Claims firm Pogust Goodhead is seeking a £189 million costs order ahead of the second stage of the mammoth London litigation over a dam collapse in Brazil.
In a day-long hearing before Mrs Justice O’Farrell, the court heard an application for an order for costs, brought by the claimants, represented by Pogust Goodhead, and permission to appeal, brought by the defendant, mining giant BHP.
For the claimants, Alain Choo-Choy KC, said that the stage 1 judgment, handed down in November, found BHP was strictly liable as ‘polluters’ in respect of damage caused by the 2015 Fundão Dam collapse. He said: ‘Although the claimants have not needed to bear the costs upfront, they have been incurred and the defendants are required to pay. The scale of funding has obviously been, and continues to be, huge and no funder has unlimited resources or otherwise.’
He told the court, the claimants ‘have had to secure very costly funding…in order to establish liability against an extremely wealthy opponent that has fought tooth and nail’ over the arguments taken against it adding that the ‘claimants are highly likely to recover substantial damages’.
The claimants’ estimate of their stage 1 costs is ‘at least £189,124,636.42, in respect of which they seek a 60% payment on account, in the sum of [around] £113.5 million’.
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Choo-Choy said the sum was justified ‘Although one can look at this number and say “wow that is ridiculous” when we look at it in the context of what we were required to do on the pain of being struck out basically [there is] justification. It is appropriate to use the £189m figure as the starting point for an assessment of an interim payment.’
For BHP, Nicholas Sloboda KC, said: ‘Any interim payment needs to be reasonable and proportionate. So far as I am aware this is the largest claim for costs ever in actually seeking recovery. It is bigger than most claims that go through these courts. [The claimants] are asking for £130m as an interim payment [and] there is a real absence of detail, an inexplicable absence of detail.'
In written submissions BHP said: ‘The appropriate order is to defer deciding the appropriate costs order (including the question of whether a percentage reduction is appropriate) until at least after stage two, where the question of overall success will be much clearer.’
It added that there would be no prejudice in its suggestion to defer costs, adding in written submissions that the claimants ‘have themselves not incurred any costs and their lawyers, [Pogust Goodhead], have wealthy funders who have been, to date, willing to provide vast sums to PG to pursue this litigation without regard to proportionality (apparent from the costs schedule now advanced), no doubt with a view to substantial commercial reward’.
BHP also sought permission to appeal, arguing that the liability udgment ‘fails to address numerous material issues even though they were clearly identified and fully addressed in BHP’s submissions’.
Judgment on both costs and permission to appeal was reserved.
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