Imperial Chemical Industries Ltd v Merit Merrell Technology Ltd (costs)

Citation: [2017] EWHC 2299 (TCC)

This was a decision by Fraser J on an application for indemnity costs by MMT against ICI. He held that in the particular circumstances of the case, an order for indemnity costs was appropriate for a number of reasons. Among the reasons given by the judge was the fact that while ICI’s claim overall was not weak, their claim for repudiation was “exceptionally weak” and was verging on “factually non-existent”.

Fraser J also took into account the wholly unreasonable attitude towards contractual obligations in the case. Included in this unreasonable conduct was the fact that an agreement had been reached with MMT under which MMT would receive a substantial payment. In fact, the steering committee at ICI had removed authority for this payment so it would never be made, but MMT were allowed to proceed under the belief that it would be.

In these circumstances the judge made an order for indemnity costs against ICI with a 5% reduction to take account of the fact that MMT had lost on the over-payment point.

Justin Mort QC acted for the Defendant.

Full Judgment

Counsel

Justin Mort QC

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