Eversheds awarded full costs for Newcastle International Airport claims

Newcastle International Airport (NIA) has been ordered to pay all the costs associated with the negligence claim it brought against Eversheds, which ended last week after a six-year battle.

NIA is thought to have incurred costs in the region of £2.5m after launching the largely unsuccessful claim, worth an estimated £5m, against Eversheds. Last week the Court of Appeal ordered the firm to pay nominal damages of £2 for a technical breach last week (29 November 2013).

Following written submissions after the decision last week, NIA was ordered to pay the costs of the case.

The Court of Appeal (CoA) ruled that Eversheds should have consulted the airport’s remuneration committee, chaired by Rosemary Radcliffe, on the impact of two NIA directors’ bonus deals.

It was alleged that the firm had allowed the directors to pocket bonuses after following instructions given by them to advise on a £377m refinancing deal with RBS.

The airport argued that Eversheds was aware that the two directors held interests distinct from the airport and that those interests conflicted with it because they were aiming to get the best possible terms in new employment contracts.

The claim was defeated in the High Court last year, when Mrs Justice Proudman ruled that “Eversheds acted in good faith on the basis of the instructions which it was entitled to accept” (2 October 2012).

NIA was granted permission to appeal the ruling on the basis of public interest, but the court also said the airport must be prepared to be held liable for Eversheds’ costs (29 October 2012).

Eversheds turned to Clyde & Co professional indemnity chief Sarah Clover to defend the case. She instructed 4 New Square’s Ben Patten QC.

Ward Hadaway partner Tim Toomey instructed 4 New Square’s Nicholas Davidson QC for NIA.

In a statement, Toomey said of the decision: ”We are disappointed at the outcome and surprised that the appeal judges upheld the first instance decision that, had a short summary of the executive contracts been provided to NIAL, then this would not have been acted upon by the highly experienced and regarded non-executive chairman.”