Co-Claimants Pursuing Common Case Face Joint And Several Liability For Adverse Costs

Where multiple claimants pursue interconnected claims relying on common allegations, the court may order joint and several liability for adverse common costs—even absent a Group Litigation Order—requiring claimants to reassess their ATE cover before incurring substantial trial preparation costs.

BARONESS LAWRENCE & ORS v ASSOCIATED NEWSPAPERS LIMITED [2025] EWHC 3207 (KB)

In Baroness Lawrence & Ors v Associated Newspapers Ltd [2025] EWHC 3207 (KB), Senior Master Cook and Mr Justice Nicklin determined two costs applications in multi-party litigation. The first was the defendant’s application for a prospective order on adverse costs liability. Exercising its case management powers under CPR 3.1 and applying Stumm v Dixon (1889) 22 QBD 529, the court held that any unsuccessful claimant would be severally liable for the defendant’s ‘Individual Costs’ but jointly and severally liable with other unsuccessful claimants for ‘Common Costs’. The court found it imperative to determine this issue pre-trial so claimants understood the consequences of their litigation strategy before incurring substantial trial costs. The second issue concerned competing CPR 3.15A budget variation applications. The court allowed variations for both parties at reduced sums, notably holding that costs of maintaining a legacy email archive (£357,919) were recoverable legal costs, not business overheads. The court also directed amendment of the November 2024 order to constitute a proper costs management order under CPR 3.15(2).

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... 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… 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.

Citations

Baroness Lawrence & Ors v Associated Newspapers [2025] EWHC 106 (KB) The judgment discussed the court’s wide discretion under CPR 44.2 and CPR 3.1 to manage costs, including the power to adopt costs sharing principles similar to those under Group Litigation Orders despite no GLO being made. Hammon v University College London [2024] EWHC 1744 (KB) The court held that CPR 46.6 principles could be imported into a costs management order to ensure fairness in the allocation of potential cost liabilities in the absence of a GLO. Stumm v Dixon (1889) 22 QBD 529 Established the principle that parties jointly pursuing a claim are each liable for the full amount of common costs, and only severally liable for their respective individual costs. Dufoo v Tolaini / Re Quiet Moments Ltd [2014] EWCA Civ 1536 Affirmed that the Stumm v Dixon principle applies equally to claimants and defendants concerning liability for common and individual costs. Rowe v Ingenious Media Holdings plc [2020] EWHC 235 (Ch) Clarified that courts should assess the nature of claims when deciding on joint versus several liability for costs, especially where multiple claimants present a collective case supported by common issues. Ontulmus v Collett [2014] EWHC 4117 (QB) Cited in support of the court’s approach to managing collective claims and the cost consequences arising from claims relying on common factual foundations. London Scottish Benefit Society v Chorley and others [1884] 13 QB 872 Confirmed that recoverable litigation costs must be legal costs that the court can measure, arising from professional services or litigation-specific expenses.

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Key Points

Where multiple claimants effectively combine to present claims based on common allegations against a single defendant, the court may order that each claimant is jointly and severally liable for the adverse costs relating to the common elements of the litigation, and severally liable only for costs specific to their individual claim.
The court may determine the basis for adverse costs liability at a case management stage, before the conclusion of proceedings, where it is imperative to provide the parties with clarity on the financial consequences of their collective litigation strategy before they incur substantial further costs.
A party seeking to vary an approved costs budget under CPR 3.15A must demonstrate a ‘significant development’ in the litigation, which is an event, circumstance, or step of such a size and nature as to go beyond what was taken into account, expressly or impliedly, in the previously approved budget.
When assessing a proposed budget variation, the court is not bound by any offer made between the parties and retains a complete discretion to approve a sum it considers reasonable and proportionate for the work attributable to the significant development.
Expenditure incurred solely to preserve evidence for the purposes of ongoing litigation, such as maintaining a legacy data archive, can be allowed as a budget variation if the evidence demonstrates the cost is incurred only by reason of the litigation and was not previously factored into the budget.

"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 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.'"

Key Findings In The Case

The court found that the Claimants had combined to advance a collective litigation strategy grounded in common allegations against the Defendant, meaning that the costs incurred in defending the core shared issues were Common Costs for which each Claimant is jointly and severally liable in any adverse costs award, even though the claims were not formally consolidated under a Group Litigation Order [25–26, 30].
The court determined that it was necessary, given the scale and nature of the litigation, to rule on the Claimants’ potential liability for Common Costs at the case management stage, rather than deferring to the conclusion of proceedings, so that the parties—particularly the individual Claimants—could understand and make financial provision for their exposure to adverse costs in advance of trial [31–32].
The court found that the Claimants’ budgeted figures for the “Issue/statements of case” phase were excessive and included work beyond the permissible scope of replies (e.g., pleading new facts as to the Ward Allegations), and accordingly reduced the variation sought from £36,120 to £20,000 as the amount reasonably and proportionately required for that work [41–43].
The court accepted that the Defendant’s additional expenditure of £357,919 to maintain access to its legacy email archive arose solely from the litigation (due to the Claimants’ insistence that the archive be preserved for disclosure purposes), and therefore constituted recoverable litigation costs for budgeting purposes under CPR 44.1 [59–65].
The court found that the Claimants’ alleged need to increase After-the-Event (ATE) insurance premiums following clarification of joint and several liability for Common Costs did not justify deferring a costs liability order, as ATE decisions and insurance strategy must be guided by actual legal exposure and not presupposed costs outcomes [8–9, 14, 31].

"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 High Court’s decision in Baroness Lawrence of Clarendon OBE & Ors v Associated Newspapers Limited [2025] EWHC 3207 (KB) confirms that claimants combining to pursue a common factual case may face joint and several liability for the defendant’s common costs, with significant implications for ATE insurance structuring in multi-party litigation.

Background

A group of seven high-profile individuals, including Baroness Lawrence, Sir Elton John, and Prince Harry, the Duke of Sussex, brought separate claims against Associated Newspapers Limited (the Defendant). Their individual claims have been case managed together and are heading towards a combined trial of all issues in all claims [§11]. A key feature of the litigation was that each claimant relied not only on allegations specific to them but also on a substantial body of similar fact and generic allegations common to all claims. Each claimant’s pleading expressly relied on the common allegations as a “modus operandi” supporting their individual case [§10].

At a costs and case management conference (CCMC) in November 2024, the court made an order that included definitions for ‘Individual Costs’ and ‘Common Costs’ for the purposes of costs management and for sharing the claimants’ own costs amongst themselves [§5]. This order did not, however, address the potential liability of the claimants for any adverse costs orders in favour of the Defendant [§6–7]. Following that order, the claimants obtained After-The-Event (ATE) insurance policies totalling approximately £14.1 million (£2.35 million per claimant), calculated on the basis of several liability for any adverse costs [§9, §19]. The Defendant subsequently applied for a determination on the nature of the claimants’ potential liability for costs. Separately, both parties applied to vary their court-approved costs budgets upwards, citing significant developments in the litigation.

Costs Issues Before The Court

The court was required to determine two discrete costs issues. The first was the Defendant’s application for an order specifying that, if any claimant was ordered to pay costs to the Defendant, they would be severally liable for their own ‘Individual Costs’ but jointly and severally liable with any other unsuccessful claimant(s) for the Defendant’s ‘Common Costs’ [§3]. The second issue concerned the competing applications by both the claimants and the Defendant to increase the budgets for several phases of the litigation, namely: Issue/Statements of Case, CMC, Disclosure, and Witness Statements [§33].

The Parties’ Positions

- The Defendant’s Position on Costs Liability: The Defendant, represented by Roger Mallalieu KC, argued that the claimants were pursuing a collective strategy based on common allegations, with each claimant’s case relying on and supporting the others [§10–11]. Citing authorities including Stumm v Dixon (1889) 22 QBD 529, Dufoo v Tolaini [2014] EWCA Civ 1536, Rowe v Ingenious Media Holdings plc [2020] EWHC 235 (Ch), and Ontulmus v Collett [2014] EWHC 4117 (QB), it was submitted that where parties combine to present a common claim or defence, the established principle is that they are jointly liable for the costs of that common endeavour [§12]. The Defendant relied on the claimants’ correspondence seeking several liability and on their ATE arrangements as reasons to determine costs liability at this stage [§8–9].
- The Claimants’ Position on Costs Liability: The claimants, represented by Andrew Hogan, resisted the application [§15]. They argued that costs orders should ordinarily be made at the end of a case and that no good reason had been shown for a pre-emptive order [§16]. They submitted that their claims remained separate, with distinct individual elements, and that their ATE insurance had been reasonably obtained on a several liability basis [§19]. Imposing joint and several liability now could force them to seek additional, costly insurance cover to guard against the risk of being left solely liable for common costs if a co-claimant could not pay [§9, §19]. In the alternative, they argued that if an order was made, it should be for several liability only, citing factors including that these were separate claims brought by seven individuals in six claims, represented by three firms of solicitors [§22].
- Positions on Budget Variations: Both parties filed Precedent T forms seeking increases in four phases of their budgets: Issue/Statements of Case, CMC, Disclosure and Witness Statements [§33]. The claimants relied on the need for Amended Replies, an additional CMC, extra disclosure work and the increased number of Defendant witness statements [§39, §48, §55, §66]. The Defendant pointed to the burden of answering significantly amended Particulars of Claim, the additional CMC, the costs of maintaining a legacy email archive and the increased number of its own witness statements [§44, §52, §59, §70]. The court then applied CPR 3.15A, assessing in each case whether there had been a ‘significant development’ and what sums were reasonable and proportionate [§34–37].

The Court’s Decision

Costs Liability Application: The court granted the Defendant’s application [§23]. It held it had jurisdiction under its wide case management powers (CPR 3.1) to make such an order, and that costs sharing orders had become “commonplace in multi-party actions where parties combine to litigate common issues” [§24].

The court applied the principle from Stumm v Dixon 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 [§25–26]. The court referred to Rowe v Ingenious Media Holdings plc, noting that it emphasised the need to pay particular attention to “the nature of the claim” when deciding whether to order joint or several liability for costs [§27]. The present case was materially different: the claimants’ cases depended “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” [§30].

The court rejected the argument that the decision should be deferred. It considered it “imperative” that the claimants understood the consequences of the way the litigation was being conducted, particularly given the substantial costs already incurred and further substantial trial-preparation costs to come [§31]. The fact that the claimants might need to reassess their ATE insurance was “in their own best interests” and not a reason to refuse the order [§31]. The order would not “tie the court’s hands” if circumstances later justified a departure [§32].

Budget Variations: The court assessed each variation request against the test in CPR 3.15A, requiring a ‘significant development’ in the litigation [§34–36]. It noted 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” [§37].

For the Claimants:

- - Issue/Statements of Case: Sought £139,295 (£36,120 time costs plus £103,175 disbursements); allowed £20,000 [§39–43]. The court found the Replies went beyond their proper function and, regarding the Ward Allegations, “impermissibly advanced a factual case that contradicted the case advanced in the Particulars of Claim” [§42].
  - CMC: Sought £200,000; allowed £200,000 in full [§48–51]. A further CMC was a significant development not previously contemplated.
  - Disclosure: Sought £495,520; allowed £80,000 [§55–58]. The court held the claimants were “largely responsible for their own failure to undertake the disclosure exercise properly in the first place” and had only obtained “several discrete but limited orders for disclosure against the Defendant” [§57].
  - Witness Statements: Sought £175,000; allowed £50,000 [§66–69]. The budget had assumed the Defendant would serve a maximum of 30 witness statements; 11 further statements required consideration, which constituted a significant development.

For the Defendant:

- - Issue/Statements of Case: Sought £958,558; allowed £95,000 [§44–47]. The court accepted this was a “more legitimate” request given the claimants’ “significant amendments” imposing “a significant burden to answer and investigate new allegations” [§46]. The preparation of supplemental witness statements could not fall within this phase.
  - CMC: Sought £200,000; allowed £200,000 in full [§52–54].
  - Disclosure: Sought £424,439 (including £357,919 for server costs); allowed £357,919 [§59–65]. The claimants argued that the cost of maintaining a legacy email archive was a business overhead and not a “legal cost” under CPR 44.1, citing London Scottish Benefit Society v Chorley (1884) 13 QBD 872. The court rejected this argument, accepting the Defendant’s evidence that the server cost was “only being incurred by reason of this litigation” and was therefore an expense “necessarily arising from the litigation and necessarily caused by the course which it takes” [§64–65].
  - Witness Statements: Sought £250,800; allowed £90,000 [§70–73]. The increase in witness numbers was “because the scope of the claim has expanded by amendment, bringing in new allegations” [§72].

The court also noted that the November 2024 order required amendment to constitute a proper costs management order as mandated by CPR 3.15(2), observing that “parties seldom draft proper or effective costs management orders” [§74–77].

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