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	England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> BCT Software Solutions Ltd v C Brewer & Sons Ltd [2002] EWCA Civ 1765 (12 November 2002) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2002/1765.html Cite as: [2002] EWCA Civ 1765

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IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT
CHANCERY DIVISION
(HIS HONOUR JUDGE RICH QC)

		Royal Courts of Justice Strand London, WC2 Tuesday, 12th November 2002

Tuesday, 12th November 2002

1. LORD JUSTICE RIX: This is an application for permission to appeal against a costs order made by His Honour Judge Michael Rich QC, sitting as a Deputy Judge of the High Court. He made that order on 18th July 2002 following a compromise of the action in the course of trial. We have decided to give permission to appeal in this case, and I will merely say something to explain the grounds in issue.
2. The claimant and applicant on this application, now the appellant, is a software house. Its claim concerned an attempt to enforce its copyright in software licensed to the defendant, Brewer & Sons Ltd. The action was originally commenced on 7th June 2001. In its original claim there were wide-ranging allegations and claims, including the claim for an injunction. However, about a year after the commencement of that action, on 19th June 2002, the claimant was permitted to make extensive amendments which had the effect of considerably narrowing the issues in dispute. As a result of those amendments the claimant was made to pay the defendant's costs up to that date and, to the extent that some elements of those costs lay outside the original order made at the time of the amendment, those costs were dealt with by Judge Rich in his costs judgment on the basis that they should be paid 85% by the claimant. There is no attempt to appeal from that part of the judge's order.
3. Following the amendment the claimant was left with four specific claims based upon the infringement of copyright. As a result of the compromise, the claimant succeeded on one of those four issues only -- that is issue two -- but failed, as is accepted, on the other three issues.
4. In his clear and helpful submissions this morning, Mr Peter Susman QC, who appears on behalf of the claimant, submits that the issues upon which the claimant lost raised three specific questions of construction -- one on the construction of a quotation, the other two on the construction of the original licence -- but did not raise issues of fact. The first of those three issues in monetary terms was quantified at about £10,000: the other two issues only concerned one or two individual machines and were only worth some £800 or £400 each. However, the issue on which the claimant succeeded on the compromise -- the second of the four issues -- Mr Susman tells us involved numerous issues of fact apart from the claim to copyright because it was alleged that the defendant, Brewer, had made unauthorised use of the software in respect of 35 instances or machines. The claim in that respect was worth £400 per user and was therefore a claim for £14,000 in all. However, the issues of fact raised by that claim, as Mr Susman explains, ranged over the 35 disputed users.
5. What the judge did in assessing the costs was to assume that each of the four issues generated 25% of the costs. He said that there might be some anomalies involved in that broad brush assessment but they would cancel one another out. Mr Susman has submitted that the anomalies do not cancel one another out where the one issue upon which the claimant succeeded is the issue which involved disputes of fact, whereas the other three issues involved only disputes of law. It seems to me that that is an arguable point with a real prospect of success which should entitle the claimant to permission to appeal.
6. The other ground of appeal arises from the fact that, having assessed each issue at 25%, the judge then halved the recovery of 25% in respect of the issue upon which the claimant won. He awarded the other half in respect of that issue, i.e. 12.5%, in favour of the defendant. He said that he halved the 25% recovery on the issue on which the claimant won on the ground of what he described as "the smallness of the recovery as compared with the extent of the action" (see the transcript at page nine, lines 15 and 16). It is not clear what the judge was referring to in that statement. If he was referring back to the original shape of the action, he may well have been correct. But, of course, in that respect the claimant had already paid the penalty in costs of bringing an action which had been substantially amended and curtailed at the point of amendment in June 2002. If he was referring to the quantum of recovery on the successful issue, he would appear to be in error on the figures which I have stated earlier in this judgment. It seems to me that this also raises a point on which the claimant has a reasonable prospect of success on appeal, and he should therefore have permission to appeal.
7. It may also be said in general that, irrespective of the assessments in relation to the four issues issue by issue, overall the claimant brought his claim to protect his copyright and that copyright remained in dispute, as Mr Susman has informed us, until only a week before trial. One consequence of the ultimate acceptance of the claimant's copyright which arose as a result of the compromise agreement was that, in the course of that compromise agreement, the parties availed themselves of the opportunity to quantify the price which Brewer should pay for some new contemplated use of the software which was imminently contemplated albeit it had not been the subject matter of any claim in the existing proceedings. That agreement, reflected in the parties' compromise, is also reflected in the schedule to the judge's order in paragraph 2, which refers to a payment that Brewer was to make within 14 days to the claimant of £30,000 plus VAT. It is arguable that, although that was not part of the proceedings, it was a benefit which the claimant was able to achieve by the vindication of his copyright in the proceedings which he brought. It may be that this point should be the subject of an amended ground of appeal, for which we would also give permission, if the claimant wishes to pursue it.
8. For all these reasons, it seems to me that there should be permission to appeal.
9. LORD JUSTICE CARNWATH: I agree.
Order: Application allowed. Extension of time granted. Costs of this application to be treated as costs in the appeal.