Decision

Decision on Lidl Logistics Limited

Updated 6 March 2024

Companies Act 2006

In the matter of application No. 3649 by Lidl Stiftung & Co. KG for a change to the company name of Lidl Logistics Limited, a company incorporated under number 05306500

Supplementary decision on costs

1. On 11 November 2022, the decision on the substantive grounds (O/985/22) was issued. Earlier interim decision O/031/22 regarding an unsuccessful strike out action brought by the primary respondent and supplementary decision O/143/22 correcting an error in that interim decision were attached. We found in favour of the applicant, and this was confirmed by the court following the respondents’ appeal to both the decision on strike out and the substantive decision. The court awarded costs in respect of the appeal.

2. There has been an unfortunate delay in considering the issue of costs in the first instance decisions and we are grateful to the applicant’s representative, Murgitroyd & Company Ltd, for pointing this out in its email of 26 February 2024. We consider the issue of costs now. In the substantive decision we stated:
   
   37. The interim decision provided an opportunity for the parties to file written submissions on costs. The period provided was subsequently extended and on 3 March 2022, the primary respondent provided its submissions. On the same date, the applicant wrote, stating its view that it would be prudent for costs to be dealt with at the final determination of the proceedings. In its letter to the parties of 9 March 2022, the tribunal confirmed that it agreed with the applicant and stated:
   
   … At [the end of the proceedings] the adjudicators will take account of the submissions already filed and, following any directions, further submissions that may be made in writing or at a hearing.
   
   38. As the applicant has yet to provide its written submissions on costs, it is directed to do so now. These submissions should be received within 21 days of the date of this decision. The respondents are also permitted the same period to file any further written submissions to those it filed on 3 March 2020 [this should have been a reference to “3 March 2022”]. We will consider all submissions before issuing a supplementary decision on costs.

3. The applicant subsequently filed written submissions. We take account of both parties’ written submissions (including the respondent’s submissions filed following the interim decision) when giving this decision.

4. The applicant submits that it is entitled to off-scale costs in respect of what it characterises as a “hopeless strike out action” and scale costs in respect of its successful application.

5. Whilst the respondents were unsuccessful in respect of the strike out action, we do not consider that it was a “hopeless” action, having little legal precedent on the issue. Consequently, we do not consider that off-scale costs are appropriate. Nevertheless, the respondents’ submissions were forcefully pursued at a hearing and required the applicant to consider and respond to these submissions. On this basis we consider that it is appropriate to award a contribution towards the applicant’s costs as follows; £400 for considering the strike out request and £750 for preparing and attending the hearing.  

6. In respect of the substantive proceedings, we note the applicant’s request for scale costs and that a hearing was not requested by either party. The respondents’ submissions were based upon the applicant’s case being (i) misconceived, (ii) that the respondents had a complete defence to section 69((1)(a) and (b) and (iii) the claim that the applicant refused mediation which amounted to a “serious and flagrant failure to engage with ADR”, all of which should lead to full off-scale costs in favour of the respondents.

7. In respect of points (i) and (ii) of the respondents’ submissions, in light of the outcome of both the interim decision and the substantive decision it is clear that we found that the applicant’s case was not misconceived nor did the respondents have a successful defence. Therefore, we dismiss these two limbs of the respondents’ submissions.

8. In respect of the claimed failure of the applicant to engage in mediation, the applicant submits that it gave the respondents ample opportunity to change the contested company name before filing its application. It acknowledged that the respondents requested ADR but did not provide any details as to the basis for settlement discussions. Nevertheless, it did agree to ADR in May 2021 but received a response whereby the respondents required the applicant to pay historic legal costs incurred to date before taking up the offer. The applicant explains that this and the absence of a satisfactory reason why the respondents remained reluctant to change the name of the primary respondent resulted in it, in October 2021, losing patience with the primary respondent and deciding to commence proceedings before the tribunal. A further suggestion of ADR was made on behalf of the respondents in December 2021, which the applicant rejected, but it did invite the respondents to make a written offer of settlement. No offer of any kind was received.

9. Taking these circumstances into account, we do note that the applicant did agree to ADR prior to commencing the proceedings but was deterred by the primary respondent’s request for the applicant to pay historic costs before commencing ADR, something that the applicant considered to be unreasonable. We consider that the applicant should not be penalised in costs for declining ADR in such circumstances. Therefore, we dismiss this limb of the respondents’ request for costs. The applicant is, therefore, entitled to scale costs in respect of the substantive decision.  

10. The Tribunal awards costs from the published scale at paragraph 10 of the Tribunal’s Practice Direction.  This is intended to provide a contribution to costs, but not to recompense the successful party. We keep in mind that the applicant was professionally represented. The award breakdown is as follows:

Considering and responding to strike-out action: £400
Preparing for, and attending interim hearing: £750
Preparing the Form CNA1 and considering the Form CNA2: £400
Official fees (Form CNA1/Form CNA3 x 2): £700
Preparing evidence and considering the other side’s evidence:          £750

Total : £3000

1. Lidl Logistics Limited and William James Hogger, being jointly and severally liable for the above costs, are ordered to pay Lidl Stiftung & Co. KG the sum of £3000.  This sum is to be paid within twenty-one days of the date of this decision.

2. Section 74(1) of the Act provides no rights of appeal in respect to costs.

Dated 5 March 2024

Mark Bryant
Company Names Adjudicator

Judi Pike
Company Names Adjudicator

Matthew Williams
Company Names Adjudicator