St Albans Girls' School & Anor v Neary

Lady Justice Smith: This is the judgment of the Court on the issue of costs:

1. Following our judgment in which we allowed the appeal of St Albans, there was an application for costs to follow the event. Mr Neary opposed that application, arguing that, in the particular circumstances of the case, there should be no order as to costs. We considered written submissions from both parties. We recognised that, in the Court of Appeal, it is usual for costs to follow the event. Nonetheless, we have decided to make no order for costs in this case for the following reasons.

2. Mr Neary began proceedings in a cost-free jurisdiction. He lost. On the state of authority in the EAT, he was justified in bringing an appeal. Again, he was in a cost-free jurisdiction. He won. Because St Albans (reasonably) wished to overturn that line of authority, the case came to the Court of Appeal. There Mr Neary was pitched against his will into a cost-bearing jurisdiction. It would have been very hard on him if he had had to cave in so as to avoid the risk of costs. In the event he lost but only because St Albans was able to persuade us that the line of EAT authority had developed wrongly.

3. We accept that conduct can be relevant to an order for costs but we consider that it is only conduct which affects costs which should be taken into account. Mr Neary's bad conduct has had no effect on costs.

4. We accept that Mr Neary is impecunious. It would be unrealistic to make a substantial order against him in that we foresee that a disproportionate amount of time and money would have to be expended in order to enforce it. Had we been minded to make an order for costs against Mr Neary, we would not have ordered payment of the whole amount claimed by St Albans in its schedule. We can see no justification for instructing two counsel on this appeal. Also, we consider that the fees charged by Mr Green are more than an opponent should be expected to pay. That is not to criticise the fees charged as excessive. It is entirely open to St Albans to agree such fees as they think appropriate in order to secure the services of counsel of their choice. However, it does not follow that such fees should be recoverable from the losing party. Had we made an order for costs, it would have been in the sum of £5,000 inclusive of VAT."