting in their own best interests. And so far as defendants are concerned, in practical terms an order for immediate payment obtained against legally aided claimants, who form the vast majority of those with whom we are concerned, will not in fact be immediately enforced.
  37. The judge also refers to a matter much emphasised by Mr Prynne QC and Mr Fenwick QC for the defendants that an immediate order for costs in respect of discontinuing claimants will promote "discipline in the scrutiny and early abandonment of any weak claims". We are not persuaded by this argument, attractive as counsel made it sound. To begin with, counsel and solicitors have no business advising that claimants with weak cases should join the register of the relevant group in the first place. And as Lord Brennan reminded us, serious professional obligations rest on both solicitors and counsel who act in legally-aided cases to ensure that the Legal Services Commission is kept informed of the state of the case, and that unmeritorious cases do not continue to receive support. But secondly no one suggests that a notice of discontinuance will have no attraction for a claimant with a weak case. The proposed alteration to Master Ungley's order relates only to common costs. Claimants will still wish to discontinue in order to cease incurring individual costs which will not be recoverable from defendants and indeed to stop defendants continuing to incur costs in relation to individual issues, for which the claimant will or may be liable at the end of the day. Moreover, service of notice of discontinuance will operate to draw a line at the end of the quarter in relation to common costs even if no decision is then made as to the liability for such costs. There will thus still be an incentive for claimants to discontinue weak cases in any event.
  38. The "discipline" argument is, therefore, not persuasive as a matter of fact. We should, however, also add that, even if the argument were more convincing in itself, we would have needed also to be convinced of its real necessity before acting on it. When an order is unfair to claimants, as we believe the order of Bell J to be, strong reasons of policy or case management would be required before that order is nonetheless maintained.
  39. Lastly, we consider Mr Prynne's concern about satellite litigation arising on questions of costs to be exaggerated. If costs cannot be determined after trial of common issues, that will usually be because the issues themselves need refining and not because costs need to be resolved.
  40. For these reasons we consider that paragraph (15)(f) of Master Ungley's order, insofar as it relates to discontinuers, needs amending by the deletion of the words "together with his/her several share of the common costs" and the addition at the end of the paragraph of the words after a semi-colon:-
  41. "liability for common costs and disbursements to be determined following the trial of common issues, with permission to apply if such trial does not take place."

    To this extent the claimants' appeal will be allowed. The orders similar to Master Ungley's that were appealed in the Afrika and OCP claims need amending in like form. We make no decision about claims which are dismissed by order of the court and there is no reason why Master Ungley's order should not remain as it is in order to deal with such cases.

    Claimants' Alternative Proposal

  42. At a very late date Lord Brennan put forward a suggestion (as Appendix 3 to his reply skeleton) to the effect that there should be an order that the claimants' solicitors in the lead actions (rather than all the claimants severally) should be entitled to recover the common costs of common issues incurred when such costs were ordered to be paid by the defendants. Whatever merits any such order might have, it seems to us that it offends against the indemnity principle whereby a party awarded costs of litigation cannot recover more than he is himself obliged to pay in respect of the costs of the litigation. This principle has been subject to criticism; indeed we understand that at the Costs Conference which took place on 30th November/1st December 2001 organised by the Civil Justice Council it was the almost unanimous view of those taking part (who included Lord Phillips MR and May LJ) that the indemnity principle should be abolished, provided that at the same time positive statutory provisions can be enacted identifying the basis upon which an award of costs can be made. It was also their view, with which we respectfully agree, that this can only be done by primary legislation. In these circumstances we do not think it right to give Lord Brennan's alternative proposal any further consideration.
  43. Order: Appeal allowed to the extent indicated in paragraph 28 of the judgment of the court; the respondents to pay 75 per cent of the costs of the appeal; no order for costs in respect of Mr Fenwick's clients; permission to appeal to the House of Lords refused.
    (Order not part of approved judgment)


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