Interim ruling blow for Rebecca Vardy in Wagatha Christie case

An interim ruling yesterday (4 October) on the legal costs in the Wagatha Christie case resulted in further bad news for Rebecca Vardy, as it likely she will have to pay Coleen Rooney more in costs than may have been initially anticipated.

Jack Ridgway, chair of the Association of Costs Lawyers, commented: “As the clear winner of the case, it is no surprise to see that Mrs Rooney has been awarded most of her legal costs, with only a small reduction for those relatively minor elements where Mrs Vardy succeeded. The judge’s order that Mrs Vardy pay around half of Mrs Rooney’s estimated costs now is also pretty standard – indeed, it is on the low side”.

Ridgway explained the case will now move to the ‘detailed assessment’ – a process overseen by a specialist costs judge who goes into the detail of the costs Mrs Rooney is claiming. “This can take a months or even years” (sic), said Ridgway. He said it depends “just how much Mrs Vardy contests all the different elements in Mrs Rooney’s bill. There will, presumably, be attempt to reach an out-of-court settlement to shortcut this”.

“Normally, Mrs Vardy would only have to pay costs that were ‘reasonably and proportionately’ incurred by Mrs Rooney in defending herself. The standard approach is that, if there is any doubt about whether an item in the bill is reasonable and proportionate, it is resolved in favour of the paying party,” added Ridgway.

“The bad news for Mrs Vardy, however, is that the judge ordered her to pay Mrs Rooney her costs on the ‘indemnity’ basis. This is relatively rare, as it is only ordered where the court wants to mark its disapproval of the party’s conduct – in this case, that she and her agent had deliberately deleted or destroyed evidence.

“The effect is to make it harder for Mrs Vardy to challenge Mrs Rooney’s costs. Any doubt over whether they are reasonable will now be resolved in Mrs Rooney’s favour, not Mrs Vardy’s, while the added cross-check of the costs having to be proportionate – such as to the issues as stake – falls away. As a result, Mrs Vardy will very likely end up paying significantly more of Mrs Rooney’s costs than she otherwise would have. This might also make it harder for them to reach a settlement”.

Ridgway said there had been “speculation” over Vardy’s legal costs. He said: “It is likely that her lawyers acted under a ‘no win, no fee’ agreement, which is the usual model in libel cases, or at least a ‘no win, discounted fee’ agreement; given how expensive a case this was always likely to be, it would not have been attractive for her lawyers to take it on without a guarantee of being paid something. If there is an agreement in place, that at least reduces her exposure to her own lawyers”.

“She will also likely have taken out legal expenses insurance to cover the risk of losing and having to pay Mrs Rooney’s costs, again a standard feature of libel litigation. The premium for this would probably have been significant, given that her chances of winning were never clear-cut, but if so the insurer will pay Mrs Rooney’s costs, at least to the limit of the policy,” he concluded.