The defendant costs specialists

Simmons v Castle – "simple, clear and fair"?

By on Oct 19, 2012 | 1 comment

I don’t want to have to change the name of the Legal Costs Blog to the Let’s Have a Go at APIL Blog but they do keep coming out with the silliest things.

APIL president Karl Tonks, commenting on the Court of Appeal’s change of mind in Simmons v Castle as to the timing of the 10% uplift in general damages, stated that the original ruling was “simple, clear, and fair to all concerned”.

His criticism is that:

“now someone who starts funding his claim in, for example, March next year but whose case concludes in, for example, November, won’t be entitled to the increase, while at the same time someone who starts on 1 April but whose case concludes in November will receive a different sum in damages for his pain and suffering. It could easily mean that two claimants leaving court on the same day, with the same injuries, will receive different damages just because of the date on which they signed their funding agreement.”

This appears to reveal a rather worrying lack of understanding as to how LASPO will operate.

Let us take two claimants who suffer identical injuries following highway tripping accidents, both worth £5,000 general damages in current money. They settle their claims in November 2013. Both claims are funded by way of CFAs with 100% success fees and ATE premiums of £500.

If the Simmons judgment had been left unaltered:

1. Claimant A starts his claim in March 2013. When the claim settles in November 2013 he would be entitled to damages of £5,500 (ie £5,000 plus the 10% uplift). The other side would be liable for the success fee and ATE premium meaning Claimant A walks away with £5,500 in hand.

2. Claimant B starts his claim in April 2013. When the claim settles in November 2013 he would be entitled to damages of £5,500 (i.e. £5,000 plus the 10% uplift). Claimant B will have to pay his success fee and ATE premium out of his damages. The success fee would almost certainly be £1,375 as the 25% cap would apply. Claimant B would therefore walk away with £3,625 in hand.

How is this any fairer then the amended judgment? The amended judgment means Claimant A get £5,000 and Claimant B £3,625. Still not the same, but at least closer.

Any change such as this creates inherent “unfairness” during the transitional period. If APIL had a fairer solution that would have meant all claimants would have identical outcomes with the introduction of LASPO it is a pity they did not suggest it to the Court of Appeal. Of course, one solution would have been to introduce the 10% uplift and the end to recoverability at exactly the same time (ie end recoverability retrospectively). That way Claimant A and Claimant B would both have identical outcomes when their claims settled in November. Although, no doubt APIL would have managed to come up with some objection to even that “fair” solution.

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