Baroness Lawrence of Clarendon OBE & Ors v Associated Newspapers Limited

This judgment addresses two costs related issues canvassed by the parties at the fourth Case Management Conference in this litigation which was heard on 10 and 11 November 2025. I am writing this judgment, however my reasoning and conclusions are supported by the Judge. The first issue relates to the Defendant’s “costs liability” application notice dated 10 September 2025. The second issue relates to the parties’ respective applications to vary their approved budgets; the Claimants’ application dated 10 September 2025; and the Defendant’s application dated 31 October 2025.

The application is supported by the 13th witness statement of Ms Richmond dated 10 September 2025. The Claimants have filed the 7^th witness statement of Mr Thomson dated 22 September in response.

The Defendant seeks an order that:

“In the event that each or any of the Claimants is ordered to pay costs to the Defendant, and unless otherwise ordered by the Court;

a.

The definitions of Individual Costs and Common Costs recorded in the November 2024 CCMC Order shall apply for the purpose of the allocation of the Defendant’s Individual and Common Costs of the claims;

b.

Each Claimant ordered to pay costs shall be severally liable for the Individual Costs of their Claim; and

c.

Each of the Claimants ordered to pay costs shall be jointly and severally liable with each of the other Claimants ordered to pay costs for the Common Costs of the Claims.”

As explained by Ms Richmond in her 13^th witness statement the background to this application arises from the requirement for the Claimants to file budgets separating their individual and common costs which was imposed at the November 2024 CCMC. At paragraphs 11to 14 of my previous judgment [2025] EWHC 106 (KB) I said:

[11] Cost sharing orders are a feature of Group Litigation, see PD 19B paragraph 16.1 and CPR 46.6. These provisions apply only where the Court has made a Group Litigation Order and makes provision for the apportionment of “individual costs” and “Common Costs”. Individual costs are those costs incurred in relation to an individual claim on a group register and common costs are those costs incurred in relation to the GLO issues. The default position is that a group litigant who is a paying party will be liable for the individual costs of the receiving party/parties and an equal proportion, together with all the other group litigants, of the common costs.

[12] There is no group litigation order in this case. The Court’s powers in relation to costs are however very broad. CPR 44.2 makes clear that the Court has a very wide discretion in relation to issues of costs that are in no way circumscribed by the commonly made costs orders set out at CPR 44.2 (6).

[13] As I pointed out in the case of Hammon -v- University College London[2024] EWHC 1744 (KB) [42], the Court’s conventional powers of case management under CPR 3.1 are very wide indeed and include the power to “take any other step or make any other order for the purpose of managing the case and furthering the overriding objective”. In that case I held that the effect of CPR 46.6 could be imported into the case management order to ensure fairness in respect of the parties’ potential liability for costs.

[14] Mr Sherborne was clear that the firms representing the Claimants had reached a clear understanding of what the division between “individual costs” and “common costs” was. Given that clear understanding we invited the parties to draft a suitable costs sharing provision to be incorporated in the case management order. The inclusion of a costs sharing order provides one very tangible benefit, which is that the Court can approve a single budget for the Claimants and a single budget for the Defendant in respect of the remaining steps in this litigation. In our view the inclusion of a costs sharing order provides a far more transparent mechanism for controlling the budgeted costs in circumstances where there is a substantial generic case presented with a large degree of overlap between the individual claims. In the circumstances, we required the parties to revise and discuss their budgets for agreement and further consideration by the Court in the course of the hearing.

Following this hearing the parties agreed the following wording which was incorporated into the November 2024 case management order:

“Common Costs

15.

For the purposes of Costs Management of the Claims (as defined above) and/or for the purpose of the sharing by the Claimants of any liability for the Claimant’s Common Costs, as defined below, the following terms shall have the following meanings in respect of costs after the date of this order:

15.1

“Individual Costs” are those costs which are directly referrable to the Claimants’ cases and are those incurred for and/or in respect of any individual Claimant in relation to matters which are particular and personal to each such Claimant.

15.2

“Common Costs” means all costs incurred by the parties other than Individual Costs and includes, but is not limited to:

15.2.1

any generic or similar fact witness evidence and any generic or similar fact disclosure;

15.2.2

costs incurred in relation to any common issues and/or generic issues and/or similar fact issues (as may be determined by agreement of the parties or the Court), including the trial costs of such issues which are to be determined at trial;

15.2.3

costs incurred in the case management of the Claims including all CMCs, CCMCs and PTRs; and

15.2.4

costs incurred for the purpose of any budgeting of the Common Costs and/or any co-ordinating of the budgeting of Individual Costs.

16.

If there is any dispute as to whether certain costs are Individual Costs or Common Costs, the parties have liberty to apply to the Court to allocate such costs.”

Thus, it can be seen that the order provided for the internal sharing of common costs between the Claimants and does not address the Claimants’ liability for adverse costs in respect of those common costs.

It is right I record that following the CCMC hearing there was some e-mail correspondence between the parties and the court. Following that exchange I clarified that the costs sharing provision in the order only related to cost sharing between the Claimants of the Claimants ‘own’ costs and did not import the terms of CPR 46.6 or do anything to determine any issue of the Claimants’ potential liability for adverse costs. The Defendant made it clear that it fully reserved its position on whether the Claimants should be liable for any adverse Common costs on a joint, as opposed to several, basis.

At paragraph 5.10 of her witness statement, Ms Richmond accepted that the question of liability for adverse costs is an issue that would normally be determined at the end of proceedings, however she pointed to circumstances which made it particularly important for the court to do so now. First, the Claimants’ solicitors had written to the Defendant’s solicitors in March of this year requesting the Defendants agreement to the Claimants incurring several liability for any adverse costs. Second, that the Claimants had inflated the potential adverse costs risk to the Defendant by the acquisition of ATE insurance without seeking the Court’s determination on the issue of several liability.

In his witness statement Mr Thomson explained that the Claimants had reassessed their potential costs liability, following the making of the costs management order, in the region of £14,106,068.25. He stated that that the requirement for ATE insurance had been approached on a several basis and had been carefully considered. He made the point that if a determination is made now that each Claimant should face a potential joint and several liability for the Defendant’s Common Costs (plus their own Individual Costs) then the level of indemnity each would need could be massively increased, to address the risk that they might yet find themselves left solely liable for those costs and raised the spectre of additional ATE insurance being required at even greater cost.

On behalf of the Defendant, Mr Mallalieu KC stressed that it is important to highlight the Claimants’ similar fact and generic cases because they inform the nature of the Common Costs that have been and are being incurred in this case. The Common Costs are not being incurred merely because these cases are being tried and case managed together, nor simply because the parties are largely deploying a single counsel team to deal with the cases, but because the cases themselves rely only in part on specific factual allegations of particular alleged instances of conduct relating to the individual Claimants and in very large part on a set of common allegations spread across the similar fact and generic cases and which are relied on by each Claimant on a common basis as (on their case) the bedrock of each of their claims. To illustrate this point he referred to the fact that each Claimant pleads at paragraph 15 of their Particulars of Claim that they will:

“… rely upon the fact that these Unlawful Acts were habitually and widely carried out or commissioned by Associated and its journalists (as set out in paragraphs 9 to 14 above) in support of his case that the same Unlawful Acts were also carried out or commissioned against him as referred to in paragraphs 20 to 25 below as part of the modus operandi of obtaining, preparing and publishing stories during this period.”

Against this background Mr Mallalieu KC made the following points;

Mr Mallalieu KC drew our attention the following cases; Stumm -v- Dixon (1889) 22 QBD 529, Dufoo -v- Tolaini/Re Quiet Moments Ltd [2014] EWCA Civ 1536, Rowe -v- Ingenious Media Holdings plc [2020] EWHC 235 (Ch) and Ontulmus -v- Collett [2014] EWHC 4117 (QB), which he submitted should guide our approach.

Mr Mallalieu KC stressed that that the approach proposed by the Defendant would not fetter the Court’s decision in due course to decide what are – and what are not – Common Costs and that the Defendant was not seeking to contend that the Claimants should each be liable in principle for all of the adverse costs of the claim assuming costs are awarded. To the extent that there are Individual Costs, directly referrable to and incurred only in respect of matters particular and personal to a Claimant’s individual claim, those would fall at the feet of that Claimant only. He maintained that the Defendant’s application concerns only the Common Costs that the Claimants are causing the Defendant to incur in defence of the claim jointly and collectively being pursued by the Claimants against it. In the event that there is any dispute at any stage as to which costs fall in which category, that can be resolved by a Costs Judge on any detailed assessment.

Lastly, Mr Mallalieu KC pointed out that nothing in the order he sought will expose the Claimants, collectively, or an insurer to a greater liability for adverse costs than a several liability order would. The costs do not change. Each Claimant’s approach to obtaining ATE must be reasonable by reference to liabilities it faces.

On behalf of the Claimants, Mr Hogan resisted the application on four main grounds.

First, Mr Hogan submitted that costs should ordinarily be determined at the end of the trial, and the Defendant has failed to demonstrate any good reason why any Order needs to be made at this time. Indeed, its own evidence indicates the unusual nature of the order sought.

Second, Mr Hogan submitted there are several good reasons why a pre-emptive Order should not be made. He took issue with the four principal reasons put forward by the Defendant for making the order; the fact the Claimants had raised the issue of several liability, the nature of the Claimants’ insurance arrangements, the Claimants’ ability to meet an Order for common costs and the burden on the Defendant of recovering common costs if several liability is imposed.

Mr Hogan accepted that the Claimants had raised in correspondence the issue of several liability but stressed that they only did so by way of correspondence several months ago. That was part of the discussion of issues in the case, and the Claimants have not made their own application. This reason had no bearing on the Defendant’s current application for a different order.

Mr Hogan accepted that Claimants, as set out in the Seventh Witness Statement of Mark Thomson, have obtained individual ATE insurance policies of £2.35 million, collectively £14.1 million, which were calculated in accordance with the figures in Exhibit MT7, to meet the totality of the Defendant’s costs. He submitted that the Claimants cannot be sensibly criticised for the total indemnity spend. He disavowed the suggestion that this was in some way the wrong course and pointed out that Defendant’s proposed Order will throw onto each of the Claimants a huge joint and several liability, and require them as private individuals to take on any solvency or other risk of non-payment by their co-Claimants. He raised the possibility that each Claimant might need to increase their ATE cover to guard against this risk.

Mr Hogan pointed to the total indemnity coverage of £14.1 million which meant that the Defendant should have adequate provision for its costs should it win the case and mitigated the risk of non-payment.

Third, Mr Hogan submitted the Order sought in its own terms is provisional in any event, and accordingly pointless.

Fourth, Mr Hogan submitted in the alternative that, if the Court was minded to make any element of a costs Order at this stage, that it should be for several liability for the following reasons;

At the conclusion of the hearing, we announced that we would make the order sought by the Defendant. These are our reasons for that decision.

We accept that we have the jurisdiction to make the order sought, indeed it was not seriously suggested by Mr Hogan that we didn’t. Costs sharing orders have now become commonplace in multi-party actions where parties combine to litigate common issues and as I have previously indicated the Court’s case management powers under CPR 3.1 are very wide, see para 13 of the costs management judgment [2025] EWHC 106 (KB).

The general position in relation to how Common Costs should be shared in circumstances where parties have their own individual case, but combine to present a collective claim or defence is long established, see Stumm -v- Dixon per Lord Esher MR at 533

“In my opinion the true rule is this: When an action is tried against two or more defendants, and any defendant separates in his defence, and the judgment is against all, the law is that each of them is liable for the damages awarded by the judgment, and each of them is liable to the plaintiff for all costs taxed on his behalf as properly incurred by him in the maintenance of his action, except as to costs caused to him by so much of the separate defence of any defendant as is, and can only be, a defence for that defendant as distinguished from other defendants.”

This case establishes the principle that each party is liable jointly with each other for the whole of the reasonable costs of their common claim or defence, but only severally for the individual costs of their claim. This principle applies equally to claimants and defendants, see, Dufoo -v- Tolaini / Re Quiet Moments Ltd.

The Court should pay particular attention to the nature of the claim when considering whether to order joint or several liability for costs, see, Rowe -v- Ingenious Media Holdings plc. In this case Nugee J said:

“Of course in a simple case where A and B have a true joint claim (for example where they claim as the joint owners of property, or joint parties to a contract), one would expect them to be jointly liable for the defendants’ costs. And I also have no difficulty with the proposition that the same applies as a general rule to many cases where the Cs technically have several claims, but, as very commonly happens – probably in the majority of claims in this Division – a number of Cs join forces to bring what is in effect a single claim, or to be more precise a single group of claims. Very often in such cases the Cs will be connected parties (for example companies in the same group; members of the same family; individuals, their trustees and their corporate vehicles; and the like), and there will in effect be only one case being made, even if, due to the complexity of the facts, technically different Cs have different causes of action and claim different relief.”

Circumstances may range from large scale GLO or quasi GLO claims involving hundreds or thousands of claimants, where each claimant is not connected and has their own individual claim, to cases such as the present where the Claimants have effectively combined together to present claims based upon common allegations against a single Defendant.

These principles do not seem to be in dispute. The real issue was whether we should make such an order at this stage of the litigation.

In our judgment the circumstances of this case do warrant making the order sought in relation to Common Costs at this stage. We accept the points made by Mr Mallalieu KC summarised at paragraph 11 above. As has been repeatedly observed by the Judge and underlined by Mr Mallalieu KC, the Claimants’ cases depend not merely on them bringing the same central case based on the Similar Fact and Generic cases, but also on each individual Claimants’ own specific case being said to cross support each of the other Claimants’ cases and the collective case as a whole. Although there has been some recent pruning of the generic case following the judgment on 10 October 2025 ([2025] EWHC 2573 (KB)) it remains a key feature common to all the Claimants’ claims. In the circumstances, we reject Mr Hogan’s alternative submission that the Common Costs should be ordered on a several basis.

In our judgment it is imperative that the parties and in particular the individual Claimants have the clearest possible understanding as to the consequences of the way in which this litigation is being conducted. If that means the individual Claimants need to reassess their ATE cover that can only be in their own best interests. It is particularly important that this issue is addressed at this point as substantial costs have already been incurred and the parties will soon be incurring more substantial costs in preparation for the trial next year.

The fact that costs should ordinarily be determined at the end of the case is not a good reason for us to decline to take this step now. In this regard it is important to note that the order will not tie the court’s hands if at a later point the circumstances justify such a departure.

The parties each sought variations to 4 phases of their existing budgets as set out below.

CPR 3.15A provides:

(1)

A party (“the revising party”) must revise its budgeted costs upwards or downwards if significant developments in the litigation warrant such revisions.

(2)

Any budgets revised in accordance with paragraph (1) must be submitted promptly by the revising party to the other parties for agreement, and subsequently to the court, in accordance with paragraphs (3) to (5).

(3)

The revising party must—

(a)

serve particulars of the variation proposed on every other party, using the form prescribed by Practice Direction 3D;

(b)

confine the particulars to the additional costs occasioned by the significant development; and

(c)

certify, in the form prescribed by Practice Direction 3D, that the additional costs are not included in any previous budgeted costs or variation.

(4)

The revising party must submit the particulars of variation promptly to the court, together with the last approved or agreed budget, and with an explanation of the points of difference if they have not been agreed.

(5)

The court may approve, vary or disallow the proposed variations, having regard to any significant developments which have occurred since the date when the previous budget was approved or agreed, or may list a further costs management hearing.

(6)

Where the court makes an order for variation, it may vary the budget for costs related to that variation which have been incurred prior to the order for variation but after the costs management order.

The Court must therefore identify a significant development (1) and ensure that the additional costs sought by a party are attributable to that significant development 3 (b). Any such costs identified must have been incurred after the previous costs management order but prior to the variation order 3 (6).

The term significant development is not defined in the CPR, but as the note to the White Book makes clear, it appears to include any event, circumstance or step which is of such a size and nature as to go beyond the events circumstances and steps which were taken into account expressly or impliedly in the previously approved or agreed budget.

One further point which should be properly understood by any party involved in costs management and particularly applications to vary a budget; is that if agreement cannot be reached on a figure for a particular phase of the budget, the Court is not bound by any offer which has been made. The Court retains a complete discretion as to the sum which it approves.

Turning then to the individual phases of the budgets where variations are sought.

The Claimants identified in their Precedent T the costs of preparing Amended Replies to the Amended Defence.

The sum sought was made up of £36,120 time costs and £103,175 disbursements.

We accept that Amended Replies were required. However, given the pleaded issues, Replies were only required to answer the Defendant’s limitation defence. Beyond that, the only legitimate function of a Reply would be to admit matters raised in the Defence.

It is our view that the Claimants have gone beyond these necessary functions of a Reply. Indeed, in respect of the Ward Allegations (see 10 October 2025 judgment [2025] EWHC 2573 (KB)), the Reply impermissibly advanced a factual case that contradicted the case advanced in the Particulars of Claim.

In the circumstances we would reduce the sum claimed significantly and allow a further £20,000 for the phase to reflect the work reasonably and proportionately required.

The Defendant identified in its Precedent T the need to (i) consider and analyse the Re-Amended Particulars of Claim, (ii) prepare a Re-Amended Defence, (iii) consider the Re-Amended Replies and prepare an Amended Rejoinder, (iv) give supplemental disclosure (if any) and (v) file and serve supplemental witness statements as being significant developments arising from the Claimants’ application to amend considered by the Judge on 10 October 2025.

The sum sought was made up of £620,825 time costs and £337,733.5 disbursements

This request is more legitimate. The Claimants have made significant amendments to their Particulars of Claim. These amendments impose a significant burden to answer and investigate new allegations of UIG (or propensity evidence). The preparation of supplemental witness statements could not fall within this phase.

We would allow a further sum of £95,000 as being reasonable and proportionate to the work required.

The Claimants identified in their Precedent T the requirement for a further CMC above that provided in the previous budget

The sum sought was made up of £200,000 time costs.

Allowed.

The court previously determined that a reasonable and proportionate sum for a CMC was £200,000. The requirement for a third CMC was not previously contemplated and is therefore a significant development.

The Defendant identified in its Precedent T the requirement for a further CMC above that provided in the previous budget

The sum sought was made up of £100,000 time costs and £100,000 disbursements.

Allowed for the same reason.

The Claimants identified in their Precedent T the need to incur additional work as a result of the order dated 11 July 2025 and for reviewing the additional disclosure to be provided as sought in the Claimant’s application dated 10 September 2025 together with substantial supplementary disclosure.

The sum sought was made up of £446,400 time costs and £49,120 disbursements.

It is our view that the Claimants are largely responsible for their own failure to undertake the disclosure exercise properly in the first place. We would disallow the costs that relate to work on their own disclosure. The Claimants have only succeeded in obtaining several discrete but limited orders for disclosure against the Defendant and to this limited extent there has been a development which could just about be termed “significant”.

In the circumstances we would allow a further £80,000 for the work reasonably and proportionately required.

The Defendant identified in its Precedent T (i) the requirement to maintain access to a legacy e-mail archive for a further period of one year and (ii) the requirement to unredact documents pursuant to paragraphs 1 and 2 of the Spring CMC order

The sum sought was made up of £62,382 time costs and £362,056 disbursements.

The actual cost of maintaining the legacy database for a further year is £357,919. Mr Hogan sought to argue that this expenditure could not be classified as legal costs as defined by CPR 44.1 which provides:

“‘costs’ includes fees, charges, disbursements, expenses, remuneration, reimbursement allowed to a litigant in person under rule 46.5 and any fee or reward charged by a lay representative for acting on behalf of a party in proceedings allocated to the small claims track;”

Mr Hogan submitted that there was long established authority that such costs must be legal costs, he drew our attention to London Scottish Benefit Society -v- Chorley and others [1884] 13 QB 872, 876:

“A great principle, which underlies the administration of the English law, is that the courts are open to everyone, and that no complaint can be entertained of trouble and anxiety caused by an action begun maliciously and without reasonable or probable cause; but as a guard and protection against unjust litigation costs are rendered recoverable from an unsuccessful opponent. Costs are the creation of statute. The first enactment is the Statute of Gloucester, 6 Edw. 1, c. 1, which gave the costs of the ‘writ purchased’. There is a passage in Lord Coke's Commentary, 2 Inst. 288, which it is worth while to examine, as it affords a key to the true view of the law of costs. That passage is as follows: ‘Here is express mention made but of the costs of his writ, but it extendeth to all the legal cost of the suit, but not to the costs and expenses of his travel and loss of time, and therefore ‘costages’ cometh of the verb ‘conster’, and that again of the verb ‘constare’, for these ‘costages' must ‘constare’ to the court to be legal costs and expenses. What does Lord Coke mean by these words? His meaning seems to be that only legal costs which the Court can measure are to be allowed, and that such legal costs are to be treated as expenses necessarily arising from the litigation and necessarily caused by the course which it takes. Professional skill and labour are recognised and can be measured by the law; private expenditure of labour and trouble by a layman cannot be measured. It depends on the zeal, the assiduity, or the nervousness of the individual. Professional skill, when it is bestowed, is accordingly allowed for in taxing a bill of costs; and it would be absurd to permit a solicitor to charge for the same work when it is done by another solicitor, and not to permit him to charge for it when it is done by his own clerk. The question before us does not depend on the privileges of a solicitor.”

Mr Hogan submitted that the costs of the server was a business overhead of the Defendant maintaining its internal IT system and could not be classified as legal costs.

Mr Mallalieu KC submitted that this litigation was the only reason these costs were being incurred and were it not for the Claimants’ insistence that the email archive be preserved the documents would have been transferred along with others to replacement servers and that in the circumstances the costs must be treated as expenses necessarily arising from the litigation and necessarily caused by the course which it takes.

We accept that the evidence demonstrates the cost of the server is only being incurred by reason of this litigation. In the circumstances, this cost was not factored into the original budget and accordingly we will allow the further sum of £357,919 for the phase.

The Claimants identified in their Precedent T the need to consider the increased number of witness statements served by the Defendant said to be from 30 to 50 based on an assumption that the Defendant would be serving a further 9 witness statements.

The sum sought was made up of £175,000 time costs.

We accept that the budget was approved on the basis that the Defendant would serve a maximum of 30 witness statements. In the circumstances 11 further witness statements require consideration.

We accept that this development could be described as “significant” however the sum sought is outside what we would regard as reasonable and proportionate for the work involved. We would allow £50,000.

The Defendant identified in its Precedent T the fact that the previous budget assumed the service of between 20 and 30 witness statements by the Defendant whereas in fact 41 witness statements were served.

The sum sought was made up of £188,100 time costs and £62,700 disbursements.

Broadly, we accept the number of witnesses for the Defendant has expanded because the scope of the claim has expanded by amendment, bringing in new allegations. We accept that this amounts to a significant development in the litigation.

We consider the £250,800 sought as being outside the range of reasonable and proportionate costs required for this work. We would allow a further sum of £90,000 as being reasonable and proportionate for this work.

The parties agree that the November 2024 case management order was intended to incorporate a costs management order. In the course of the hearing I noted that a proper costs management order had not in fact been drafted.

CPR 3.15(2) states:

The court may at any time make a ‘costs management order’. Where costs budgets have been filed and exchanged the court will make a costs management order unless it is satisfied that the litigation can be conducted justly and at proportionate cost in accordance with the overriding objective without such an order being made. By a costs management order the court will—

(a)

record the extent to which the budgeted costs are agreed between the parties;

(b)

in respect of the budgeted costs which are not agreed, record the court’s approval after making appropriate revisions;

(c)

record the extent (if any) to which incurred costs are agreed.

It is my experience that parties seldom draft proper or effective costs management orders notwithstanding the guidance contained paragraph 13 of my Guidance Note on Cost Management Hearings in the King’s Bench Division at Annex 8 of the King’s Bench Guide.

We would be grateful if the November case management order could be amended appropriately.