Relief from sanctions applications

Carrying on with my tidy up, I came across a copy of the judgment of His Honour Judge Hamilton in Connor v Birmingham City Council (16 March 2005).

This concerned a case where a claimant had given notice that a claim was being funded by way of CFA in pre-proceedings correspondence but no notice, as required by the rules, was provided when proceeding were issued. No application for relief from sanctions was made before the detailed assessment and this was only sought orally at the hearing. The District Judge, as first instance, refused relief and disallowed the success fee. His Honour Judge Hamilton dismissed the appeal with the following words:

“It seems to me these are rules to be followed and if a judge decides that they must be followed, no criticism can be made of him for so deciding.”

With hindsight, it seems amazing that there used to be judges with such unenlightened views. However, this was a decision made under the old strict approach to relief from sanctions.

When Lord Justice Jackson undertook his major review he concluded that expecting parties and their solicitors to follow rules and court orders was generating unnecessary extra work for them and this led to disproportionate costs being incurred. Solicitors should be allowed to do what they wanted, when they wanted. A new relief from sanctions rule was required that would encourage a culture of non-compliance.

This approach was warmly endorsed by the senior judiciary in the run-up to implementation of the Jackson reforms with a number of high profile talks being given explaining that nobody likes goody two-shoes solicitors who slavishly follow the rules and court orders and then snitch to the court if their opponent does not do likewise in a cynical attempt to gain a windfall for their client. In future, those asking the courts to enforce the rules could expect to be slapped with adverse costs orders.

The Court of Appeal duly followed this new approach to relief from sanctions in the entirely consistent decisions of Henry, Mitchell and Denton (despite some troublemakers suggesting there might be some mixed signals being given out).

I think I’ve fairly summarised how we’ve got to where we currently are, although I might have become a bit confused over some of the finer details.

Callery v Gray revisited

I’ve been having a bit of a tidy up and came across a copy of the original appeal judgment in Chester County Court in Callery v Gray.

The Callery v Gray litigation was ultimately viewed as a large success for claimants generally and Amelans solicitors in particular, the Claimant’s solicitors in that case. It was therefore interesting to reread the comments of His Honour Judge Edwards:

“In this particular case I note that the District Judge has slashed in half the basic costs figure, and I do not understand that that is being contested. I think, therefore, that in this particular case as to the basic costs figure the claimant’s solicitors must ask themselves whether what they were putting forward was in truth reasonable and proportionate for a case like this.”

Only in the crazy world of costs would this case be notched up as a success for the Claimant’s solicitors.

More Christmas drink recommendations

Christmas is obviously a time for sherry. And I’m not talking about the one bottle of Harveys Bristol Cream that your aunt brings out of the cupboard once a year, pours one glass from and replaces until the next year. (Sherry should be drunk within a few weeks of opening the bottle.)

No, proper sherry is one life’s great pleasures and apparently the “hipster’s tipple of choice” (not that this is any great recommendation on its own).

My top tip for sherry lovers is Sainsburys’ own brand stuff. This is consistently good quality across all types of sherry and just as good as more expensive brands such a Tio Pepe. I particularly recommend a chilled glass of their Pale Dry Fino or Dry Manzanilla. Or, a glass of Medium Dry Amontillado served at room temperature; just the thing to give a warm glow to the heart. All absolute steals at £5.50 a bottle.

Legal Costs Blog 2014 Award for Most Startling Legal Discovery

The Legal Costs Blog 2014 Award for Most Startling Legal Discovery goes to Mr Justice Barling in Long v Value Properties Ltd & Anor [2014] EWHC 2981 (Ch) when giving judgment on the interpretation of the old notification requirements concerning additional liabilities:

“The provisions as they currently stand are obscure, unnecessarily complex, and in need of rationalisation.”

More Christmas drink recommendations

My second drink recommendation in the run up to Christmas is Ayala Brut Majeur NV Champagne. You might not have heard of Ayala but it is now owned by the same people who make Bollinger champagne. Ayala is the “house” champagne at Middle Temple and served at their special events.

Normally priced at £28.99 from Waitrose/Ocado. However, you can pick this up as low as £20.99 a bottle when purchasing a case of 6 from drinksfactory.co.uk. Spend a little bit more to get free delivery (otherwise £5.99 in addition per delivery).

Bubbly.

Interim costs payments

The pre-Jackson CPR contained two provisions concerning the making of orders requiring interim payments prior to detailed assessment. CPR 44.3(8) read:

“Where the court has ordered a party to pay costs, it may order an amount to be paid on account before the costs are assessed.”

The second provision was contained CPR 47.15(1):

“The court may at any time after the receiving party has filed a request for a detailed assessment hearing –

(a) issue an interim costs certificate for such sum as it considers appropriate;

(b) amend or cancel an interim certificate.”

I had always read this to mean there were two stages at which such an order could be made:

1. At the same time an order for costs is being made (usually following a trial).

2. After a request has been filed for a detailed assessment hearing.

Therefore, if an order for a payment on account had not been made when the costs order was being made, the next opportunity to obtain an order for an interim payment would not arise until after a request for a detailed assessment hearing had been made. CPR 44.3(8) did not confer a general power on the court to order an interim payment at any stage. If it did, CPR 47.15(1) would have been redundant.

Interestingly, in the cases of Dyson Ltd v Hoover Ltd [2003] EWHC 624 (Pat) and Blackmore v Cummings & Ors [2009] EWCA Civ 1276 it appears this distinction in timing was not argued and the courts simply proceeded on the basis that CPR 44.3(8) could be used to obtain an interim payment at any stage after an order for costs had been made.

The current wording of the CPR is very similar to before, except there is now a presumption a payment on account will be ordered when costs are awarded. CPR 44.2(8) reads:

“Where the court orders a party to pay costs subject to detailed assessment, it will order that party to pay a reasonable sum on account of costs, unless there is good reason not to do so.”

 CPR 47.16(1) reads:

“The court may at any time after the receiving party has filed a request for a detailed assessment hearing –

(a) issue an interim costs certificate for such sum as it considers appropriate; or

(b) amend or cancel an interim certificate.”

There is therefore no reason to suppose the issue of timing has changed, assuming my interpretation is correct.

Cook on Costs appears to agree with my views as to timing:

“Where agreement has been reached by acceptance of a Part 36 offer, there is no scope to seek an interim payment of costs until a detailed assessment hearing is requested (via an interim costs certificate). Consequently, these circumstances should prove a powerful incentive for you to get your breakdown or bill drafted and submitted to the other side as soon as possible.”

That has always been my reading of the rules (pre and post-Jackson). I am just not aware of any case law confirming this.

Christmas drink recommendations

Far be it for me to tread on Dominic Regan’s toes when it comes to wine recommendations, but with the approach of Christmas I thought I would make a few drink suggestions for the festive season.

My first is Baron De Ley Reserva Rioja.

This normally retails at £12.49 a bottle from Waitrose/Ocado. However, Costco, of all places, sells this at £57.74 for 6 bottles including delivery (working out at just £9.62 a bottle). The price drops to £9.17 in the unlikely event you are also a Costco cardholder.

The description given is:

“A traditionally styled Rioja, aged for 20 months in mainly new American oak casks, this wine displays a red ruby colour with a medium-high intensity. On the nose, a remarkably powerful blend of fruit, coconut and toffee which evolves into seductive nuances of spices and Mediterranean bush.”

“Mediterranean bush”? I wouldn’t know about any of that but it is jolly tasty. Best decanted before serving and highly recommend with Christmas lunch.

Claim numbers

The Association of Personal Injury Lawyers (APIL) has been commenting on a non-story that an information request from the Compensation Recovery Unit (CRU) has shown the number of whiplash claims has fallen by 29% in only four years. There were just under 567,000 claims in the financial year 2010-11 but only 401,584 in 2013-14.

I say “non-story” as the total number of registered motor claims fell from 828,489 in 2011/12 to 772,843 in 2013/14.

Excluding non-whiplash claims from the total number of claims means the number of non-whiplash injuries has increased during the same period from 261,489 to 371,259. That is a staggering 42% increase. Now, it might be possible that non-whiplash claims have been spiralling upwards at the same time non-whiplash claims are going in the opposite direction, but the more likely explanation is that there has been a change in reporting/recording and similar claims are now been categorised in another manner.

Of more interest is the overall change in total claim numbers:

2013/14 – 1,016,801
2012/13 – 1,048,309
2011/12 – 1,041,150
2010/11 – 987,381

The first full year of the Jackson reforms has therefore seen a very modest 3% reduction in claim numbers. This is against predictions of a 25% reduction in claimant numbers. This is even more surprising when one recalls all the talk about claimant solicitors frantically trying to sign clients up before 1 April 2013. One would have expected to see a spike in 2012/13 figures followed by a reasonable drop in 2013/14 simply to reflect the front-loading of claims, even if the Jackson reforms had no actual impact on overall claim numbers. In fact, there appears to have been neither a surge in 2012/13 nor a significant drop in 2013/14.

Costs of requesting oral hearing after provisional assessment

If a party is unhappy with the outcome of a provisional assessment they have the automatic right to request an oral hearing. The large disincentive is that if they fail to achieve an improvement in their favour of 20% or more of the provisionally assessed amount that party will pay the costs of and incidental to that hearing.

I suspect that many have interpreted the rule to mean that if a party does achieve an improvement of 20% or more than they will recover their costs of the oral hearing. However, is that what the rule actually says? The wording of CPR 47.15(10) is:

“Any party which has requested an oral hearing, will pay the costs of and incidental to that hearing unless –

(a) it achieves an adjustment in its own favour by 20% or more of the sum provisionally assessed; or

(b) the court otherwise orders.”

CPR 47.15(10)(b) appears to be drafted widely enough such that the court has a discretion not to order the party who requested the hearing, but failed to achieve the 20% threshold, to pay for the costs of the hearing.

However, what costs, and by virtue of which rule, is a party who requested a hearing and achieved a 20% improvement entitled to?