Samco Europe, The Owners or Charterers of the Ship v MSC Prestige, The Owners or Charterers of the Ship, Court of Appeal - Admiralty Division, June 30, 2011, [2011] EWHC 1656 (Admlty)

Resolution Date:June 30, 2011
Issuing Organization:Admiralty Division
Actores:Samco Europe, The Owners or Charterers of the Ship v MSC Prestige, The Owners or Charterers of the Ship
 
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Neutral Citation Number: [2011] EWHC 1656 (Admlty)

Case No: 2009 FOLIO 1313

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

ADMIRALTY COURT

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 30/06/2011

Before :

MR. JUSTICE TEARE

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Between :

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Nigel Jacobs QC (instructed by Ince & Co.) for the Claimants

Jeremy Russell QC and Benjamin Coffer (instructed by Thomas Cooper) for the Defendants

Hearing dates: 23 June 2011

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Judgment

Mr. Justice Teare :

1. Following my judgment on liability in this action the Owners of SAMCO EUROPE sought an order that there be cross-liabilities for costs incurred before 1 October 2009 in the same proportions as liability in the action but that the Owners of MSC PRESTIGE should pay the costs of the Owners of SAMCO EUROPE incurred after 1 October 2009 and that the Owners of MSC PRESTIGE were not entitled to recover any of their own costs incurred after that date. This order was sought because on 9 September 2009 the Owners of SAMCO EUROPE offered to agree that liability be apportioned 60:40 in their favour which was the same apportionment which I judged to be appropriate in my judgment on liability. The Owners of MSC PRESTIGE objected to that order because the offer made on 9 September 2009 was withdrawn on 4 February 2011 when the Owners of SAMCO EUROPE offered to agree that liability be apportioned two-thirds/one-third in their favour which was of course more favourable to them than my judgment on liability. The Owners of MSC PRESTIGE submitted that there should be cross-liabilities on costs in the same proportion as liability in the action.

2. The disagreement between the parties has arisen, at least in part, because the case of the Owners of MSC PRESTIGE is supported by the decision of the Court of Appeal in The Toni [1974] 1 Lloyd's Reports 489 whilst the case of the Owners of SAMCO EUROPE is supported by a later line of authority commencing with the decision of the Court of Appeal in Bristol and West Building Society v Evans Bullock dated 5 February 1996 (unreported) in which no reference was made to the decision in The Toni. Mr. Jacobs QC, counsel for the Owners of SAMCO EUROPE has urged me to follow the reasoning in the line of authority stemming from Bristol and West Building Society v Evans Bullock and Mr. Russell QC, counsel for the Owners of MSC PRESTIGE has urged me to follow the reasoning in the earlier decision of The Toni.

The facts

3. The collision between the vessels occurred on 8 December 2007.

4. On 17 June 2009 Thomas Coopers, the solicitors acting on behalf of the Owners of MSC PRESTIGE made an offer to settle liability 60:40 in favour of MSC PRESTIGE. That offer was described as a ``Part 61 and/or Part 36 offer''.

5. On 9 September 2009 Ince and Co., the solicitors acting on behalf of the Owners of SAMCO EUROPE, made an offer to settle liability 60:40 in favour of SAMCO EUROPE. That offer was described as having been made ``in accordance with CPR Part 61.4(10-(12) and/or Part 36.''

6. In December 2009 Collision Statements of Case were exchanged. In March 2010 an order for directions was made. Disclosure and exchange of witness statements took place in about August 2010. Both parties employed nautical experts to assist them in interpreting the data obtained from each vessel's VDR (see paragraph 2 of my judgment on liability). On 3 and 4 February 2011 a mediation took place.

7. By letters dated 4 February 2011 Ince and Co. withdrew their offer dated 9 September 2009 and offered to settle liability two-thirds:one-third in favour of SAMCO EUROPE. That offer was also described as having been made ``in accordance with CPR Part 61.4(10)-(12) and/or Part 36''.

8. The trial took place on 11-13 April 2011 and judgment was given on 23 June 2011. Liability for the collision was apportioned 60:40 in favour of SAMCO EUROPE.

The relevant rules

9. CPR Part 36 deals with offers to settle and provides for offers made in accordance with Part 36 to have certain costs consequences. Part 36.14(6) provides that the costs consequences set out in that rule do not apply to an offer that has been withdrawn. However, CPR Part 44.3 provides that in deciding what order to make about costs the court must have regard to an admissible offer which is not an offer to which costs consequences under Part 36 apply.

10. CPR Part 61 applies to Admiralty claims and Part 61.4 contains special provisions relating to collision claims. Offers to settle collision claims are dealt with in Part 61.4 (10)-(12). It is necessary to set those paragraphs out in full:

``(10) The consequences set out in paragraph (11) apply where a party to a claim to establish liability for a collision claim (other than a claim for loss of life or personal injury)-

(a) makes an offer to settle in the form set out in paragraph (12) not less than 21 days before the start of the trial;

(b) that offer is not accepted; and

(c) the maker of the offer obtains at trial an apportionment equal to or more favourable than his offer.

(11) Where paragraph (10) applies the parties will, unless the court considers it unjust, be entitled to the following costs-

(a) the maker of the offer will be entitled to-

(i) all his costs from 21 days after the offer was made; and

(ii) his costs before then in the percentage to which he would have been entitled had the offer been accepted; and

(b) all other parties to whom the offer was made-

(i) will be entitled to their costs up to 21 days after the offer was made in the percentage to which they would have been entitled had the offer been accepted; but

(ii) will not be entitled to their costs thereafter.

(12) An offer under...

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