Indemnity Costs Awarded Where Proprietary Estoppel Claim Pursued As "Anvil For Settlement" Against Elderly Mother

By Toby Moreton, Costs Lawyer (regulated by the CLSB) · ·

Master Bowles awarded indemnity costs where litigation was pursued as an “anvil for settlement” through invented assurances contradicted by contemporaneous documents, whilst finding that mediation obstacles created by both parties did not justify costs penalties against successful defendants.

Indemnity costs proprietary estoppel unfounded claim CPR 44.3 Grijns v Grijns

GRIJNS V GRIJNS [2025] EWHC 2853 (Ch)

In Grijns v Grijns [2025] EWHC 2853 (Ch), Master Bowles (sitting in retirement) determined costs following dismissal of the claimant’s proprietary estoppel claim concerning a £3.85 million Chelsea property. The defendants sought indemnity costs; the claimant argued for no order citing the defendants’ pre-litigation conduct and alleged failure to mediate. The court held that costs follow the event, with no reduction for the claimant’s minor success on an accounting issue, which was peripheral. The defendants’ 10 June 2023 entry to the property was lawful and not causative of settlement failure. Applying PGF II SA v OMFS Co Ltd [2014] 1 WLR 1386, the court found no unreasonable refusal to mediate where the claimant imposed unreasonable participation conditions. The court awarded indemnity costs under Three Rivers District Council v Bank of England [2006] 5 Costs LR 714, finding the claim weak and based on invented assurances, with litigation pursued as an “anvil for settlement” through tactical capacity allegations and a late committal application. Post-judgment costs were awarded on the standard basis.
Link to full judgment

Putting aside the question as to whether it was appropriate to institute contempt proceedings while, at the same time, questioning the capacity of the alleged contemnor, it is clear to me that Andrew’s motives in respect of the application were not founded in a genuine belief that he had been damaged by his mother’s conduct, in a way that required the exercise of the court’s contempt jurisdiction, but were concerned, rather, with the tactical imposition of pressure upon his mother, in the hope of facilitating a settlement, in his favour, of what I reiterate to have been wholly unfounded litigation. 65. In the result, I am entirely satisfied that, standing in isolation, Andrew’s conduct of this litigation clearly warrants an order for indemnity costs and that there is no discretionary reason not to make such an award

Citations

Halsey v Milton Keynes General NHS Trust [2004] 1 WLR 3002 Confirmed that an unreasonable refusal to mediate may justify a departure from the usual costs order in civil litigation. PGF II SA v OMFS Co Ltd [2014] 1 WLR 1386 Established that a failure to respond to a serious request to mediate will normally be treated as an unreasonable refusal and may be considered in the costs discretion. Garritt-Critchley and Others v Ronnan and Solarpower PV Ltd [2025] 3 Costs LR 453 Discussed the usefulness of mediation even in apparently unfavourable circumstances and the relevance of ADR in assessing litigation outcomes. DSN v Blackpool FC [2020] Costs LR 359 Emphasised the importance of complying with court directions regarding ADR, and noted that unreasonable conduct in failing to engage may affect the costs outcome. OMV Petrom SA v Glencore International AG [2017] EWCA Civ 195 Reaffirmed that litigants should make reasonable efforts to settle and respond appropriately to settlement offers, especially under Part 36. Kiam v MGN Ltd (No.2) [2002] EWCA Civ 66 Held that, in rare and extreme circumstances, an unreasonable refusal to accept a settlement offer outside the scope of CPR 36 may justify indemnity costs. Gore v Naheed [2017] 3 Costs LR 509 Affirmed that a trial judge retains discretion on whether failure to respond to mediation requests is unreasonable and may decide no costs penalty is warranted. Three Rivers District Council v Bank of England [2006] 5 Costs LR 714 Outlined categories of litigation behaviour that can justify indemnity costs, including speculative or irreconcilable claims and litigation pursued for collateral purposes. Hosking v Apax Partners LLP [2018] 5 Costs LR 1125 Recognised that litigation used as a tool to pressure settlement, rather than to resolve genuine rights, may justify an indemnity costs order.  
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Key Points

  • Where a party has overwhelmingly succeeded in litigation, the court will not reduce their costs recovery to reflect the opposing party’s minor or peripheral success on a discrete issue that had no significant bearing on the overall costs of the proceedings. [10-16]
  • A successful party will not be penalised in costs for pre-litigation conduct that the court has determined to be lawful, even if that conduct was ill-advised, provided it did not cause or materially contribute to the failure to settle the underlying dispute. [17-25]
  • A failure to respond to a request to mediate is not automatically unreasonable giving rise to a costs penalty; the court will assess the particular facts, including whether the requesting party imposed unreasonable conditions on the mediation and whether the overall circumstances rendered mediation impractical. [32-34, 76-78, 101-106]
  • There is no general obligation for a party to engage in settlement negotiations based on offers that are, in light of the eventual outcome, wholly unrealistic and substantially less favourable than the result achieved at trial. [69-75]
  • Indemnity costs may be awarded where a claim is not merely weak but is advanced on the basis of evidence that is inconsistent with contemporaneous documentation and is found to have been ‘constructed’ or concocted for the purposes of the litigation, particularly when combined with conduct suggesting the claim is pursued as a tactical instrument to pressure settlement. [40-44, 48-54]

"I tend to agree. It seems to me that this litigation was pursued by Andrew as, in effect, a continuation of his efforts, described in the handed down judgment, at paragraphs 248 to 256, to preserve, or even enhance, what he undoubtedly saw as his rightful inheritance in respect of his mother's United Kingdom estate and to ensure that, even if the Property was sold, he secured, one way or another, his 'entitlement', in respect of that estate and that he was not, in his terms and as explained in paragraphs 53 and 248 of the handed own judgment, 'disinherited'."

Key Findings In The Case

  • The Claimant’s partial success in limiting the accounting period for rental income from the sub-let flat (31A) did not meaningfully affect the overall costs of the litigation and was considered minor and peripheral to the central proprietary estoppel claim; accordingly, no reduction in the Defendants’ costs recovery was warranted on that basis [10–16].
  • The Defendants’ conduct during the pre-litigation incident on 10 June 2023—where they entered the property to confront the Claimant—was found to be lawful and did not materially hinder the possibility of early settlement; it therefore provided no justification for reducing the Defendants’ costs recovery [17–25].
  • The Claimant’s evidence in support of his proprietary estoppel claim was found to be knowingly untrue and inconsistent with contemporaneous documents; the assurances alleged were found to have been invented for the purposes of litigation, justifying an award of indemnity costs to the Defendants [48–51].
  • The Claimant unreasonably resisted mediation by imposing unacceptable participation conditions excluding the other Defendants (his brothers), despite their legitimate interest in the outcome; his refusal led to the collapse of early mediation efforts, and the Defendants’ approach to mediation was found to be reasonable in the circumstances [76–80, 101–103].
  • All four of the Claimant’s Calderbank offers were substantially less favourable to the Defendants than the outcome they achieved at trial; the Defendants’ refusal to enter settlement negotiations based on those offers was held to be reasonable, and no adverse costs consequence followed [67–75].

"This case is very far away from the situation of silent non-engagement, discussed by Briggs LJ, in PGF II. Far from failing to engage with mediation, the Defendants chose, in circumstances where they could readily and properly eschewed mediation, to contemplate mediation and to continue to do so notwithstanding unreasonable objections raised by Andrew."

The Chancery Division’s decision in Grijns v Grijns [2025] EWHC 2853 (Ch) establishes that litigation pursued as an “anvil for settlement” through invented evidence and tactical pressure will justify indemnity costs despite mediation obstacles created by both parties.

Background

The dispute concerned a four-bedroomed Georgian terraced house at 31 and 31A Bury Walk, Chelsea, valued at approximately £3.85 million. The property was purchased by Andrew Grijns’s parents in 1994 and vested in his mother, Janice Grijns, by survivorship upon his father’s death in 2019 [§4]. Andrew had lived at the property since 1999 but his licence to occupy was terminated no later than 1 August 2023.

Andrew’s primary claim was founded on proprietary estoppel, asserting entitlement to a two-thirds beneficial interest based on alleged assurances from his parents [§3]. His secondary claim sought aggravated and exemplary damages arising from an incident on 10 June 2023, when Janice and his three brothers entered the property after Andrew refused them access [§5]. Janice counterclaimed for declarations of sole ownership, mesne profits for Andrew’s unlawful occupation, and an account of profits from lettings of the self-contained flat at 31A.

The substantive judgment handed down on 12 June 2025 ([2025] EWHC 1413 (Ch)) dismissed all Andrew’s claims, declared Janice the sole owner, determined Andrew had been a trespasser since 1 August 2023, and ordered him to pay mesne profits [§§1-2]. Andrew’s only success was limiting his rental account liability to 10 May–1 August 2023, due to overlap with mesne profits liability thereafter [§2].

Costs Issues Before the Court

At the consequential hearing held on 19-20 August 2025, the defendants sought all costs on the indemnity basis, characterising Andrew’s claim as weak, speculative, and based on concocted evidence, with litigation conduct including unfounded capacity allegations and a late committal application [§8].

Andrew argued for no order as to costs, contending the defendants’ 10 June 2023 conduct warranted a 50% penalty and their failure to mediate or engage with his Calderbank offers warranted an additional 30-50% reduction—combined penalties totalling 80-100% [§17].

The Court’s Decision

Costs Follow the Event

The court held that the defendants were clear winners and costs should follow the event [§11]. The accounting issue was peripheral, having no significant impact on costs, as the factual narrative concerning the relationship between Andrew and his parents would have been examined regardless for the proprietary estoppel claim [§§13-16]. No allowance was made in Andrew’s favour.

Pre-Litigation Conduct

The court rejected Andrew’s submission that the 10 June 2023 entry warranted a costs penalty. The entry, although forcible in the literal sense, was entirely lawful and not a self-help remedy. The defendants’ intention was not to remove Andrew from possession but to attempt negotiation [§§18-20]. The approach went wrong through failure to inform Andrew of the visit, but it was Andrew’s unlawful refusal of access to his mother that triggered the confrontation [§21].

Taking a wider view, the court found no reason to believe that, absent the 10 June events, settlement would have resulted [§22]. The parties were already very far apart: Andrew asserting claims to 100% or 55% of the property whilst Janice had offered £200,000 to each child [§§23-24]. The court was satisfied the events of 10 June 2023 should have no adverse bearing on the defendants’ costs entitlement [§25].

Mediation and Settlement

The court conducted a detailed analysis and concluded the defendants’ approach had been reasonable throughout [§§76-106]. This was not a case where the defendants ever refused to mediate [§31].

The defendants proposed mediation as early as August 2023 [§79]. However, Andrew imposed unreasonable conditions by refusing to allow his brothers to participate, notwithstanding their position as defendants in the case. The court characterised Andrew’s approach as “high-handed” [§80]. The brothers were defendants against whom penal damages were sought; any sensible settlement had to embrace their position. They had a very real interest in mediation given the relief Andrew claimed would, if granted, have seriously and unfairly affected them [§80]. Moreover, Janice, elderly and in ill-health, was wholly entitled to family support at mediation, with any concerns about improper influence met by her representation by competent lawyers [§81].

Andrew later modified his position to accept his brothers’ attendance, but only for the trespass claim portion of mediation—an approach that remained inappropriate [§§84, 87]. By the time parties were contemplating post-disclosure mediation, delays in disclosure (for which both parties shared responsibility) left insufficient time for meaningful mediation pre-trial [§§88-93]. Master McQuail’s direction of 23 September 2024 recognised this “time pressure” and made only a general ADR direction [§95].

The court distinguished PGF II SA v OMFS Co Ltd [2014] 1 WLR 1386 and its “general rule” that failure to respond to mediation requests is unreasonable. This was not “silent non-engagement” [§106]. Drawing on Gore v Naheed [2017] 3 Costs LR 509, the court held that particular circumstances meant no costs penalty was warranted [§35]. The court concluded: “Far from failing to engage with mediation, the Defendants chose, in circumstances where they could readily and properly [have] eschewed mediation, to contemplate mediation and to continue to do so notwithstanding unreasonable objections raised by Andrew” [§106].

The court also held it would have been wholly reasonable for the defendants to refuse to mediate, given they properly considered Andrew’s claim unfounded and wished to contest it rather than buy him off [§78].

Calderbank Offers

Andrew made four Calderbank offers during the litigation [§67]. Given the property’s £3.85 million value, even his lowest offer of 25% would have required the defendants to pay approximately £900,000. His earlier offers demanded 55%, 40%, and 40% respectively [§§23, 67]. All offers were “well beaten” by the trial outcome, as Andrew recovered nothing and faced substantial liabilities [§§68-69].

The court rejected Andrew’s submission, founded on OMV Petrom SA v Glencore International AG [2017] EWCA Civ 195, that the defendants should have engaged in negotiation [§§29, 73]. Whilst parties should make reasonable efforts to settle and engage with reasonable offers, this does not compel a litigant confronted by wholly unrealistic offers to waste time and costs dealing with them [§74]. The court distinguished Kiam v MGN Ltd (No.2) [2002] EWCA Civ 66: there, the refused offer was better than the eventual outcome, whereas here Andrew’s offers fell very substantially short of the defendants’ complete success [§§71-73].

Indemnity Costs

Indemnity costs were awarded for the main litigation on multiple grounds establishing conduct outside the norm [§§39-65].

The Legal Framework

The court set out the broad principles: conduct must be outside the “norm,” with no need for findings of impropriety or dishonesty, though such findings pave the way for indemnity orders. The court retains discretion not to award indemnity costs even where conduct is demonstrably outside the norm [§§40-41].

Applying Three Rivers District Council v Bank of England [2006] 5 Costs LR 714 and drawing on Hosking v Apax Partners LLP [2018] 5 Costs LR 1125, the court identified circumstances guiding towards indemnity costs orders: (from Three Rivers) speculative, weak, opportunistic or far-fetched claims irreconcilable with contemporaneous documents; and (as added by Master Bowles) cases where evidence is, in material respects, dishonest, and where the true purpose is to exact settlement rather than achieve adjudication on merits [§§42-43].

Invented Evidence

The court found Andrew’s proprietary estoppel claim was not merely weak but based on assurances that had been invented and on evidence about those assurances that had been “constructed” for litigation purposes [§§44-51]. Although determination required lengthy factual enquiry, “this was, when that enquiry was completed, always a very weak claim, which failed at every level” [§44].

None of the pleaded ingredients were established. The alleged assurances were never made and, correspondingly, there was no reliance [§47]. The court stated: “In blunt terms, the assurances, which constituted the core of Andrew’s case, were and must have been invented, as part of the ‘constructive’ process” [§48].

Andrew’s case was tested against substantial contemporaneous evidence. None of the contemporaneous material supported Andrew’s case; much was wholly inconsistent with it [§§49-50]. This was precisely the type of case identified in Three Rivers: a claim “far fetched and irreconcilable with the contemporaneous documents” [§42].

Anvil for Settlement

The court considered that Andrew’s conduct could properly be seen as using litigation as an “anvil for settlement”—adopting Hildyard J’s phrase from Hosking—rather than pursuing adjudication on genuine merits [§§52-54]. The court stated: “It seems to me that this litigation was pursued by Andrew as, in effect, a continuation of his efforts… to preserve, or even enhance, what he undoubtedly saw as his rightful inheritance” [§53].

The court concluded: “Andrew was prepared to ‘construct’ a case and assert assurances by his mother that were never made, in the hope, not realised, that a settlement would be achieved and the claim would not be fully investigated at a trial” [§54].

Capacity Allegations

Over and above the pressure implicit in pursuing unfounded litigation against an elderly woman, Andrew chose to raise and plead capacity issues [§§55-61]. Capacity was raised on two occasions before litigation, repeatedly referenced during proceedings, but never formally abandoned and never properly pursued at trial [§§56-57].

The court found Andrew was never prepared to “follow through” on the capacity issue. If he had genuinely believed Janice’s capacity was in question, he could and should have applied to the court or secured medical evidence. He did neither [§61]. The court concluded: “I am left with the clear conclusion… that the entire capacity issue was never intended for determination but was raised to enhance the pressure on his mother to settle his unfounded claim” [§61].

Tactical Committal Application

Andrew issued committal proceedings against Janice on 11 October 2024, just over one month before trial, founded upon three intemperate messages from August 2023 [§62]. The application was never pursued. The court found the timing “hard not to see… as anything other than an attempt to impose additional pressure on Janice, in the period immediately prior to trial, while, at the same time, inevitably disrupting trial preparation” [§63]. The allegations were “historic” and should have been raised timeously if genuinely concerning [§63].

The court concluded: “Andrew’s motives in respect of the application were not founded in a genuine belief that he had been damaged by his mother’s conduct, in a way that required the exercise of the court’s contempt jurisdiction, but were concerned, rather, with the tactical imposition of pressure upon his mother, in the hope of facilitating a settlement, in his favour, of what I reiterate to have been wholly unfounded litigation” [§64].

The Order

The court stated: “In the result, I am entirely satisfied that, standing in isolation, Andrew’s conduct of this litigation clearly warrants an order for indemnity costs and that there is no discretionary reason not to make such an award” [§65].

However, post-judgment costs were awarded on the standard basis as Andrew’s challenges to the costs order, though unsuccessful, were not unreasonable [§108]. Consequently, Andrew was ordered to pay all costs of the claim and counterclaim on the indemnity basis, save for post-judgment costs on the standard basis [§107].

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