The defendant costs specialists

Fixed costs confusion

By on Nov 17, 2016 | 1 comment

There have been two decisions in quick succession from the Court of Appeal in relation to the operation of the various fixed fee regimes.

Bird v Acorn Group Ltd [2016] EWCA Civ 1096 was a public liability claim that was withdrawn from the portal due to the defendant’s failure to respond.  Liability was admitted by the Defendant shortly thereafter.  In the absence of settlement, proceedings were issued.  The Defendant failed to file an Acknowledge of Service and the Claimant obtained default judgment, with the claim then being listed for a disposal hearing but settling in advance.

The Court of Appeal ruled that listing a portal ‘drop out’ case for a disposal hearing is listing for trial, meaning that it attracts column 3 fixed costs if it then settles.

Briggs LJ held:

“In every case where a claimant obtains judgment for damages to be assessed, followed by a disposal hearing for that assessment, there will be a progression from column 1 (which comes into force when proceedings are issued) to column 3, when the disposal hearing is listed.

The fact that column 2 is jumped over because there is 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. But that by no means undermines the good sense of a conclusion that, once there has been a listing for a disposal hearing, column 3 is triggered.”

In Qader & Others v Esure Services Ltd [2016] EWCA Civ 1109 the Court of Appeal held that the Fixed Recoverable Costs Regime does not apply to a claim started in the RTA Portal, which subsequently exited the portal and was allocated to the multi-track after proceedings were issued under Part 7 of the Civil Procedure Rules.

The Court concluded there was a drafting error in the rules and the best way to give effect to the intention was to add, to Part 45.39B, after the references to 45.29J:

“… and for so long as the claim is not allocated to the multi track”

Kerry Underwood comments on this decision:

“The result may be just, but the Court of Appeal accepted that to achieve that result it needed to add in words to the Civil Procedure Rules, even though there was no irrationality in the wording and no irrationality or inherent unfairness in giving effect to that clear wording.

The lead, and only judgment, was given by Lord Justice Briggs, author of the extremely controversial report proposing to abolish court hearings for most claims under £25,000. Here, as a judge, he re-writes the law passed by Parliament, to reflect what he thinks was the minister’s and the Government’s – not Parliament’s mind – intention. … The decision is a constitutional outrage…”

Ignoring the issue of the route by which these decisions have been reached, we are now several years into various fixed costs regimes that were intended to simplify matters.  Instead we are still seeing matters being fought out in the Court of Appeal as to what the rules actually mean and with the judiciary, on occasion, having to expressly re-write what they clearly say.

And the senior judiciary calls for a further extension of fixed costs.  You couldn’t make it up.

    1 Comment

  1. Don’t forget Singh v Ajaz, Bristol County Court, 27 September 2016, unreported (thanks to Peter Bland via the ACL forum).

    “At the first appeal HHJ Denyer QC held that the Fixed Recoverable Costs Regime under the above mentioned rule applied to the costs of a claim begun in the RTA Portal and which was subsequently allocated to the small claims track.

    It was a claim where the matter exited the MOJ Portal due to no liability decision by the TPI. The parties then managed to agree PI at £1500 and proceedings were then issued for the hire claim alone. The claim was allocated to the small claims track.

    HHJ Denyer ruled that fixed costs under CPR 45.29A applied, rather than small claims track costs” (there was apparently no further appeal).

    Also see Kerry Underwood’s ‘take’ on all this at https://kerryunderwood.wordpress.com/2016/07/27/what-fixed-costs-are-payable-when-different-parts-settle-at-different-stages/#comments

    Sue Nash

    17th November 2016

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