Professor Dominic Regan: Case Law Round Up
There has been a flurry of recent decisions in which indemnity costs have been awarded. BARONESS LAWRENCE V ASSOCIATED NEWSPAPER S LIMITED (2026) EWHC 2207 (KB) represents the high point of the year in this context. The group of Claimants with Baroness Lawrence as lead failed on every single allegation as explained in the liability judgment of Nicklin J found at (2026) EWHC 1637 (KB). They were liable to pay costs, but the battle was fought as to the correct basis upon which they should be assessed. The gulf between standard and indemnity costs here will be measured in millions.
The Defendant wanted indemnity costs for the entirety of the case. Five days before the costs hearing, the Defendant had revealed that it was seeking some £38m, a figure £3m more than the combined approved budgets of both sides for the entirety of the action. Professor Dominic Regan attended court on both days of the second hearing during which the Judge referred to “unprecedented costs” of a kind he had never seen anything like before.
It is inordinately simple to articulate the 5-word test for indemnity costs; they are justified by “conduct out of the norm” but that determination requires multiple factors to be considered.
In THE NEW LOTTERY COMPANY LIMITED V THE GAMBLING COMMISSION (2026) EWHC 1311 (TCC) Joanna Smith J ordered such costs for the entirety of the action saying
“Notwithstanding the size of the claim and the legal resources available, I observe at the outset that the Process Claim has been advanced by the Claimants in an apparently unfocused manner, leading to various of the (numerous) original issues being dropped at the outset of trial, at the outset of closing submissions and even during closing submissions by the Claimants. In many cases, the issues were not dropped until it was specifically drawn to the Claimants’ attention by the court or by the other parties that they had not been addressed in the Claimants’ written closing submissions or that there no longer seemed to be any viable basis on which they could be maintained. The extent of this moveable feast was regrettable and (given the legal resources available to the Claimants) inexcusable. It led to significant time being wasted by the other parties in dealing with issues which were subsequently abandoned. It also risked leaving the court with an imperfect understanding of how the case was being advanced. To describe this as surprising, given the nature and alleged value of this claim, would be an understatement.”
She declined the valiant suggestion of Leading Counsel to salami slice costs by reference to issues or periods of time. Damages in excess of £1 billion had been claimed. The salami reference was cited by Nicklin J and I think we have a new term added to the lexicon of costs law.
In WINEHOUSE V PARRY (2026) EWHC 1970 (KB) Sarah Clarke KC sitting as a Deputy High Court Judge dismissed the claim in a sublime judgment. She then awarded the two Defendants indemnity costs saying “The Claimant chose to bring an inherently weak claim, pursue it aggressively and relentlessly to the end, and make serious and unfounded allegations against the Defendants which significantly damaged their reputations, career prospects, financial security and health. He did so, despite knowing that he and his witnesses did in fact know all along that the Defendants were in possession of the Disputed Items and intended to sell these in the 2021 auction and that significant contemporaneous emails and documents proved this beyond doubt. The Claimant lost on every material point of fact and law. His defeat was total and comprehensive. He and his witnesses were found to be unreliable and were disbelieved on oath. The Defendants and their witnesses by contrast, were found to be reliable and truthful.”