Twelve-year anomaly in Guernsey law overturned

Until the change parties were entitled to costs up to 700 per cent lower than they would have been if awards were in line with inflation.

The island's Court of Appeal, which maintained the anomaly for over a decade despite protests from lawyers, reformed the system after its decision in Stuart-Hutcheson v Spread Trustee Company.

In this case, under the Court of Appeal's old rules, the trust beneficiary would have been awarded just £1,100. But this was hiked to £7,600 after the anomaly was pointed out; the court then index-linked its costs, a step the island's Royal Court took in 2000.

The decision of the court in Stuart-Hutcheson came from the fact that the winning party, a trust beneficiary, acted properly in bringing the case to court, and should not be out of pocket, which he would have been if awarded costs at the 1991 level.

Ozannes acted for the beneficiary in the case.