Costs, Conduct & Counter-Offers – Key Takeaways from the Bankside rights of light costs decision

In March 2026, the High Court handed down its costs judgment in Mr Cooper & others v Ludgate House Limited (2025), a case that offers valuable lessons for developers managing similar rights to light disputes. At the substantive trial, the Judge exercised his discretion not to grant an injunction restraining the infringement of the claimants’ rights to light, instead awarding damages in lieu of £350,000 to Mr Cooper and £500,000 to Mr and Mrs Powell. The parties then returned to court to resolve the question of costs.

The Court’s Decision

The central question was who should be treated as the “successful party” for costs purposes. It was argued that, because no injunction had been granted, the party defending the claim should be regarded as successful and awarded its costs. The Judge took a different view: because liability was contested throughout the trial, the claimants were the successful party overall, even though they were only partially successful in respect of their claims. Recognising that the issue on which they did not succeed was a significant one, the Judge awarded them only a proportion of their costs.

The Judge also considered two settlement offers made by the developer in November 2024, each for £500,000 to the claimants. These were made as Part 36 offers, a formal offer mechanism under the Civil Procedure Rules that carries costs consequences if not beaten at trial. However, the offers were not limited to the claims at issue: they also sought to extinguish rights of light over adjoining land owned by an associated company, and to resolve related claims over the wider development site, which was subject to the local authority’s exercise of its statutory powers (under section 203 of the Housing and Planning Act 2016). While the Judge confirmed that these were valid Part 36 offers, it was not established that the offer had been beaten by the trial outcome for Mr Cooper.

For Mr and Mrs Powell, the position was more straightforward: their combined award, including interest, exceeded £500,000, meaning they had beaten the offer. They recovered two-thirds of their costs, reflecting their success in beating the offer, balanced against the fact that they had not succeeded on every element of their claim.

The position was different for Mr Cooper, who was awarded £350,000 at trial. During the litigation, Mr Cooper made a counter-offer of £7 million. The Judge considered this to reflect an unrealistic negotiating position, noting that, by continuing to litigate after receiving the November 2024 offer, Mr Cooper stood to gain little of practical value beyond what had already been offered, and that his focus from that point was on securing a substantially larger sum. As a result, he was awarded only one third of his costs.

What Can Developers Learn From the Bankside Costs Decision?

Make settlement offers early and consider carefully where to pitch them

In this case, the initial pre-action offers were based on book value assessments made before proceedings were issued – £23,000 to Mr Cooper and £36,000 to the Powells – figures which were, understandably, far removed from the sums eventually awarded at trial. The offers were increased once proceedings were issued, rising to £350,000 and then £500,000 each. This progression illustrates a wider principle: offers grounded in book value, rather than a realistic assessment of likely damages (including any premium a court may award to reflect the loss of an injunction), are unlikely to provide meaningful costs protection if the matter proceeds to trial. Developers can reduce this risk by obtaining early advice – ideally before or shortly after proceedings are issued – so that settlement offers reflect the true litigation risk from the outset to maximise their costs protection.

Successfully resisting an injunction does not automatically mean “winning” on costs

The developer in this case succeeded in persuading the Judge not to grant an injunction, a “success” of sorts. However, the Judge did not accept that this, alone, made the developer the successful party for costs purposes. Because liability remained in dispute throughout the trial and most of the costs incurred related to that dispute – the claimants were treated as the overall successful party by the court. 

The timing of certain admissions during the proceedings was also an important factor. The existence of the rights of light was only accepted in proceedings quite late on in Bankside. The broader lesson for developers is that focusing solely on defeating an injunction may not be enough to secure a favourable costs outcome; addressing points of principle at an early stage, where they are unlikely to succeed, can help control the overall costs of litigation – regardless of the ultimate outcome on remedy.

Structure Part 36 offers clearly, and break down composite figures

The developer’s Part 36 offers were found to be valid in this case, an important procedural win. However, because the offers bundled together the claims with the extinguishment of rights of light over adjoining land and the resolution of other claims relating to the wider development site, it could not be shown that the offer had been beaten at trial by  Mr Cooper. This highlights a practical drafting point: where a settlement offer covers more than one issue or piece of land, consideration needs to be given to whether the offer can be made as a Part 36 offer to preserve the costs protection that the provision is designed to provide.

Anticipate how the other side’s negotiating position may be viewed by the court

During the litigation, Mr Cooper responded to the developer’s offer with a substantially higher counter-offer of £7 million. The Judge found that this reflected a negotiating position that went beyond a genuine attempt to settle, and reduced Mr Cooper’s costs recovery to one third accordingly. For developers, this is a useful reminder that a well-evidenced, clearly reasoned offer – one that leaves a clear paper trail of what is being offered and why – puts the court in a strong position to assess the reasonableness of the other side’s response at the costs stage, even where the offer itself is not ultimately beaten.

Practical Steps for Developers

• Make settlement offers as early and as realistically possible, and review and revise them as the evidential picture develops.
• Use Part 36 offers strategically, but keep the figures for separate claims or issues distinct and clearly broken down.
• Keep a clear, well-documented record of the reasoning behind offers and counter-offers, to support any later costs argument.
• Review settlement strategy and stock stake at key milestones in the litigation, such as after disclosure or the exchange of expert evidence, to ensure offers remain realistic in light of how the case develops.

Conclusion

The Bankside decision shows that success on a specific point, such as resisting an injunction, does not necessarily translate into a favourable costs position, and that the way a claim is defended and negotiated throughout its life can matter just as much as the ultimate result.

For developers managing rights of light and other property disputes, the practical takeaway is to invest early in professional advice, structure settlement offers clearly and transparently, and resolve difficult points sooner rather than later. Adopting this approach will not guarantee a particular outcome at trial, but it will help ensure the strongest possible costs protection should it not prove possible to avoid trial altogether.

To explore the practical implications of the Bankside decision in more detail, listen to our Light Bites series, where industry experts discuss key developments in rights of light and what they mean for developers, landowners and advisers.