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Wasted costs order refused
In Koo Golden East Mongolia v Bank of Nova Scotia
An order for wasted costs could only be made where the solicitors had acted "improperly, unreasonably or negligently". The court held that this had not been established. The fact that a claim had been abandoned on appeal did not mean that it had been negligent to have pursued the claim at all. A solicitor's failure to appreciate that there was a binding authority which was fatal to his client's case, would not automatically justify a wasted costs order.
Further, the applicant must satisfy the court that it has suffered loss as a result of the solicitor's conduct. In this case, the claimant had not refused or failed to pay the costs. The appropriate course for the bank was to seek to recover costs from the claimant before taking action against its solicitors. An application for a wasted costs order should be a remedy of last resort.
An order for wasted costs could only be made where the solicitors had acted "improperly, unreasonably or negligently". The court held that this had not been established. The fact that a claim had been abandoned on appeal did not mean that it had been negligent to have pursued the claim at all. A solicitor's failure to appreciate that there was a binding authority which was fatal to his client's case, would not automatically justify a wasted costs order.
Further, the applicant must satisfy the court that it has suffered loss as a result of the solicitor's conduct. In this case, the claimant had not refused or failed to pay the costs. The appropriate course for the bank was to seek to recover costs from the claimant before taking action against its solicitors. An application for a wasted costs order should be a remedy of last resort.
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