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Post Office class action litigation costs continue to mount

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A recent costs hearing at the High Court in London has revealed the extent of the legal costs already accumulated in the high-profile Bates v Post Office litigation action. The class action claim, backed by litigation funders Therium Capital, involves over 500 former subpostmasters and mistresses who are claiming that the Post Office, following the implementation of a new IT system called ‘Horizon’, incorrectly blamed them for apparent shortfalls in branch accounts.

The hearing disclosed that costs on both sides have now topped £35m, prompting Mr Justice Fraser to comment that some costs incurred seemed ‘excessive’.

The barristers representing the claimants, Henderson Chambers, argued that the Post Office has spent more than the 555 claimants, citing a figure of £19.5m compared with £16.828m. They also pointed out that the Post Office has employed two law firms and as a result is instructing over 20 different fee earner grades across both of these firms.

Barristers 1 Essex Court, representing the defendants, said that the litigation was ‘not a David and Goliath case’, stating ‘while it is true to say the Post Office’s costs are higher…it is not chalk and cheese’.

Mr Justice Fraser said it is “unusual’ that the Post Office has employed two sets of solicitors, stating that the set-up ‘gave rise to a concern about duplication”. The defendant declined the chance to provide material showing there was no overlap between the firms’ work. Fraser J recorded a comment on the Post Office's costs, stating: “The total time costs appear to be excessive based on the fact that individual particulars of claim in four cases have not yet been served.” He added that the defendant’s incurred costs also appear to be ‘extremely high’. He said costs could have been driven up by the number of claimants, the time the proceedings have taken and the fact two firms are being instructed.

For the claimants, the judge made a cost management order of £2.814m to be spent on the third trial as well as alternative dispute resolution, mediation, settlement discussions. He also allocated £900,000 for the Post Office to spend on alternative dispute resolution.

 

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