Just when you thought conduct was off-limits on assessment …
One of the more interesting CA decisions to emerge in 2007 is Lahey -v- Pirelli Tyres Limited.
Paying parties had been having a rough time trying to raise conduct points on detailed assessment since the CA in Aaron v Shelton reinforced issue estoppel principles and discouraged attempts to obtain a partial costs order via the back door of detailed assessment. The time to raise conduct points against the successful (or partially successful) party was in front of the trial judge, not the costs judge.
Now in Lahey, the lines appear to have softened, at least insofar as deemed costs orders are concerned (acceptances of Part 36 offers, discontinuances etc).
Not only did Dyson LJ allow for the possibility that a costs judge could impose a percentage reduction on conduct grounds (provided he did so as part of the assessment and not in advance of it), he also provided encouragement for paying parties to seek swingeing reductions under CPR 44.4(1) in approriate circumstances.
The example given was an entitlement to disallow all post-issue costs as unreasonably incurred when the costs judge considers that the claimant acted unreasonably in refusing an offer of settlement made pre-issue.
