Breen v Clough (No 2)

The case of Breen v Clough (No 2) involved the plaintiffs, Breen and another, pursuing the defendants, Clough and others, for damages and an account of profits arising from alleged breaches of fiduciary duty. The dispute reached the court after a trial where the plaintiffs achieved partial success but were unsuccessful on a significant aspect of their claim. The matter came before the court to determine the allocation of costs.

The primary legal issues for the court were whether the unsuccessful aspect of the claim was separable from the successful part, and if the plaintiffs had unreasonably rejected various Calderbank offers. Additionally, the court needed to decide whether the plaintiffs had obtained orders no less favourable than the defendants' Offer of Compromise. These issues were crucial in determining whether the plaintiffs should be penalised for their partial success and whether the court should depart from the usual rule that costs follow the event.

In addressing these issues, the court examined the nature of the claims and the outcomes at trial. The court concluded that the unsuccessful aspect of the claim was not separable from the successful one, implying that the plaintiffs could not be considered successful on the whole. Regarding the Calderbank offers, the court found that the plaintiffs had unreasonably rejected certain offers, leading to a penalty in costs. However, the court also considered whether the plaintiffs had obtained orders no less favourable than the Offer of Compromise, which ultimately influenced the final costs order.

The court ordered that the plaintiffs pay the defendants' costs of the appeal and the trial, subject to a 20% reduction due to the partial success. The court found that the plaintiffs' orders were no less favourable than the Offer of Compromise, which led to a further adjustment in the costs order. The outcome reflected the court's consideration of the principles of proportionality in cost awards and the importance of evaluating the totality of the proceedings in determining costs.