The Intermediate Court has awarded BND38,000 in party-and-party costs, together with BND1,845 in full disbursements, following a dispute over rental arrears between Abdul Razak Holdings and Yura Eskandar bin PDPJ Haji Mohd Yusof, trading as Mufakat Trading Company.
The ruling on costs was delivered by Intermediate Court Judge Hazarena POKSJ DP Haji Hurairah in August.
The substantive proceedings concerned a claim for rental arrears arising from a tenancy agreement. Following a full trial, judgment was entered in favour of Abdul Razak Holdings for BND29,011.25, with costs to be agreed or assessed by the Court.
As the parties could not agree on costs, the Plaintiff submitted a Schedule of Costs claiming BND52,015, inclusive of disbursements.
The Plaintiff argued that the amount claimed reflected substantial work undertaken throughout the litigation, which had continued for approximately four years.
This included preparation of pleadings, discovery, documentary bundles, affidavits, witness preparation, legal research, case management conferences, trial preparation and attendance at the multi-day trial.
The Plaintiff also argued that its costs had been increased by the Defendant’s conduct, including changes in legal representation and several adjournments. It submitted that these resulted in duplicated preparation, additional attendances and further work which would not otherwise have been necessary.
The Defendant accepted that the Plaintiff was entitled to costs as the successful party but argued that BND52,015 was excessive, unreasonable and disproportionate.
The Defendant relied on Order 59, Appendix 1 of the Rules of the Supreme Court, submitting that the Court should consider factors including the complexity of the proceedings, the amount involved and the work reasonably undertaken.
The Defendant also pointed to the Court’s earlier observation that the dispute “ought never to have required a full trial” and was principally a matter of accounting and calculation rather than a complex legal dispute.
It was further argued that some of the costs claimed overlapped and that the Plaintiff should not recover more than was reasonably necessary for the conduct of the proceedings.
Court’s assessment
The Court agreed that the BND52,015 claim was not entirely reasonable or proportionate.
Although the Plaintiff’s solicitors had undertaken considerable work, the Court found that the litigation was neither legally nor factually complex. The principal issues concerned the tenancy agreement, a rental incentive scheme and the calculation of rental arrears. Issues of waiver and estoppel were also raised, but these involved established legal principles rather than novel questions of law.
The Court nevertheless accepted that the Defendant’s conduct had materially increased the Plaintiff’s costs.
Repeated adjournments, changes in legal representation and the unavailability of a defence witness required the Plaintiff to undertake additional preparation and attend hearings that did not proceed.
However, the Court noted that some interlocutory costs had already been awarded in respect of particular adjournments. Those amounts could not be recovered again through the present assessment.
Rather than examining every item in the Schedule individually, the Court adopted a global assessment, taking into account the nature of the proceedings, the amount in dispute, the work required, the procedural history and proportionality.
The Court held that party-and-party costs are intended to provide fair and reasonable compensation, rather than complete reimbursement of every expense incurred by the successful party.
The Court therefore reduced the Plaintiff’s claim from BND52,015 to BND38,000, while allowing the Plaintiff its full disbursements of BND1,845.
The total award was therefore BND39,845.