Larpin, Christian Alfred and another v Kaikhushru Shiavax Nargolwala and another

• Jurisdiction: Singapore
• Judge: Roger Giles IJ
• Judgment Date: 26 August 2022
• Neutral Citation: [2022] SGHC(I) 12
• Citation: [2022] SGHC(I) 12
• Court: International Commercial Court (Singapore)
• Published date: 31 August 2022
• Docket Number: Suit No 3 of 2020
• Plaintiff Counsel: Christopher Anand Daniel and Harjean Kaur (Advocatus Law LLP)
• Defendant Counsel: Ramesh Kumar s/o Ramasamy and Edmond Lim Tian Zhong (Allen & Gledhill LLP)
• Subject Matter: Civil Procedure,Costs,Principles,Reasonable costs
• Hearing Date: 05 November 2021,27 October 2021,27 September 2021,28 September 2021,29 September 2021,30 September 2021,29 June 2022

Roger Giles IJ:

The judgment in the substantive proceedings, Larpin, Christian Alfred and another v Kaikhushru Shiavax Nargolwala and another [2022] SGHC (I) 4, was given on 21 February 2022 (“the Main Judgment”). The proceedings were dismissed, and it was ordered that the plaintiffs pay the defendants’ costs of the proceedings. In a further judgment given on 25 April 2022, Larpin, Christian Alfred and another v Kaikhushru Shiavax Nargolwala and another [2022] SGHC(I) 7 (“the Indemnity Costs Judgment”), the defendants’ application for an order that the costs be on the indemnity basis from a particular date was dismissed, and it was ordered that the defendants pay the plaintiffs’ costs of the application. Submissions were then received on the respective costs amounts, in writing and orally. This is the determination of the net amount payable by the plaintiffs to the defendants.

The parties were able to agree on the amount for disbursements inclusive of any GST applicable (S$15,840.78) and the amount for a pre-trial application to adduce evidence by video link (S$2,500) to be paid by the plaintiffs to the defendants. They were unable to agree on the amounts for profit costs for the substantive proceedings, for the indemnity costs application, and for this determination.

The applicable costs regime

This is a transfer case. The proceedings were commenced in the High Court on 7 October 2019 and were transferred to the Singapore International Commercial Court (“the SICC”) on 2 April 2020. At the time of transfer, it was ordered that O 110 r 46 of the Rules of Court (2014 Rev Ed) (“the Rules”) “is to apply to the assessment of costs in respect of proceedings in and arising from [the High Court proceedings] after its transfer…”. Strictly, therefore, pre-transfer costs for the substantive proceedings should be determined as costs under O 59 r 27 of the Rules, including with reference to Appendix G of the Supreme Court Practice Directions (“Appendix G”), and post-transfer costs should be determined as costs under O 110 r 46. Further, Appendix G may be a factor to be borne in mind in determining the amount of costs under O 110 r 46: CBX and another v CBZ and others [2022] 1 SLR 88 at [39].

Sensibly, the parties were agreed that the work done prior to transfer was unlikely to be significant, and that costs should be determined wholly under the SICC regime of O 110 r 46. It was also common ground that in this case, at least in relation to the costs of the substantive proceedings, that regime should be applied without particular regard to Appendix G – as was accepted by Mr Christopher Anand Daniel for the plaintiffs, that it “doesn’t count for much”.

Entitlement to reasonable costs

Under O 110 r 46(1), the unsuccessful party is to pay the “reasonable costs” of the successful party, unless the court orders otherwise. The rule does not elaborate on what are reasonable costs, but paragraph 152(3) of the SICC Practice Directions state that reasonable costs are in the discretion of the court and lists, non-exhaustively, circumstances which the court may consider. As well as the conduct of the parties, the circumstances include the amount or value of any claim involved; the complexity or difficulty of the subject-matter involved; the skill, expertise and specialised knowledge involved; the novelty of any questions raised; and the time and effort expended in the application or proceedings.

In Kiri Industries Ltd v Senda International Capital Ltd and another [2022] 3 SLR 174 (“Kiri”) at [66] it was said:

In short, ‘reasonable costs’ allows the court to look at all the facts and circumstances in a given case to determine the appropriate quantum of costs to be awarded. Skill, expertise and specialised knowledge coupled with the novelty of the issues raised are important considerations. It is, by design, a more generous and flexible regime, that may in appropriate circumstances mirror the approach to costs in international arbitration: see CPIT at [15]; Quoine at [22]; the SICC Committee’s Report. The broad nature of this inquiry was observed by the court in CBX at [9]: Thus, the question of amount of costs that a successful party should recover is at large and the judge is tasked to determine what is ‘reasonable’, a determination which can be guided by many factors moving far beyond the type of proceeding, the number of hearing hours and the kind of transcription service employed (though these factors will also be relevant, of course).

In Kiri, the court went on to explain the rationale and purpose of the SICC costs regime, to the conclusion (at [77]) of the commercial consideration of ensuring that a successful litigant is not generally out of pocket for prosecuting their claim (which must include defending a claim against them) in a sensible manner. So long as the costs are sensibly and reasonably incurred, a party in the SICC ought to be able to claim them.

Establishing reasonable costs

In Lao Holdings NV v The Government of the Lao People’s Democratic Republic [2022] SGHC(I) 6 (“Lao”) at [58], the court repeated (with reference to Kiri) that for proceedings in the SICC as long as the costs are reasonably incurred a successful party should be compensated for those costs, and said (at [83]):

The fundamental purpose of an award of costs in the SICC under O 110 of the ROC is to compensate the successful party for reasonable costs incurred in the legal proceedings. The phrase ‘reasonable costs’ is applicable to all costs, provided that they are reasonable. The qualification that the costs must be reasonable is only...