BT: To receive 85% of its costs
The unsuccessful claimant in the first opt-out collective action decided by the Competition Appeal Tribunal (CAT) has been ordered to make an interim costs payment of £14m.
The tribunal also refused Justin Le Patourel – the class representative (CR) for 3.8m customers of communications giant BT – permission to appeal.
Just before Christmas, the CAT decided that BT’s charges for landline customers were excessive but not unfair, saying BT provided “distinctive value” to its customers “such that its price bore a reasonable relation to value”.
Mr Le Patourel brought the action after Ofcom found that BT had been overcharging customers who only bought a landline and not other services in a bundle by up to £84 a year. BT agreed to reduce future bills but did not compensate customers for past overcharging.
Ruling on costs, the CAT – chaired by Mr Justice Waksman – decided that BT should have 85% of its costs, which topped £26m. This reflected that the CR “succeeded on matters which occupied a very significant part of the trial and submissions”.
Mr Le Patourel argued that, for the purposes of deciding on the interim costs payment, BT’s total costs should be taken as no more than £16.5m. This was the amount of after-the-event insurance bought by his funder, Harbour Litigation Funding, and of the express indemnity Harbour had given BT.
Mr Le Patourel submitted that BT was therefore aware he was working on the basis of its costs being no more than that in the first part of 2021 and the company and its solicitors, Simmons & Simmons, never suggested this was inadequate.
Concluding that it would not be unfair for the starting point to be higher, the CAT said there was no evidence that he, his solicitors Mishcon de Reya or Harbour actually relied on this assumption.
Further, in the event BT recovered more than £16.5m at the detailed assessment, Mr Le Patourel could turn to the unlimited indemnity Harbour had given him.
In any case, Harbour “would obviously be a prime candidate for a third-party costs order if it became necessary”.
The CAT went on to trim £3m from BT’s costs that it considered excessive to make £23m the starting point. It stressed that neither this nor its decision on the reliance issue would be binding on the costs judge at detailed assessment.
This then came down to £20m, as 85% of the costs, and the CAT agreed with BT that it should have 70% of this as the interim costs payment. Mr Le Patourel argued for 50% but the CAT noted that he had received 70% for the initial certification decision. It rounded the final figure up to £14m.
Refusing permission to appeal, the CAT said: “Essentially, the grounds of appeal amount to no more than disagreements with the findings made by the (specialist and expert) tribunal on the evidence, in what was a complex and highly fact-sensitive case.”
The CAT also declined Mr Le Patourel’s request that it recommend to the Court of Appeal that, should it grant permission, the case should be expedited. This was for the court to decide, it said.
He has until 6 March to apply directly to the Court of Appeal for permission.
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