Costs News

17 November 2016
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Good news for claimants with twin PI protocol costs rulings

The Court of Appeal has issued two significant decisions about fixed costs and the RTA and EL/PL portals this week.

With Lord Justice Briggs giving both lead judgments, yesterday he ruled that cases which exit the RTA and EL/PL protocols and then proceed on the multi-track were not subject to fixed recoverable costs, and essentially rewrote the CPR to correct what he considered to be an oversight in the drafting of part 45.29B by the Civil Procedure Rule Committee.

On Monday, he held that a disposal hearing was a “trial” and so portal ‘drop-out’ cases attracted column 3 fixed costs if they then settled.

Qader & Ors v Esure Services Ltd & Ors [2016] EWCA Civ 1109 dealt with the multi-track issue.

Giving a unanimous ruling overturning Qader, Lord Justice Briggs said “the claimants in each case, and their solicitors, face the unattractive prospect of pursuing their claims and resisting serious allegations of dishonesty, at trials likely to last well over one day but upon the basis of a fixed costs regime which, as will appear, was plainly designed to be suitable only for fast-track cases”.

The problem was that part 45.29 appeared “unambiguously to apply the fixed costs regime to all cases which start within the relevant protocols but no longer continue under them”, the judge observed. This was exacerbated by the fact that the work on creating the regime focused on the fast-track.

Briggs LJ said: “After more hesitation than my Lords [Gross and Tomlinson LJJ], I have come to the conclusion that section III A of part 45 should be read as if the fixed costs regime which it prescribes for cases which start within the RTA protocol but then no longer continue under it is automatically disapplied in any case allocated to the multi-track, without the requirement for the claimant to have recourse to Part 45.29J, by demonstrating exceptional circumstances.”

He said a “careful analysis of the historic origins of the scheme” showed that it was a drafting error, meaning “the court’s interpretative powers must be used, as far as possible, to bring the language into accord with what it is confident was the underlying intention”.

Briggs LJ pointed to a Ministry of Justice response to consultation in February 2013 that said: “It has always been the government’s intention that these proposals apply only to cases in the fast track and if a case falling out of the protocols is judicially determined to be suitable for multi-track, normal multi-track costs rules will apply.”

The best way to give effect to the intention would be to add to part 45.29B, after the reference to 45.29J, the words: “… and for so long as the claim is not allocated to the multi-track…”

Briggs LJ added: “I recognise the force of [counsel for Esure’s] submission that this process of interpretation by the addition of words risks giving rise to satellite litigation at the allocation stage by claimants seeking to disapply the fixed costs regime in relation to their claims.

“I consider that this is a risk best addressed by relying upon the good sense and vigour of case management judges in furthering the overriding objective, and in penalising those who seek to abuse the opportunity to which the allocation stage in such a claim gives rise.

“I recognise also that my proposed insertion of words to part 45.29B does nothing about the anomaly represented by the £25,000 apparent damages ceiling in part A of Table 6B. It is unnecessary in the context of these appeals to do so, both because neither of them reached settlement prior to the issuing of part 7 proceedings, and because the damages claimed are well below £25,000.

“It is a continuing anomaly which, in my view, the rule committee should be invited to consider at the earliest available opportunity. It may also be minded to devise an amendment to section IIIA of part 45 which fully reflects the concerns which underlie this judgment, not merely in relation to the RTA protocol, but to the EL/PL protocol as well.”

Meanwhile, in Bird v Acorn Group Ltd [2016] EWCA Civ 1096, a public liability claim was withdrawn from the portal due to the defendant’s failure to respond. It was listed for a disposal hearing but then settled. The dispute was over which column within table 6D part B applied for the purpose of fixing the costs.

DJ Campbell decided that the listing of a case for a disposal hearing was a listing for trial and so column 3 applied. The defendant argued that it should be column 1.

Lord Justice Briggs agreed and said the claimants did not have to advance through the columns sequentially. “Listing a case for ‘disposal’ means exactly what it says,” he said. “The purpose of doing so is, so far as possible, finally to dispose of the case at first instance.”

With listing for a disposal hearing the trigger for the claimant to prepare and serve evidence, he noted the district judge’s comment that many disposal hearings settled shortly before trial.

Briggs LJ said: “It seems most unlikely that the rule committee can have intended to leave the claimant to the much lower column 1 level of recovery after such a settlement, having done all of the work necessary to achieve finality at the disposal hearing, and being entitled to fixed costs equivalent to column 3, plus the trial advocacy fee, if the matter proceeded all the way to a disposal hearing.”

The fact that column 2 was jumped over because there was no intermediate allocation to the fast-track “seems to me to be just one of those events which means that the three columns will not always be triggered in succession”.

 

This post was posted in ACL e-Bulletin

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