The Competition Appeal Tribunal (‘CAT’) was created by the Enterprise Act 2002.  A search of its website reveals 143 judgments concerning costs.  Unsurprisingly, the Merricks case (Merricks v Mastercard Incorporated) features more than once in that list.

In August 2023, the CAT dealt with the summary assessment of costs relating to four preliminary issues which had come before the tribunal earlier that year.

The ‘Limitation/Prescription’ issue was decided in favour of Mastercard after the Class Representative (‘CR’) decided not to pursue it. Despite accepting that he had lost the English law aspects of this issue, CR argued that costs should be reserved because they formed part of the costs of a ‘broader question of limitation’ and should be determined only when there was a final outcome on all aspects of the limitation issue.

The remaining three issues were decided in favour of CR.  The Defendant accepted the principle of paying CR’s costs of these issues but sought a deduction from CR’s costs in relation to one of the issues.  The Defendant argued that once the tribunal had made a decision in relation to s11(2) of the Prescription and Limitation (Scotland) Act 1973, the Claimant did not pursue his alternative but separate argument in relation to s6(4) of the same Act.  However, these costs were still included in the costs claimed against the Defendant.  

The Defendant’s deduction argument was dealt with in swift fashion.  The Tribunal found that CR’s case was based on s11(2) and in the alternative s6(4):

‘…[W]e do not think it would be fair to deprive CR of the costs of his preparatory work on s6(4) (which will obviously be much less than as regards s11(2)) when it is by reason of his success that this distinct argument is not going further.’


The application to postpone assessment of the Defendant’s costs was dealt with in a similar way – it was a discrete issue which had been fully argued before being determined in the Defendant’s favour.  In support, the Tribunal noted that CR had applied for permission to appeal against this determination.  The CAT concluded that there was no good reason to postpone the assessment of these costs (save for those costs that remained outstanding in relation to other aspects of limitation).

Having resolved these points of principle, the Tribunal turned to the ‘enormous size’ of the costs claimed and rolled up its sleeves to summarily assess them.

In relation to the hourly rates claimed, the solicitors on each side were not far apart:

                          Defendant                           Class Representative

Firm                  Freshfields                           Wilkie Farr & Gallagher

Grade A            £875.00/ £960.00               £730 /£825

Grade B            £478.00/ £525.00                £450.00

Grade C            £478.00/ £525.00                £450.00              

CR highlighted the complexity of the proceedings and the Defendant asserted that the rates claimed were consistent with market rates for specialised competition work within high value litigation.

TheTribunal’s response was:

·        It was only concerned with recoverable costs      

·        It recognised that parties can, and do, agree to pay much higher rates

·        The guideline hourly rates are just a guide

·        The guide to the Summary Assessment of Costs recognises that ‘substantial and complex litigation’ may justify rates in excess of the guideline rates

·        The guideline rates introduced in 2021 were more than a year old at the time of the judgment (editorial note: and were increased in January 2024)

The arguments put by both parties did not ‘begin to justify’ the hourly rates claimed.

Against Freshfield’s rates (70% over guideline) and Wilkie Farr & Gallagher’s rates (more than 60% over guideline), the tribunal allowed 30% over guideline – £665.60 for Grade A and £351.00 for Grade C.

So far as time spent was concerned, further criticisms were levelled at both sides by the Tribunal:

·        The attendance of more than one partner at hearings

·        The level of English counsel’s fees incurred in relation to matters of Scots law

·        The level of counsel’s fees generally

·        The time spent on costs submissions

The Defendant’s costs of almost £110,000 were reduced to around £82,000 (a reduction of 25%) which the tribunal declared to be a ‘still generous figure ’for the costs in issue.

Across the three remaining issues, CR had claimed total costs of almost £470,000.  These were reduced to around £369,000 (are duction of 21%).  According to the Tribunal this was ‘still a remarkably high figure for a hearing of under three days with no evidence…’ and much more than the £280,000 which the Defendant argued should be allowed.

One further costs decision was made in relation to an issue about ‘Solo cards’.  This issue was pleaded in the claim form (and valued at more than £500m), was defended and subsequently abandoned by CR but not until after disclosure.  The Defendant’s schedule of costs for dealing with this issue totalled more than £250,000 and it sought a summary assessment. The CAT declined to summarily assess these costs because it had not heard any argument on the issue to which the costs related and it ordered that the Defendant’s costs should be assessed if not agreed, although it was prepared to order a payment on account of £75,000.

Finally, the tribunal also ordered that the amounts payable by each side should be setoff.



The interesting point about this summary assessment for me is the preparedness of the Tribunal to assess hourly rates at lower levels than it would appear had been conceded by the respective paying parties. I am not sure a costs judge would have felt able to make such a ruling in what is an adversarial process – more commonly I would expect a costs judge to make a remark along the lines ‘I will not interfere with the hourly rates to the extent they have been conceded, but would remark that they are higher than I would ordinarily allow in a contested detailed assessment’.

I also note, despite the routine expression of surprise at the high level of costs claimed, the net result was unremarkable in any forum of standard basis assessment, with reductions of between 20 and 25% to the overall costs.

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