My Lords, perhaps I might read out from Rule 44.2 of the CPR. It says that
“the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party; but … the court may make a different order”.
There is then considerable further guidance on the assessment of costs in the remainder of Rule 44. I can say, as a non-lawyer, that I think that is pretty clear. I note the point that the noble Lord, Lord Wolfson, made about having some sympathy with the language used, but the language which I just quoted is quite straightforward.
My noble friend Lord Hacking said that he was imploring me and he called the noble and learned Lord, Lord Hoffman, his nemesis. I might be my noble friend’s nemesis as well, because I will be arguing to reject his amendment. Of course, I thank him for tabling it. It is right that it is common practice that arbitrators already have great discretion on this matter under Section 61 of the 1996 Act. The Law Commission has made no recommendations for reform of Section 61, so we believe there is no reason for having a reform that may introduce some level of uncertainty, which we do not believe is necessary.
The previous arbitration Acts of 1889 and 1950 simply provided that costs were at the discretion of the arbitrators but the 1996 Act then provided the current default rule, which mirrored the position in the rules of the Supreme Court, which were the court rules then in force. Although the language has changed with the CPR now in force, the underlying principle is still the same. The CPR, and the RSC before them, take the view that costs should follow the event as a fair default rule. Section 61 allows arbitrators to depart from that rule as appropriate. In substance, therefore, Section 61 already allows the arbitration tribunal to award whatever costs it thinks fair.
The Law Commission received no representations from stakeholders that Section 61 was causing any difficulties in practice, and it is unusual to change the language of an Act if there is no change in principle. Indeed, it is possible that the amendment could be interpreted as a new, untested principle. In the light of this, I am grateful for the opportunity to clarify the current arrangements and would suggest that no amendment is needed. I therefore invite my noble friend to withdraw his amendment.