In preparing for litigation, the view is often taken that it is best to “throw in the kitchen sink” and to put forward every possible argument irrespective of its chances of success. However, recent decisions of the High Court confirm that those who waste court time and resources must be prepared to pay the price.
One such decision came in the passing off action taken by P McCambridge Ltd (McCambridges) against rival baker, Joseph Brennan Bakeries (Brennans) over the packaging of its wholewheat sliced brown bread. One of McCambridges’ claims was that new packaging introduced by Brennans in January of this year was a deliberate copy of the packaging used for its wholewheat brown bread and was intended to confuse its customers.
The High Court accepted that Brennans’ new packaging was likely to confuse customers and granted an injunction restraining Brennans from selling its wholewheat brown bread in packaging confusingly similar to that of McCambridges (Note: this decision is under appeal to the Supreme Court). However, the Court rejected the argument that Brennans had deliberately copied McCambridges’ packaging in order to gain market share.
In litigation, the usual practice is that the “losing” party pays the costs of the “winning” party. Yet, in this instance, the Court allowed McCambridges to claim only 40% of its costs from Brennans. The Court noted that McCambridges’ claim that Brennans acted deliberately took up a significant amount of court time and significantly added to the number of documents required to be produced. The judge, Mr Justice Michael Peart, referred to the need to apportion costs in percentage terms to encourage litigants not to raise arguments which have “a less than reasonable prospect of success”.
A decision of the High Court in an action for breach of contract against Sean Dunne’s former cleaner, Ms Gina Farrell, is also of interest in this regard. The Court was extremely critical of both parties for taking up seventeen days of court time during what was probably the busiest period of the High Court year. Ms Justice Mary Laffoy referred to the necessity of the court to “impose a price” to deter parties from unnecessarily prolonging litigation. In making a decision on costs, the judge stated that she could not overlook Ms Farrell’s dishonest conduct which was “the key contributory factor in the unnecessarily prolonged duration of the hearing”. Although the claimant only succeeded on one of its five grounds, the Court made a full costs order against Ms Farrell.
As court time and resources are funded by the public purse, the approach of the courts to those who unnecessarily add to the expense of litigation is to be respected.
Contributed by Owen O’Sullivan and Barry Cahir.
