In the context you've described, specifically when the user clicks "load more" and the initial 5 items have already loaded, it's crucial to address the server error appropriately. Typically, server errors prevent the display of regular content, resulting in a blank screen accompanied by the server-generated error message.
Distinctions exist between errors originating from the application code base and those stemming from server issues. The behaviours of these two types of errors differ significantly.
If the "load more" action triggers a server error, my recommendation is to implement the following approach: "Display an empty state with an error message instead of presenting the entire list." On the other hand, if the error is not associated with the server but rather with the application itself, you should consider this alternative: "Maintain the display of the initial 5 items and showcase an error state below them."
I think this approach provides the users with clear and relevant feedback, ensuring a more user-friendly experience in response to different error scenarios.