Challenge to costs award

The Law Lords are to consider the case of two insurance companies which, after agreeing to pay out £1m on a claim against them in respect of a factory fire, were then also ordered to pay a further £250,000 costs. The claim was mounted on the basis of third-party liability provisions in a home contents policy on the home of a man said to have started the fire by discarding a match into a drum of flammable furniture polish. Costs were awarded by the High Court in June 1996, a decision affirmed by Appeal Court in July 1997.