In Vitol SA v Genser Energy Ghana Ltd [2022] EWHC 1955 (Comm) Ms Lesley Anderson QC (sitting as a Deputy High Court Judge) considered whether interest should be payable on costs from a date before judgment. She held that interest on costs should run from the date of the invoice at a rate of 1% above base rate.

“In my judgment, this is an appropriate case to award interest on costs to Vitol. These are substantial commercial proceedings and it is right that Vitol should be compensated for being out of its money.”


The judge had earlier given judgment in this commercial action for USD 3,295,019.26  and ( USD 2,631,064.70. The question arose as to whether interest should be paid on those costs from a date prior to judgment.


    1. Two issues arise here: (a) whether I should order Genser to pay interest on Vitol’s costs and (b) if so, at what rate and for what period.
    1. The starting point is CPR 1998 rule 44.2(6)(g) which provides that the Court has the power to order the payment of interest on costs from a date prior to judgment. I have been reminded (by reference to the decisions in Sharp and others v Blank and others [2020] Costs LR 835 and [22] and he decision of Leggatt J (as he then was) in Involnert Management Inc v Aprilgrange Limited and others [2015] 2 CKC 405 at [7]) that the essential purpose of such an order it to compensate the party who has lost the benefit of monies which it has had to pay to its solicitors or has had to borrow it and that such orders are commonly made in the courts, especially I would add in the Commercial Court. On behalf of Genser, it was submitted that thi is a relatively novel jurisdiction and that the task is to assess what is reasonable for both parties, especially having regard to the class of litigant to which they belong (see SOS for the Department of Energy and Climate Change v Jeffrey Jones and others [2014] EWCA Civ 363 at [17]).
    1. Here, the claim was commenced in February 2020, almost two and a half years ago. The parties are commercial parties. Vitol is one of the largest oil traders in the world and Genser is a significant player in the energy market. Vitol has incurred significant costs in pursuing the claim which has been defended vigorously by Genser throughout. As I I noted in my main Judgment, Genser’s case has undergone several changes of direction all of which has added to the costs.
    1. Although Genser submits that I should not make an order in the absence of evidence to establish precisely what costs were paid by Vitol and when, I am not satisfied that is the correct position when how and when the payments were made can be easily established and is unlikely to be in issue. In my judgment, this is an appropriate case to award interest on costs to Vitol. These are substantial commercial proceedings and it is right that Vitol should be compensated for being out of its money. I will order that interest is paid from the date of the relevant invoice until three months after the date of the Judgment (ie 30 September 2022) after which, if the costs have not been paid, interest will run at the judgment rate. This was the approach adopted in Involnert and Hyde v Nygate [2021] EWHC 1150 (Ch) and provides Genser with the opportunity to take a view on its liability.
  1. Turning to the appropriate rate, Vitol contends that the correct rate is at the Bank of England’s base rate + 2% which, it submits, is a small uplift on the actual rate for a large period of the litigation (0.1%). For Genser, I was referred to the observation in the Jeffrey Jones case at [17] and [18] to the observations there that the rate of interest may depend on the class of borrower. There is no doubt here that Vitol falls within the category of “first class borrower” and in my judgment the correct rate is that set by the short-term cost of unsecured borrowing for that type of borrower. For most of the period of the litigation, that has been 0.1%. In my judgment, it is proper to reflect some uplift on that figure but that the 2% above base is too high. I order that interest be payable on costs at the rate of 1% over the base rate for the time being of the Bank of England.