We are all aware by now of the ongoing ‘Wagatha Christie’ legal battle between Rebekah Vardy and Coleen Rooney. The trial of Mrs Vardy’s libel claim against Mrs Rooney took place in July 2022. So why are we still talking about it now? Well, Mrs Vardy is challenging Mrs Rooney’s costs.
| The Wagatha Christie trial
At the end of the trial, the Judge found in Mrs Rooney’s favour. Along with judgment for Mrs Rooney, the court ordered that Mrs Vardy pay her costs. So far, so regular. However, as Mrs Vardy had repeatedly displayed poor conduct throughout the proceedings (including failing to engage in ADR and filing misleading witness statements), the court ordered costs on an indemnity basis.
| The Costs Budgets
On the build up to a trial, both parties must provide the Court with details of their costs incurred to date. The parties estimate the costs that they will incur all the way to trial, including the solicitors’ fees and any disbursements. This is known as a Costs Budget (submitted in a format known as Precedent H).
Pre-Wagatha Christie trial, the parties filed their Costs Budgets. Mrs Vardy’s stood at £897,000 at first instance, whereas Mrs Rooney’s was around only £500,000. And this is where the new dispute begins.
| The costs proceedings
Mrs Rooney filed a Bill of Costs as part of the costs assessment. But it was not in the region of the £500,000 in the Costs Budget, but in fact £1.8 million, based on the indemnity principle.
So, Mrs Vardy, unsurprisingly, raised with the court the huge disparity between Rooney’s costs budget and her bill of costs. The court dealt with it as a preliminary issue in the costs proceedings earlier this month.
| The disparity
Jamie Carpenter KC, for Vardy, argued that Rooney’s solicitors had committed misconduct by grossly understating the incurred costs in a Precedent H with a statement of truth.
The statement of truth required for a costs budget states:
‘This budget is a fair and accurate statement of incurred and estimated costs which it would be reasonable and proportionate for my client to incur in this litigation.’
Robin Dunne, for Rooney, submitted that the costs budget only included the proportionate costs (as required by the statement of truth). He suggested that the actual costs incurred and estimated would have been deemed to be disproportionate, so they did not include them. Therefore, there was no misconduct.
This meant that when they submitted their bill of costs calculated on the indemnity basis (without a requirement to be proportionate), it was much higher.
| Senior Costs Judge’s decision
Senior Costs Judge Andrew Gordon-Saker ruled that Rooney’s solicitors understating the incurred costs in a Precedent H was not misconduct. He said, “it is not in issue that Mrs Rooney’s lawyers put in her budget incurred costs at significantly less than had actually been incurred, despite the fact they were criticising Mrs Vardy’s lawyers for spending more time”.
He added “The costs included within the Precedent H were those that the conducting solicitor at the time viewed to be proportionate in the litigation”.
The Judge agreed that “given the lack of clarity in the wording of the statement of truth [in the Precedent H form] and the competing interpretations that have been argued I cannot say that Mrs Rooney’s solicitors’ interpretation amounted to unreasonable or improper conduct. There is logic in Mr Dunne’s argument that a solicitor who had concluded he could only include reasonable and proportionate costs in the incurred would assume that the other party have done the same”.
The costs judge suggested that the rules committee looks at the Precedent H statement of truth to see whether it is sufficient.
| New tactic for defendants?
So, could Rooney’s decision to file a lower costs budget be a new tactic for Defendants to reduce the possible costs liability?
Or were Mrs Rooney’s solicitors playing a dangerous game? Relying upon getting an indemnity costs award to be able to recover their actually incurred costs rather than those agreed in the budget.
If the Court had not made the award of indemnity costs in favour of Mrs Rooney, then her costs recovery would have been limited to the amount allowed under the agreed budget of £540,779, except for the concept of “good reason”.
| A reminder on conduct and the impact on costs
This case is a warning to parties on how conduct could have a dramatic impact on your potential cost liability; and how your conduct during the proceedings is important to protect your position.
Robin Dunne’s written submissions suggested that Vardy’s conduct meant “significant additional costs were required to be incurred”. He claimed that Vardy’s “argument appears to arise from her frustration that her deplorable conduct in this litigation has led to the budgets becoming irrelevant”.
He went on to say it was “unsurprising that indemnity basis costs were ordered in these circumstances. The Claimant’s conduct clearly made this case extremely unusual and very much “out of the norm” for libel claims”
The documents explained “This was a libel claim which [Vardy] chose to launch, despite knowing that the Instagram post was true. [Vardy] refused to engage to try to avoid these proceedings and by her conduct meant that significant additional costs were required to be incurred”.
Dunne suggested that “solicitors and counsel were faced with an opponent in a claim of the very highest profile, who was destroying evidence, withholding evidence, filing untruthful statement summaries from the witnesses and refusing to be truthful at trial”.
Therefore, this again shows how the parties’ failure to engage in the process and the overreaching duty to try to settle a matter could massively increase your potential liability and costs awards being made against you.
The main costs hearing is due to take place in January 2025, where we will find out just how much the court orders Mrs Vardy to pay.
For expert costs advice, assistance in preparing costs budgets, or bills of costs, contact our experienced costs team. Call us on 0800 988 7756, or contact us through our online form.
