Kerry Underwood

JUDGES AND EMPLOYMENT LAW: KEEP OUT OF POLITICS

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The Ultimate Judicial Irony: How can you be a Court of Appeal Judge and say this?

The case of

Tabidi v British Broadcasting Corporation [2020] EWCA Civ 733

is not particularly interesting from a legal point of view.

However, it contains the most ironic statement recently made by a member of the Senior Judiciary:

“I agree that if the customary “second appeals” criteria had applied to this jurisdiction, as they do to virtually all others, permission to appeal would have been refused. In my judgment, it is high time that that the legislation was amended to enable that test to be adopted for appeals from cases which have already had the attention, not only of the expert ET, but also of the expert EAT. I can see no rational reason for the continued exception from the “second appeals” test for cases of this character.” (Paragraph 45) –

(McCombe LJ – Sedbergh School: annual fees: £34,854.)

You allowed the appeal in part: the “expert” ET and “expert” EAT, both expertly got it wrong, so, on your logic, a wrong would have gone un-righted, on a key issue, that is that Employment Tribunals are generally cost free zones.

Also, you cannot just trot off to the Court of Appeal. You need permission, which your own colleague, Bean LJ, sensibly and correctly gave.

You also need to go through a filter system even to have a full hearing in the EAT and Judge Eady allowed the matter to proceed.

Consequently, there is already a filtering system in place that simply does not exist in the ordinary court system and thus it is harder already to bring an employment appeal than it is to bring any other type of appeal.

Parliament chose to set up the highly unusual extra appeal layer of the Employment Appeal Tribunal and Parliament chose entirely to ban the High Court from having any say in any shape or form over the employment tribunal system, to the extent that findings of the employment tribunal, for example in relation to constructive dismissal and fundamental breach in any given case, are binding on the High Court.

Parliament, not you, makes the law; these remarks show exactly why Parliament made this law, and that is because Parliament did not trust the courts to deal with employment matters fairly.

The courts do not exist for your convenience; the courts exist to do justice in accordance with the will of Parliament.

Lord Justice Underhill, – Winchester College – fees £41,708 a year -:

“I would add, finally, that this is precisely the kind of case in which permission to appeal would have been refused if a second appeals test of the kind which applies in most other fields were in place.”

So, again, Lord Justice Underhill prefers less work and an injustice as compared with the peasants being allowed to appeal.

I wonder if trade union history was on the syllabus at Sedbergh School or Winchester College.

This was the Judge who said that the High Court in UNISON – the Employment Tribunal Fees case –  was not obviously wrong in saying that a claimant left with £200 a month after essential living expenses had the “opportunity to accumulate the necessary sums over a period of months before the issue of the claim…”

Unison, R (On the Application Of) v The Lord Chancellor [2015] EWCA Civ 935

Leaving aside the fact that the time limit in Employment Tribunals is three months less a day – not much time to save is you are unemployed as a result of being unfairly dismissed – the amount left in a month for a working person covers the fees of Winchester College for approximately 1.7502637 days.

This is posted on the day that a recently retired Supreme Court Judge suggested we feel free to treat the law on Covid 19 restrictions as “ a secondary consideration” and that the Lord Chancellor said he would quit if he has broken the law in “an unacceptable manner”, suggesting that we can all break the law if it is in an acceptable manner.

Just off to rob a bank – in an acceptable manner of course.

Enough is enough.

NB –  “The second appeals test means that the court of appeal will not give permission unless it considers that the appeal would have a real prospect of success, and that it raises an important point of principle, or a practice or there is some other compelling reason for the Court of Appeal to hear it.”

Written by kerryunderwood

September 14, 2020 at 2:21 pm

Posted in Uncategorized

VIDEO LOGS

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I set out below, with links, the 10 video logs that I have posted so far.

Title
DurationDate
CONVEYANCER WANTED


2 minutes

7 September 2020
COSTS REGIMES: CONFUSION BETWEEN COURTS AND TRIBUNALS  


9 minutes

4 September 2020
DATA PROTECTION AND LEGAL PROCEEDINGS


6 minutes

4 September 2020
PROPORTIONATE COSTS ORDERS


5 minutes

31 August 2020
MY RUBBISH CASE STRUCK OUT: I WANT COSTS: 3 CRAZY CASES: 3 CORRECT DECISIONS


6 minutes

28 August 2020
DETAILED ASSESSMENT: SOME TIPS


3 minutes

28 August 2020
LITIGANTS IN PERSON: WHY I THINK THEY SHOULD BE BANNED


5 minutes

27 August 2020
INTEREST ON COSTS


10 minutes

27 August 2020
FOOTBALL MEETS THE LAW: PART 36 OFFERS IN FOOTBALL


5 minutes

26 August 2020
LEGAL SERVICES CONSUMER PANEL: SCRAP ALL THE WATCHDOGS SAYS KERRY UNDERWOOD5 minutes

25 August 2020

Written by kerryunderwood

September 7, 2020 at 12:09 pm

Posted in Uncategorized

CONVEYANCER WANTED

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Below is a 2-minute video which is a job advert for a Conveyancer for the Hemel Hempstead office of Underwoods Solicitors.

For more information contact Robert Males on 01442 430 900 and please send your CV with a covering email to Tarryn van Graan at tarryn.vangraan@lawabroad.co.uk .

Written by kerryunderwood

September 7, 2020 at 10:25 am

Posted in Uncategorized

COSTS REGIMES: CONFUSION BETWEEN COURTS AND TRIBUNALS

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This is a 9-minute video looking at the confusion between the Costs Regimes in courts and in tribunals, especially where they have joint jurisdictions, such as in employment and judicial review.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

Written by kerryunderwood

September 4, 2020 at 3:29 pm

Posted in Uncategorized

DATA PROTECTION AND LEGAL PROCEEDINGS

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This is a 6-minute video looking at Data Protection and Legal Proceedings, and in particular the fact that legal proceedings are largely exempted from the Data Protection Act 2018 and the video considers a recent Court of Appeal case.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

Written by kerryunderwood

September 4, 2020 at 3:17 pm

Posted in Uncategorized

CIVIL LITIGATION FUNDING AGREEMENTS: PART 2: DAMAGES-BASED AGREEMENTS

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This piece, in slightly different form, first appeared on the Practical Law Dispute Resolution Blog.

The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

The single potential benefit of Damages-Based Agreements is that it is a form of out and out Contingency Fee Agreement, that is taking a percentage of damages, which is available for contentious work, and thus can be used once proceedings have been issued, in contrast to a Contingency Fee Agreement under Section 57 of the Solicitors Act  1974, which cannot be used once proceedings have been issued.

It also allows for one agreement to be used from the moment the client comes in until the case is resolved, in contrast to the Underwoods Method which involves a Contingency Fee Agreement, a Bridging Agreement and a Conditional Fee Agreement, and which also involves the fact that under a Conditional Fee Agreement you cannot just take a straight percentage, but rather the lawyer’s bonus for taking the risk of not getting paid is calculated by reference to an uplift on ordinary costs.

I deal with conditional fees generally in the second part of this blog.

If it was as simple as that, then I would advise using Damages-Based Agreements all the time, but in fact I advise never using them.

There are two central problems which mean that almost no Damages-Based Agreements have been used since their inception in civil proceedings in 2013; they are compulsory if working on a contingency base in Employment Tribunal matters.

Firstly, credit must be given to the client against the contingency fee for all costs recovered from the other side, which is not the case with a Contingency Fee Agreement, and is not the case with a Conditional Fee Agreement, where the risk-based element, that is the success fee, is specifically not recoverable from the other side, and so there can never be any costs to set off against the full success fee chargeable to the client.

Under Damages-Based Agreements, but not Contingency Fee Agreements in personal injury and other civil work, there are statutory caps on the percentage damages to be charged, and these are:

Personal Injury  25%
Employment  35%
Other Civil Work  50%

All of these percentages include VAT, and in any civil case that goes the distance, or anywhere near the distance, the costs recoverable from the other side are likely to exceed 50%, and therefore the client pays nothing, and the solicitor gets not a single penny for taking the risk of no pay in the event of defeat.

Thus the solicitor is worse off in two ways as compared with charging by the hour win or lose; the first and obvious one is that the solicitor does not get paid in the event of defeat, but the second one is that even on victory and having taken the risk of getting no fee on defeat, the solicitor earns less than on the traditional hourly rate, win or lose.

This madness is known as the Ontario principle.

The second main, and related, problem is that the indemnity principle applies, and therefore the recoverable costs from the other side are limited to the amount charged in the Damages-Based Agreement, which is itself limited by Parliament.

Let us take a civil claim worth, say, £100,000 in damages and which is one.

Let us say that the recovered costs are £60,000 and the unrecovered solicitor and own client costs are £15,000.

Hourly Rate

Under the old-fashioned hourly rate, win or lose, basis the solicitor will charge £75,000 costs as follows:

                                                                                            

Recovered costs  £
60,000
Unrecovered costs payable by client  15,000
Total  75,000

Consequently, the client receives £85,000 in the damages of £100,000 less the unrecovered costs payable by the client of £15,000.

Damages-Based Agreement

The client will receive £100,000 damages as the indemnity principle limits recoverable costs to £50,000 and so that is all that the solicitor can charge, and as the whole sum is recovered from the other side, the client pays nothing at all.

Thus, the solicitor gets £50,000, rather than £75,000, even though the solicitor has taken all of the risk.

The client who has taken no risk in relation to its own lawyer’s fees, gets the full £100,000.

You could not make it up.

Damages-Based Agreements: Still Never Use Them

LEAVE TO APPEAL GRANTED BY COURT OF APPEAL

The Court of Appeal has now given permission to appeal against the decision set out below and in granting permission Lord Justice Lloyd stated:

“Although the purposive interpretation arrived at by the judge seems more likely than not to prevail in the end, the appellant’s construction is arguable, and the issue is of sufficient general importance to merit consideration by the full court.”

In

Lexlaw Ltd v Zuberi [2020] EWHC 1855 (Ch)

the Chancery Division of the High Court held that a Damages-Based Agreement which required the client to pay for time and expenses to date if the client terminated the Agreement, was a valid agreement under the Damages-Based Agreements Regulations 2013.

Here, the client sought to terminate the Agreement and the claim settled and the claimant firm of solicitors sought to recover its fees based on that settlement, under the usual principles of Damages-Based Agreements.

The client argued that as the Agreement provided for “an amount to be paid by the client” which was other than the payment calculated by reference to Regulation 4(1) of the 2013 Regulations, it was unenforceable.

The court rejected that argument.

The decision confirms what most of us thought anyway, that is that if the Agreement is terminated by the client before a right to share in any proceeds has arisen, then the solicitor can charge for work done to date on any basis specified in the Agreement, including the hourly rate.

Regulation 4 limits a solicitor’s charge to an agreed percentage of damages, not to exceed the permitted cap, plus expenses recovered from the other side.

The Chancery Division held that it was an obvious consequence of preventing representatives getting their time costs on a client determination that those representatives would be reluctant to enter into Damages-Based Agreements and that would be contrary to the purpose of making such agreements lawful, so as to facilitate access to justice.

That would have the knock-on effect of creating less choice for clients wanting to bring civil litigation claims.

Comment

This is a welcome and sensible decision, but I must admit I had always assumed that this must be the case, as it was the case under the original 2010 Regulations and there was no suggestion that different laws should apply for other civil work outside the employment jurisdiction.

It does not mean that Damages-Based Agreements are worth entering into; there are very few circumstances where a Damages-Based Agreement is to be preferred to the Underwoods Method of a pre-Action Contingency Fee Agreement under Section 57 of the Solicitors Act 1974, followed by a Conditional Fee Agreement.

The key disadvantage of Damages-Based Agreements is that the damages cap not only limits the charge to the client, but due to the indemnity principle limits recoverability from the other side.

For example, in a general civil claim the percentage limit in a Damages-Based Agreement is 50%. That means that a successful client cannot recover more than that sum from the other side.

In sharp contrast, Conditional Fee Agreements can limit the amount to be paid by the client without causing indemnity principle problems.

Furthermore credit must be given to the client for costs recovered, which in any substantial litigation means that the client will pay nothing, due to the combination of the cap, the indemnity principle and having to give credit.

In stark contrast the risk-based success fee in conditional fee agreements is not recoverable, so there can never be anything to offset against it.

Written by kerryunderwood

September 1, 2020 at 11:25 am

Posted in Uncategorized

COSTS MANAGEMENT: NEW PRACTICE DIRECTION 3E: IN EFFECT 1 OCTOBER 2020

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The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

These principles, and the whole issue of Qualified One-Way Costs Shifting, is dealt with in my book – Qualified One-Way Costs Shifting, Section 57 and Set-Off – Available from me here for £15.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

A new Costs Management Practice Direction 3E comes into force on Thursday 1 October 2020 and the text is set out below.

Paragraph 13 is likely to cause some interesting satellite litigation:

“13. Any party may apply to the court if it considers that another party is behaving oppressively in seeking to cause the applicant to spend money disproportionately on costs and the court will grant such relief as may be appropriate”

PRACTICE DIRECTION 3E – COSTS MANAGEMENT

This Practice Direction supplements Part 3

CONTENTS OF THIS PRACTICE DIRECTION

Title           Paragraph number
A. Production of costs budgetsPara. 1  
B. Documents to be lodged for costs budgeting purposesPara. 3  
C. Budget formatPara. 4  
D. AssumptionsPara. 10  
E. Budget discussion reportsPara. 11  
F. Costs management ordersPara. 12  
G. Oppressive behaviourPara. 13  

A. Production of Costs Budgets

1. In cases where the Claimant has a limited or severely impaired life expectation (5 years or less remaining) the court will ordinarily disapply cost management under Section II of Part 3.

2. An order for the provision of costs budgets with a view to a costs management order being made may be particularly appropriate in the following cases—

(a) unfair prejudice petitions under section 994 of the Companies Act 2006;

(b) disqualification proceedings pursuant to the Company Directors Disqualification Act 1986;

(c) applications under the Trusts of Land and Appointment of Trustees Act 1996;

(d) claims pursuant to the Inheritance (Provision for Family and Dependants) Act 1975;

(e) any Part 8 or other claims or applications involving a substantial dispute of fact and/or likely to require oral evidence and/or extensive disclosure; and

(f) personal injury and clinical negligence cases where the value of the claim is £10 million or more.

B. Documents to be lodged for costs budgeting purposes

3. (a) Save in exceptional circumstances or where the court orders otherwise, the parties are not expected to lodge any documents other than Precedent H and the budget discussion report. Both are annexed, to this practice direction. If the Excel format precedent on the MOJ website is used, the calculation on page one will calculate the totals automatically and the phase totals are linked to this page also.

(b) Precedent T, also annexed to this practice direction, is to be used in the event of variation of a budget pursuant to rule 3.15A.

C. Budget format

4. (a) Unless the court otherwise orders, a budget must be in the form of Precedent H annexed to this Practice Direction. It must be in landscape format with an easily legible typeface.

(b) In cases where a party’s budgeted costs do not exceed £25,000 or the value of the claim as stated on the claim form is less than £50,000, the parties must only use the first page of Precedent H.

(The wording for a statement of truth verifying a budget is set out in Practice Direction 22.)

5. In deciding the reasonable and proportionate costs of each phase of the budget the court will have regard to the factors set out at Civil Procedure Rules 44.3(5) and 44.4(3) including a consideration of where and the circumstances in which the work was done as opposed to where the case is heard.

6. The table below identifies where within the budget form the various items of work, in so far as they are required by the circumstances of your case, should be included. The time estimated may have to be justified on the budget hearing along with the grade of fee earner doing the work.

7. Allowance must be made in each phase for advising the client, taking instructions and corresponding with the other party/parties and the court in respect of matters falling within that phase.

8. The time spent in preparing the budget and associated material must not be claimed in the draft budget under any phase. The maximum figures permitted under rule 3.15(5) should be inserted once the costs budget has been approved by the court.

9. The ‘contingent cost’ sections of this form should be used for anticipated costs which do not fall within the main categories set out in this form. Examples might be the trial of preliminary issues, applications to amend, applications for disclosure against third parties or (in libel cases) applications re meaning. Costs which are disputed (such as the need for a particular expert) should be set out in the appropriate phase of the budget and if necessary marked as disputed. Only costs which are more likely than not to be incurred should be included.

(Variation of an approved or agreed budget is dealt with in rule 3.15A.)

D Assumptions

10. (a) The assumptions that are reflected in the table below are not to be repeated. Include only those assumptions that significantly impact on the level of costs claimed such as the duration of the proceedings, the number of experts and witnesses or the number of interlocutory applications envisaged. Brief details only are required in the box beneath each phase. Additional documents should only be prepared in exceptional circumstance and, where they are disregarded by the court, the cost of preparation may be disallowed.

(b) Written assumptions are not normally required by the Court in cases where the parties are only required to lodge the first page.

TABLE

PhaseIncludesDoes NOT include
Pre-actionPre-Action Protocol correspondence  

Investigating the merits of the claim and advising client  

Settlement discussions, advising on settlement and Part 36 offers  

All other steps taken and advice given pre action  


Any work already incurred in relation to any other phase of the budget  
Issue/statements of casePreparation of Claim Form  

Issue and service of proceedings

Preparation of Particulars of Claim, Defence, Reply, including taking instructions, instructing counsel and any necessary investigation

Considering opposing statements of case and advising client

Part 18 requests (request and answer)  

Any conferences with counsel primarily relating to statements of case  

Updating schedules and counter schedules of loss  

Amendments to statements of case
 

 
CMCCompletion of DQs

Arranging a CMC

Reviewing opponent’s budget

Correspondence with opponent to agree
directions and budgets, where possible  

Preparation for, and attendance at, the CMC

Finalising the order

Any further CMC that is built into the proposed directions order
 

Preparation of costs budget for first CMC
DisclosureObtaining documents from client and advising on disclosure obligations

Reviewing documents for disclosure, preparing disclosure report or questionnaire response and list

Inspection  

Reviewing opponent’s list and documents, undertaking any appropriate investigations

Correspondence between parties about the scope of disclosure and queries arising

Consulting counsel, so far as appropriate, in relation to disclosure


Applications for specific disclosure  

Applications and requests for third party disclosure
Witness StatementsIdentifying witnesses

Obtaining statements  

Preparing witness summaries  

Consulting counsel, so far as appropriate, about witness statements  

Reviewing opponent’s statements and undertaking any appropriate investigations

Applications for witness summaries


Arranging for witnesses to attend trial (include in trial preparation)
Expert ReportsIdentifying and engaging suitable expert(s)  

Reviewing draft and approving report(s)

Dealing with follow-up questions of experts

Considering opposing experts’ reports  

Any conferences with counsel primarily relating to expert evidence  

Meetings of experts (preparing agenda etc.)

Obtaining permission to adduce expert evidence (include in CMC or a separate application)  

Arranging for experts to attend trial (include in trial preparation)
PTRBundle  

Preparing and agreeing chronology, case summary and dramatis personae (if ordered and not already prepared earlier in case)  

Completing and filing pre-trial checklists
 
Correspondence with opponent to agree directions

Preparation for and attendance at the PTR


Assembling and/or copying the bundle (this is not fee earners’ work)
Trial PreparationTrial bundles

Witness summonses, and arranging for witnesses to attend trial Any final factual investigations Supplemental disclosure and statements (if required)  

Counsel’s brief fee

Agreeing brief fee

Any pre-trial conferences and advice from counsel

Pre-trial liaison with witnesses


Assembling and/or copying the trial bundle (this is not fee earners’ work)  

Counsel’s refreshers
TrialSolicitors’ attendance at trial  

All conferences and other activity outside court hours during the trial

Attendance on witnesses during the trial  

Counsel’s trial refreshers  

Dealing with draft judgment and related applications


Preparation for trial
 
Counsel’s brief fee for trial (include in trial preparation)
ADR/SettlementAny conferences and advice from counsel in relation to settlement

Work directed to settlement negotiations and meetings between the parties and any other ADR (including mediation), to include Part 36 and other offers and advising the client  

Approval of settlement if needed  

Drafting settlement agreement or Tomlin order  

Advice to the client on settlement (excluding advice included in the pre action phase)

 

E. Budget discussion reports

11. The budget discussion report required by rule 3.13(2) must set out—

(a) those figures which are agreed for each phase;

(b) those figures which are not agreed for each phase; and

(c) a brief summary of the grounds of dispute.

The parties are encouraged to use the Precedent R Budget Discussion Report annexed to this practice direction.

F. Costs management orders

12. When reviewing budgeted costs, the court will not undertake a detailed assessment in advance, but rather will consider whether the budgeted costs fall within the range of reasonable and proportionate costs.

G. Oppressive behaviour

13. Any party may apply to the court if it considers that another party is behaving oppressively in seeking to cause the applicant to spend money disproportionately on costs and the court will grant such relief as may be appropriate.

Written by kerryunderwood

September 1, 2020 at 9:53 am

Posted in Uncategorized

PROPORTIONATE COSTS ORDERS

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This is a 5-minute video on Proportionate Costs Orders.

This is not about proportionality, but rather where the court orders a percentage of costs, and not full costs, to the winner on the basis that they have failed on some issues.

The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

Written by kerryunderwood

August 31, 2020 at 12:06 pm

Posted in Uncategorized

MY RUBBISH CASE STRUCK OUT: I WANT COSTS: 3 CRAZY CASES: 3 CORRECT DECISIONS

with 6 comments


Here I look at 3 decisions – all absolutely correctly decided – where losing parties argued against paying costs, or even sought them, on the basis that their cases were so weak that the winning defendants should have applied to strike them out.

Happily the courts rejected such bizarre arguments; as I point out in the video had they not done so then this would have created a whole new sector – No Lose – No Fee, where solicitors would only take on the worst cases in the hope that they would get costs for them not being struck out.

It is a 6-minute video examining the cases and also looking at the harm that such applications do to the arguments of those representing genuine personal injury claimants with genuine injuries.

The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

Written by kerryunderwood

August 28, 2020 at 12:16 pm

Posted in Uncategorized

DETAILED ASSESSMENT: SOME TIPS

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In this 3-minute video I look at a case where costs were disallowed in full due to misconduct during the assessment proceedings and give some tips on how to avoid problems on assessment.

The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

Written by kerryunderwood

August 28, 2020 at 9:00 am

Posted in Uncategorized

CIVIL LITIGATION FUNDING AGREEMENTS: PART 1: CONTINGENCY FEE AGREEMENTS

with 2 comments


This piece, in slightly different form, first appeared on the Practical Law Dispute Resolution Blog.

The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

Many general civil litigators are unaware of the range of funding options open to clients and lawyers in such proceedings, and tend to stick limpet-like to an hourly rate, win or lose, which is deeply unattractive to most clients, and is not necessarily the most profitable method for the solicitors either.

I know only too well that civil litigation can take all sorts of unexpected twists and turns, but generally payment by the hour rewards the inefficient and punishes lawyers who get a good result early on, often because of their reputation and knowledge of the law.

Here I look at two species of Contingency Fee, that is a payment of a percentage of damages, with no costs if the case is lost, and in the next piece I will look at Conditional Fee Agreements, where it is not all or nothing as solicitors and clients can have No win, Lower Fee Agreements.

Contingency Fee Agreements

Contingency Fee Agreements have been allowed in non-contentious work since at least 1729 – see the Solicitors and Attorneys Act 1729.

The current governing legislation is Section 57 of the Solicitors Act 1974.

The Pre-Issue Contingency Fee Agreement

Pre-issue work in all matters is classed as non-contentious business within the meaning of Section 57 of the Solicitors Act 1974, and therefore can be carried out under a contingency fee agreement.

However, once the case is issued then that pre-issue work retrospectively becomes contentious and thus the contingency fee agreement is of no effect.  The solution is to enter into a conditional fee agreement and a contingency fee agreement from Day One.

The agreement with the client will be that the contingency fee agreement operates until proceedings are issued at which point it drops away and the conditional fee agreement is deemed to have been in place from the beginning.  This is achieved by a bridging agreement.

Absent contractual agreement with the other side there is no right to costs pre-issue and therefore it does not matter that the conditional fee agreement is not in place.  Costs are only payable by agreement; if they are agreed then there is no problem and if they are not agreed then proceedings will need to be issued at which point the conditional fee agreement comes in to force with effect from the beginning of the case.

The potential problem is that fees on an hourly basis, even with a success fee, may be significantly less than the contingency fee would have been.  That will depend upon a combination of the settlement figure and the contingency fee percentage on the one hand and the time spent and the hourly rate on the other hand.

Thus where there is a contingency fee agreement you should have a high hourly rate in the conditional fee agreement.

Solicitor and own client rates can and should be very much higher than the rates that you are likely to recover on a between the parties basis, on the standard basis.

This is for two reasons:

(i) to maximize the alternative “take” to the contingency fee; and

(ii) to maximize the indemnity costs received if, as a claimant, you match or beat your own Part 36 offer.

Such agreements cannot be used in employment tribunal work, where you must use a Damages-Based Agreement if working on a contingent basis, even in relation to pre-issue work.

Apart from employment cases, such agreements are specifically excluded from the provisions of The Damages-Based Agreements Regulations 2013 by Regulation 1(4) of those same Regulations:

“(4) Subject to paragraph (6), these Regulations shall not apply to any damages-based agreement to which section 57 of the Solicitors Act 1974 (non-contentious business agreements between solicitor and client) applies.”

The paragraph (6) exception reads:

“(6) Where these Regulations relate to an employment matter, they apply to all damages-based agreements signed on or after the date of which these Regulations come into force.”

As the Explanatory Note to The Damages-Based Agreements Regulations states:

“…section 58AA(9) of the [Courts and Legal Services] Act provides that, where section 57 of the Solicitors Act 1974 (c.47) applies to a DBA (other than one relating to an employment matter) it is not unenforceable only because it does not satisfy the conditions in section 58AA (4), under which these Regulations are made. Accordingly article 1(4) [sic – should read Regulation 1(4) – articles apply to Orders not Regulations] excludes those DBAs to which sections 57 of the Solicitors Act 1974 applies from the scope of these Regulations.”

Section 57 of the Solicitors Act 1974 has itself been amended by section 98 of the Courts and Legal Services Act 1990 and sections 117 and 221 of, and schedule 16 to, the Legal Services Act 2007, and now reads:

“57 Non–contentious business agreements

(1) Whether or not any order is in force under section 56, a solicitor and his client may, before or after or in the course of the transaction of any non–contentious business by the solicitor, make an agreement as to his remuneration in respect of that business.

(2) The agreement may provide for the remuneration of the solicitor by a gross sum or by reference to an hourly rate, or by a commission or percentage, or by a salary, or otherwise, and it may be made on the terms that the amount of the remuneration stipulated for shall or shall not include all or any disbursements made by the solicitor in respect of searches, plans, travelling, taxes, fees or other matters.

(3) The agreement shall be in writing and signed by the person to be bound by it or his agent in that behalf.

(4) Subject to subsections (5) and (7), the agreement may be sued and recovered on or set aside in the like manner and on the like grounds as an agreement not relating to the remuneration of a solicitor.

(5) If on any assessment of costs the agreement is relied on by the solicitor and objected to by the client as unfair or unreasonable, the costs officer may enquire into the facts and certify them to the court, and if from that certificate it appears just to the court that the agreement should be set aside, or the amount payable under it reduced, the court may so order and may give such consequential directions as it thinks fit.

(6) Subsection (7) applies where the agreement provides for the remuneration of the solicitor to be by reference to an hourly rate.

(7) If, on the assessment of any costs, the agreement is relied on by the solicitor and the client objects to the amount of the costs (but is not alleging that the agreement is unfair or unreasonable), the costs officer may enquire into—

(a) the number of hours worked by the solicitor; and

(b) whether the number of hours worked by him was excessive.”

It will be seen that section 57(2) specifically sanctions remuneration by way of a percentage.

There is no statutory cap on the percentage that may be charged to a client under a pre-issue contingency fee agreement but solicitors have a duty not to exploit clients and a duty to conduct themselves in a way that does not bring the profession into disrepute. Charging an unfairly high percentage risks putting a solicitor in breach of these duties.

The agreement must be in writing and must be signed by the client (section 57(3) Solicitors Act 1974).

We insert a default hourly rate of £480 including VAT as that is now our standard rate for most types of work, including work in preparation for multi-track cases. Solicitors can put in the figure that they think fit, but this must be discussed and agreed with the client. You can have different rates for different levels of lawyer and work, but one of the benefits of contingency fee agreements is their simplicity.

The protection and value to the client is that they pay nothing in the event of failure to obtain damages.

The client is guaranteed a fixed percentage of anything recovered.

A Contingency Fee Agreement gives greater protection to clients than a conditional fee agreement, as recognized in a an interesting, accurate and telling part of the High Court’s judgment in Bolt Burdon Solicitors v Tariq & Ors [2016] EWHC 811 (QB) (13 April 2016)

“156 Mr Mallalieu submitted strongly that the questions of fairness and reasonableness were not to be tested by the outcome, but by reference to the reasonable perception at the time the agreement was entered into. He submits that any analogy or comparison with a conditional fee agreement is wholly inappropriate. By way of illustration, assume a conditional fee agreement with an uplift of 100%. Solicitors incur costs of £200,000, which with the mark up of 100%, entitles them to £400,000. If the sum recovered in the proceedings is £1million, this may be a satisfactory outcome for the client. But if instead, after the same amount of work, the recovery in the proceedings is only £50,000, there would still be the same liability to pay costs of £400,000. This is because in a conditional fee agreement costs are always tied to the work done, whereas in a contingency fee agreement costs are always proportionate to recovery. Mr Mallalieu submits that to grant the relief sought in this case would be to destroy the commerciality of contingency fee agreements of this kind.”

For example, if the contingency fee is 40% then the fixed percentage of damages to the client is 60% and if it is a 30% contingency fee then it is 70% and so on.

Detailed guidance is given by the Court of Appeal in Rees v Gately Wareing [2014] EWCA Civ 1351.  Note that once proceedings are issued you must not use a contingency fee agreement, even if you are not on the record, or are merely assisting another solicitor.

Written by kerryunderwood

August 28, 2020 at 8:15 am

Posted in Uncategorized

LITIGANTS IN PERSON: WHY I THINK THEY SHOULD BE BANNED

with 6 comments


This is a 5-minute video on why I say litigants in person should be banned from courts, just as patients are not allowed to operate on themselves in hospital. These videos are meant to be thought-provoking and debate stimulating😊

See my other video logs:

LEGAL SERVICES CONSUMER PANEL: SCRAP ALL THE WATCHDOGS SAYS KERRY UNDERWOOD

FOOTBALL MEETS THE LAW: PART 36 OFFERS IN FOOTBALL

INTEREST ON COSTS

Written by kerryunderwood

August 27, 2020 at 12:05 pm

Posted in Uncategorized

INTEREST ON COSTS

with 2 comments


The cases discussed in this video log are dealt with in my written blog post –

INTEREST ON COSTS: COURTS MAKING IT UP AS THEY GO ALONG.

This video is 10 minutes long. It contains proposals for unifying and changing the law in relation to interest on costs.

The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

These principles, and the whole issue of Qualified One-Way Costs Shifting, is dealt with in my book – Qualified One-Way Costs Shifting, Section 57 and Set-Off – Available from me here for £15.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

See my other video logs:

LEGAL SERVICES CONSUMER PANEL: SCRAP ALL THE WATCHDOGS SAYS KERRY UNDERWOOD

FOOTBALL MEETS THE LAW: PART 36 OFFERS IN FOOTBALL

LITIGANTS IN PERSON: WHY I THINK THEY SHOULD BE BANNED

Written by kerryunderwood

August 27, 2020 at 8:32 am

Posted in Uncategorized

SOCIAL SECURITY: MISCELLANEOUS: UPPER TRIBUNAL CASES 2019/20

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Here I look at Upper Tribunal decisions, that is decisions on appeal, in relation to Social Security.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Administrative Appeals Chamber: Social Security: Miscellaneous

CitationPartiesJurisdictionCommentary
[2019] UKUT 144 (AAC)NA v Secretary of State for Work and Pensions (BB)Social SecurityThe Upper Tribunal decided that the surviving partner of a religious marriage recognised in Pakistan, but not recognised in England and Wales, was entitled to a bereavement payment and widowed parent’s allowance. The State’s refusal to provide the appellant with a bereavement payment is contrary to Article 14 of the European Convention on Human Rights read in conjunction with Article 1 of the First Protocol and the difference in treatment was not objectively justified and proportionate as per Re McLaughlin [2018] UKSC 48. For the purposes of entitlement to both bereavement payment and widowed parent’s allowance, the relevant secondary legislation (the Social Security and Family Allowances (Polygamous Marriages) Regulations 1975 (SI 1975/561)) can be read down under section 3 of the Human Rights Act 1998 so as to be Convention-compliant.    

[2019] UKUT 203 (AAC)JB v Secretary of State for Work and Pensions (PIP)Social SecurityThe Upper Tribunal decided that the First-tier Tribunal had erred by failing to adequately enquire into and through failing to make any findings about the claimant’s ability to follow the route of an unfamiliar journey without another person, even if it can be assumed that the entirety of any such journey could be undertaken by driving. It follows that even where the bulk of the journey may be accomplished by driving there must be at least small parts of it, which will have to be accomplished by other means.  
 
[2019] UKUT 207 (AAC)RT v Secretary of State for Work and Pensions (PIP)Social SecurityThe Upper Tribunal decided that the First-tier Tribunal had failed to consider how to facilitate the giving of evidence by a vulnerable adult as required by the Practice Statement; First Tier and Upper Tribunal – Child, Vulnerable Adult and Sensitive Witnesses. Such consideration must be undertaken consciously and it is good practice for the tribunal to note in the record of proceedings that this has occurred, and failing that, at the least, any written statement of reasons must refer to the fact that the tribunal considered how to facilitate the giving of evidence by the claimant and explain what the tribunal had decided giving a brief explanation.    

[2019] UKUT 361 (AAC)AM v Secretary of State for Work and Pensions and City and County of Swansea CouncilSocial SecurityThe Upper Tribunal decided that there was no “secondary” or contingent right to reside under European Union law as the primary carer of an under school age child where that child’s right to reside is based on his being the family member of the other parent, who has a right to reside, but where the child’s primary carer is not a family member of that other parent. It further decided that there was no right of residence arising as an extended family member when there was no residence document in place. The Upper Tribunal also decided that there is no power for the Upper Tribunal to award costs on an appeal from the Social Entitlement Chamber of the First-tier Tribunal.    

[2020] UKUT 28 (AAC)BN v (1) Liverpool City Council (2) Secretary of State for Work and PensionsSocial SecurityThe Upper Tribunal decided that the First-tier Tribunal had erred in law and the claimant is entitled to housing benefit to cover the payments by way of service charge on the property which her late father occupied as his home. It decided that the tenancy of the property is a shared ownership tenancy granted by a housing association and is within the exception in paragraph 12(2)(a) of the Housing Benefit Regulations 2006 to the prohibition on payment of a rent allowance in respect of periodical payments made under a long tenancy.    

[2020] UKUT 48 (AAC)Secretary of State for Work and Pensions v AJ (UC)Social SecurityThe Upper Tribunal considered this appeal by the Secretary of State in a universal credit case where the claimant had been sentenced to a term of imprisonment. It decided that a claim to universal credit made on release fell within regulation 22 of the Universal Credit (Temporary Provisions) Regulations 2014 so that the Limited Capability for Work Related Activity element of the award ran from three months after the date of claim and the effect of imprisonment on entitlement to income support was suspensory.

[2019] UKUT 415 (AAC)SW v Secretary of State for Work and PensionsSocial SecurityThe Upper Tribunal decided that a reconvened hearing in the First-tier Tribunal must be before exactly the same panel or a completely different one.  

Written by kerryunderwood

August 26, 2020 at 12:02 pm

Posted in Uncategorized

FOOTBALL MEETS THE LAW: PART 36 OFFERS IN FOOTBALL

with 2 comments


In this 5-minute video, I suggest introducing Part 36 offers into Professional Football.

Football fans – be patient – your time comes at about 1 minute 50 seconds 😊

See my other video logs:

LEGAL SERVICES CONSUMER PANEL: SCRAP ALL THE WATCHDOGS SAYS KERRY UNDERWOOD

INTEREST ON COSTS

LITIGANTS IN PERSON: WHY I THINK THEY SHOULD BE BANNED

Written by kerryunderwood

August 26, 2020 at 10:00 am

Posted in Uncategorized

SOCIAL SECURITY: CHILD SUPPORT: UPPER TRIBUNAL CASES 2019/20

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Here I look at Upper Tribunal decisions, that is decisions on appeal, in relation to Social Security in Child Support cases.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Administrative Appeals Chamber: Social Security: Child Support

CitationPartiesJurisdictionCommentary
[2019] UKUT 149 (AAC)EA v Secretary of State for Work and Pensions and SA (CS)Social SecurityThe Upper Tribunal considered shared care under Regulation 46 of the Child Support Maintenance Calculation Regulations 2012 and whether shared care should be determined on the basis of provisions for contact in a court order, even though the specified overnight contact had not been happening. It decided that although the tribunal must consider the terms of the court order, it is not obliged to determine shared care in accordance with its terms.    

[2019] UKUT 151 (AAC)AR v Secretary of State for Work and Pensions, Her Majesty’s Revenue and Customs and LR (No.2)Social SecurityThe Upper Tribunal considered the meaning of “latest available tax year” and whether regulations 4 and 36 of the Child Support Maintenance Calculation Regulations 2012 were in conflict. The non-resident parent was subject to PAYE real time information procedures but also required to lodge P11D and self-assessment return (SAR). There was no change to tax liability following such lodgement. It decided the key point is that regulation 36 is the primary provision in defining what is meant by the “Her Majesty’s Revenue and Customs figure”; regulation 4 is merely a subsidiary definition provision. It follows that regulation 4(1) must be read in such a way that it is consistent with the purpose of regulation 36(1), namely the focus on all sources of income charged to tax for the same “latest available tax year”.    

[2019] UKUT 199 (AAC)GC v Secretary of State for Work and Pensions & AE (CSM)Social SecurityThe Upper Tribunal decided that the appellant’s liability for Child Support in respect of one son should be recalculated to take into account his liability to support his other son who lived in Denmark, under an informal arrangement made without a court order. The Upper Tribunal considered the operation of regulation 52 and regulation 48 of the Child Support Maintenance Calculation Regulations 2012 and decided that there was a clear policy intent to encourage parents to come to mutually agreed effective arrangements outside the statutory scheme.    

[2019] UKUT 289 (AAC)WC v Commissioners for Her Majesty’s Revenue and CustomsSocial SecurityThe Upper Tribunal decided that child benefit can be exported under Article 7 of Regulation (EC) 883/2004 and the priority rules for overlapping family benefits in Article 68 of that Regulation do not apply when the claimant is receiving benefit in only one State.    

[2019] UKUT 314 (AAC)BB v Secretary of State for Work and Pensions and CB (CSMSocial SecurityThe Upper Tribunal decided that in considering a claim for child support under the third child maintenance scheme established by the Child Support Act 1991 and as amended by the Child Maintenance and Other Payments Act 2008, a redundancy payment was not to be treated as part of a non-resident parent’s current income for the purpose of assessing his child support liability.    

[2020] UKUT 65 (AAC)MZ v Commissioners for Her Majesty’s Revenue and CustomsSocial SecurityThe Upper Tribunal considered family benefits where the father had not claimed child benefit and the mother and daughter had never lived in the United Kingdom. The mother did not qualify for family benefits in Poland on account of her income. She did not qualify for child benefit either under domestic law read alone or in conjunction with EU law. The Upper Tribunal explained the scope of EU family law provisions.  

Written by kerryunderwood

August 26, 2020 at 7:16 am

Posted in Uncategorized

LEGAL SERVICES CONSUMER PANEL: SCRAP ALL THE WATCHDOGS SAYS KERRY UNDERWOOD

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Written by kerryunderwood

August 25, 2020 at 1:00 pm

Posted in Uncategorized

SOCIAL SECURITY: PERSONAL INDEPENDENCE PAYMENT: UPPER TRIBUNAL CASES 2019/20

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Here I look at Upper Tribunal decisions, that is decisions on appeal, in relation to Social Security and Personal Independence Payments.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Administrative Appeals Chamber: Social Security: Personal Independence Payment

CitationPartiesJurisdictionCommentary
[2019] UKUT 179 (AAC)JB v Secretary of State for Work and PensionsSocial SecurityThe Upper Tribunal decided two procedural issues in an appeal against the refusal of a Personal Independence Payment (“PIP”) claim. Firstly, the extent of the Registrar’s powers in the First-tier Tribunal when determining which papers should be included in the appeal bundle before the First-tier Tribunal and secondly the admissibility of an audio recording of a consultation with an Health Care Professional made covertly by the appellant and whether it should have been admitted by the First-tier Tribunal. The Upper Tribunal decided that in this case the Registrar had exceeded her powers and that the First-Tier Tribunal had been wrong to avoid the issue regarding the covert recording and transcript in its decision.
   
[2019] UKUT 270 (AAC)PA v Secretary of State for Work and PensionsSocial SecurityThe Upper Tribunal decided that the First-tier Tribunal had erred in law in respect of daily living activity 2 (taking nutrition) in the Social Security (Personal Independence Payment) (“PIP”) Regulations 2013. It had made insufficient findings of fact to support its decision that the claimant didn’t require prompting to take nutrition, it misunderstood the proper meaning of “take nutrition”, it failed to consider regulation 4(2A) of the PIP Regulations in sufficient detail and the reasons for its decision were inadequate.  

[2019] UKUT 320 (AAC)DA v Secretary of State for Work and Pensions (PIP)Social SecurityThe Upper Tribunal decided that the First-tier Tribunal had applied the correct test and reached the inevitable conclusion that a bottle and sterilised water used to wash after going to the toilet was not an “aid” in respect of the definition of “aid or appliance” in the Social Security (Personal Independence Payment) Regulations 2013 because the claimant had no impaired function relating to the activity of cleaning herself, and because the process was a preventative therapy rather than something which made it easier or possible for her to clean herself. It also stressed the importance of identifying the “impaired function” in order to apply that definition properly.  

[2020] UKUT 22 (AAC)TK v Secretary of State for Work and PensionsSocial SecurityThe Upper Tribunal considered the Social Security (Personal Independence Payment) Regulations 2013 and decided that activity 3 can apply where a person needs assistance because of the nature of the tasks involved in therapy rather than because of a physical or mental impairment in performing the tasks. It considered the meaning and application of “limited by a person’s physical or mental condition” in section 78 Welfare Reform Act 2012. Furthermore activity 2 can apply where, due to lack of appetite, a person needs prompting to eat a sufficient quantity of food.    

Written by kerryunderwood

August 25, 2020 at 12:00 pm

Posted in Uncategorized

SOCIAL SECURITY: EMPLOYMENT: UPPER TRIBUNAL CASES 2019/20

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Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

Here I look at Upper Tribunal decisions, that is decisions on appeal, in relation to Social Security in the Employment context.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Administrative Appeals Chamber: Social Security: Employment

CitationPartiesJurisdictionCommentary
[2019] UKUT 114 (AAC)JW v Her Majesty’s Revenue & CustomsSocial SecurityThe Upper Tribunal decided that the First-tier Tribunal had erred in law in finding that the business of the “self employed” appellant as defined in the Working Tax Credit (Entitlement and Maximum Rate) Regulations 2002 was not carried out on a commercial basis as a trade, profession or occupation because it was unprofitable applying a test of “genuine and effective”. There was also a subsidiary issue as to the circumstances in which the Upper Tribunal will hear an appeal against a decision of the First-tier Tribunal in a case challenging a decision under Section 16 of the Tax Credits Act 2002 when a Section 18 decision has subsequently been issued.

[2019] UKUT 118 (AAC)SA v Secretary of State for Work and Pensions (ESA)Social SecurityThe Upper Tribunal considered regulations 23 and 24 of the Employment and Support Allowance Regulations 2008 and the meaning of “good cause” in respect of failure to attend a medical examination. It decided that regulation 24 which requires that the claimant’s “state of health at the relevant time” be considered means the time at which the claimant was required to attend and submit to the medical examination. The requirement to consider the claimant’s “state of health” relates to the degree of the claimant’s health problems at that time. Regulation 24(c) requires the decision maker or tribunal to consider “the nature of any disability the claimant has”. This could include, in relation to a condition that does not affect the claimant all the time, the pattern of the claimant’s symptoms so does not preclude an approach looking beyond the day of the appointment.

 
[2019] UKUT 135 (AAC)JS v Secretary of State for Work and Pensions (IS)Social SecurityThe Upper Tribunal decided that “Saint-Prix” retention of worker status in respect of “right to reside” may extend to other situations where a claimant has needed temporarily to cease working. It also considered the correct approach to proportionality and “lacuna filling” after Mirga. The circumstances of this case were whether the appellant had a right to reside at the time he made his claim for income support in March 2011 and whether his personal circumstances in March 2011, having given up his employment in February 2011 to care for his very young (and in one case seriously disabled) children because they otherwise would be ‘taken into care’, conferred on him a right to reside under EU law.  

[2019] UKUT 220 (AAC)LG v Secretary of State for Work and Pensions (ESA)Social SecurityThe Upper Tribunal decided, on an appeal about Income Related Employment and Support Allowance (ESA (IR)), that some payments from a trust should have been taken into account rather than others in determining whether the claimant met the financial conditions for ESA (IR).  

[2019] UKUT 284 (AAC)CM v Secretary of State for Work and Pensions (ESA)Social SecurityThe Upper Tribunal decided that EI v Secretary of State for Work and Pensions (ESA) [2016] UKUT 397 (AAC) was wrongly decided on two points. The first concerned the powers of the First-tier Tribunal on an appeal from a decision made by the Secretary of State under Regulation 30 of the Employment and Support Allowance (“ESA”) Regulations 2008 on a second or repeat claim. The second concerned the wording in Regulation 30(1) “to be treated as having limited capability for work until such time as it is determined whether or not the claimant has limited capability for work”.  

[2019] UKUT 374 (AAC)IR v Secretary of State for Work and Pensions (PIP)Social SecurityThe Upper Tribunal allowed the claimant’s appeal and decided that as a general rule the Secretary of State should have produced the letter arranging the assessment interview with a Health Care Professional so that the First-tier Tribunal could be satisfied that attendance was a requirement and failure to attend would have consequences. In this particular case the Upper Tribunal was not persuaded that the letter from Atos imposed a mandatory legal requirement to attend.  

 
[2020] UKUT 50 (AAC)KH v Bury MBC and Secretary of State for Work and Pensions (HB)Social SecurityThe Upper Tribunal decided that the “genuine chance of being engaged” test under regulation 6(2) (b)(ii) of the Immigration (EEA) Regs 2006 is contrary to European Union law in respect of those with retained worker status under Article 7(3)(b) of Directive 2004/38/EC and considered whether European Union law differs in this context between mere workseekers and those seeking to retain worker status by jobseeking. It also decided that the appeal was not correctly a referral case under section 9(5) b) of the Tribunals, Courts and Enforcement Act 2007.  

[2020] UKUT 53 (AAC)AH v Secretary of State for Work and PensionsSocial SecurityThe Upper Tribunal decided that an insured person under Regulation (EC) 883/2004 is not necessarily someone who has rights by virtue of insurance or contributions. Article 21 applies to those persons and members of their family even if the benefits in question are not ones that the claimant is claiming in their own right and not by virtue of being a member of the family. An insured person who is pursuing employment has priority over one who is not. It further decided that this result is consistent with freedom of movement and is not inconsistent with EU law. In this the Upper Tribunal rejected the argument that the child’s best interests could override Article 21 or be used to interpret it.    

[2020] UKUT 59 (AAC)PPE v Secretary of State for Work and PensionsSocial SecurityThe Upper Tribunal considered the requirement in respect of employment and support allowance to attend a medical examination under Regulation 23(2) of the Employment and Support Allowance Regulations 2008 and the meaning of “fails … to attend”, whether “failure” can occur in the absence of a legal obligation to attend and whether the standard Medical Services appointment letter imposes a legal obligation to attend. The Tribunal also considered whether the First-tier Tribunal can properly dismiss an appeal against a decision treating a claimant as not having limited capability for work under regulation 23 of the Employment and Support Allowance Regulations 2008 without evidence of the terms of the appointment letter.    

[2020] UKUT 66 (AAC)DD v Her Majesty’s Revenue and Customs & Secretary of State for Work and Pensions (CB)Social SecurityThe Upper Tribunal considered the adequacy of the HM Revenue and Customs’ (HMRC) guidance on how to apply the “genuine chance of being engaged in employment” test in relation to a jobseeker’s right to reside for the purposes of entitlement to child benefit. The Upper Tribunal found that the wrong version of regulation 6 of the Immigration (European Economic Area) Regulations 2006 had been applied both by HMRC in its appeal response to the First-tier Tribunal and by the First-tier Tribunal in its decision.  
 

Written by kerryunderwood

August 25, 2020 at 8:34 am

Posted in Uncategorized

REPRESENTATIVE ACTIONS

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Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In

Jalla and others v Royal Dutch Shell plc and others [2020] EWHC 2211 (TCC)

the High Court held that the claimants in a representative action did not satisfy the “same interest” requirement under CPR 19.6(1) and struck out the representative elements of the proceedings, leaving only the personal claims of the two lead claimants.

CPR 19.6(1) provides:

“Where more than one person has the same interest in a claim –

(a) the claim may be begun; or

(b) the court may order that the claim be continued,

by or against one or more of the persons who have the same interest as representatives of any other persons who have that interest.”

The proceedings were brought by the two lead claimants “and others” in 2017, after an oil spill in Nigeria. “Others” included thousands of individuals and hundreds of communities, all allegedly exposed to the oil spill.

Here the court carried out an exhaustive review of the authorities, many of which were decided under the previous incarnation of CPR 19.6(1) which was contained in RSC Ord 15, r12 (1).

In particular the court examined in detail, the leading case of

The Duke of Bedford v Ellis and others [1901] AC 1

which remains good law.

Here, in Paragraph 60, the court set out the principles drawn together from the case law:

“i) Representative proceedings are not the only vehicle for multi-party litigation: see the citation from Zuckerman at [52] above;

ii) The requirement in CPR r. 19(6)(1) that persons have “the same interest” is statutory and is not to be abrogated or substituted by reference to the overriding objective. That said, the rule is to be interpreted having regard to the overriding objective and should not be used as an unnecessary technical tripwire: see [44]-[45], [53] above;

iii) The purpose of a representative action is to accommodate multiple parties who have the same interest in such a way as to go as far as possible towards justice rather than to deny it altogether. This is done by adopting a structure which can “fairly and honestly try the right”: see the citation from page 10 of the Duke of Bedford case at [31] above;

iv) It is for this reason that representative proceedings may be appropriate where the relief sought is in its nature beneficial to all whom the lead claimants propose to represent: see the citation from page 8 of the Duke of Bedford case at [31] above and see [47] above;

v) The “same interest” which the represented parties must have is a common interest, which is based upon a common grievance, in the obtaining of relief that is beneficial to all represented parties: see [47] above. It is not sufficient to identify that multiple claimants wish to bring claims which have some common question of fact or law;

vi) It is not necessary that the claims or causes of action of all represented parties should be congruent, provided that they are in effect the same for all practical purposes: see [39] and [49] above;

vii) The existence of individual claims over and above the claim for relief in which the represented parties have the same interest does not necessarily render representative proceedings inapplicable or inappropriate: see [38] above. The question to be asked is whether the additional claims can be regarded as “a subsidiary matter” or whether they affect the overall character of the litigation so that it becomes or approximates to a series of individual claims which raise some common issues of law or fact: see [33] above;

viii) Similarly, while the court will pay little attention to potential individual defences that are merely theoretical, the existence of potential defences affecting some represented parties’ claims but not those of others tends to militate against representative proceedings being appropriate. One reason for this is that it may be procedurally difficult or impossible to accommodate individual defences in representative proceedings, though the rules make provision for affected parties to be protected: see [53] above. Another is that if a defence is available in answer to the claims of some but not others of the represented class they have different interests in the action: see [56] above. Adopting slightly different language, I would add that the existence of individual defences calls into question whether the action really is a claim for relief that is beneficial for all or is a collection of individual claims sharing some common issues of fact or law;

ix) If the criterion of “the same interest” is satisfied the Court’s discretion to permit representative proceedings to continue should be exercised in accordance with the overriding objective.”

The judge also clarified the test to determine whether a person is in a particular represented class, suggesting that the touchstones should be ability to clearly define the class without internal conflicts, ability to evidence inclusion within the class, whether by self-certification or otherwise, and sharing the same interest in the outcome (Paragraph 68).

Applying the relevant principles, the judge found that these were individual claims because each claimant needed to prove that the oil spill caused them damage.

Estoppel

The court also considered the law of estoppel including:

(a) estoppel by convention;

(b) litigation estoppel and the doctrine prohibiting approbation and reprobation; and

(c) issue estoppel.

The court dealt with these matters at paragraphs 81 to 83:

“81. Litigation estoppel or the doctrine prohibiting approbation and reprobation may arise where a party adopts two inconsistent attitudes towards another party. In appropriate cases “he must elect between them and, having elected to adopt one stance, cannot thereafter be permitted to go back and adopt an inconsistent stance”: see Express Newspapers Plc v News (UK) Ltd [1990] 1 WLR 1320 at 1329 per Lord Browne-Wilkinson VC. It reflects “the unwillingness of the courts to countenance inconsistent conduct by one party where this is prejudicial to the other”: see Benedictus v Jalaram Ltd (1989) 58 P. & C.R 330 at 344-345 per Bingham LJ. As the explanatory example given by Bingham LJ in Benedictus illustrates, it is founded upon the Court’s view that for a party to take unfair litigation advantage of another by founding on the truth of an assertion of fact but subsequently to deny that fact in order to obtain further litigation advantage is (or may be) unconscionable.

82. The third type of estoppel upon which the Claimants rely is based on the concept of abuse of the process articulated by Wigram VC in Henderson v Henderson (1843) 3 Hare 100, 115. As such it may stretch wider than a “pure” issue estoppel such as described in Arnold v National Westminster Bank plc [1991] 2 AC 93,105E:

“Issue estoppel may arise where a particular issue forming a necessary ingredient in a cause of action has been litigated and in subsequent proceedings between the same parties involving a different cause of action to which the same issue is relevant, one of the parties seeks to reopen the issue.”

83. The Henderson v Henderson line of authority has been helpfully summarised by Pepperall J in Mansing Moorjani v Durban Estates Limited [2019] EWHC 1229 (TCC) at [17.4]:

“Even if the cause of action is different, the second action may nevertheless be struck out as an abuse under the rule in Henderson v. Henderson where the claim in the second action should have been raised in the earlier proceedings if it was to be raised at all. In considering such an application:

a) The onus is upon the applicant to establish abuse.

b) The mere fact that the claimant could with reasonable diligence have taken the new point in the first action does not necessarily mean that the second action is abusive.

c) The court is required to undertake a broad, merits-based assessment taking account of the public and private interests involved and all of the facts of the case.

d) The court’s focus must be on whether, in all the circumstances, the claimant is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before.

e) The court will rarely find abuse unless the second action involves “unjust harassment” of the defendant”.”

Written by kerryunderwood

August 25, 2020 at 8:17 am

Posted in Uncategorized

SPECIAL EDUCATIONAL NEEDS AND DISABILITIES: UPPER TRIBUNAL DECISIONS

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Here I look at Upper Tribunal decisions, that is decisions on appeal, in relation to Special Educational Needs and Disabilities.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Administrative Appeals Chamber: Special Educational Needs and Disabilities

CitationPartiesJurisdictionCommentary
[2019] UKUT 223 (AAC)L v Governing Body of Cherry Lane Primary School (SEN)SENDThe Upper Tribunal decided that Rule 12(3)(a) of the Health, Education and Social Care Rules cannot be relied on to extend the six-month time limit for making a claim under the Equality Act 2010. In this case the First-tier Tribunal erred in law in its approach to the 2010 Act’s provisions by allowing an application for an extension of time to be considered.

[2019] UKUT 240 (AAC)Derbyshire County Council v MooreSENDThe Upper Tribunal decided that there was no absolute requirement for all Education and Healthcare Plans to specify a particular school or other institution in section 1 even where section 61 of Children and Families Act 2014 applies (“education otherwise than in school”) and that M & M v West Sussex County Council (SEN) [2018] 347 (AAC) was incorrectly decided on that point.  

[2019] UKUT 243 (AAC)Nottinghamshire County Council v SF and GDSENDThe Upper Tribunal decided that the First-tier Tribunal had not erred in its construction of section 37 of Children and Families Act 2014 and in particular its approach to whether an Education, Health and Care plan (“EHC”) plan is necessary for a six-year-old with diagnoses of Autism Spectrum Disorder, Developmental Coordination Disorder and hypermobility, who attended a maintained mainstream school.  

[2019] UKUT 259 (AAC)Proprietor of Ashdown House School v (1) JKL (2) MNPSENDThe Upper Tribunal decided that the school had discriminated against a child on the basis of his disability under section 15 of the Equality Act 2010 and ordered that it withdraw its exclusion of him and reinstate him with support and extra tuition for lost learning as well as an apology.

Written by kerryunderwood

August 21, 2020 at 7:33 am

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MENTAL HEALTH: UPPER TRIBUNAL DECISIONS

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Here I look at Upper Tribunal decisions, that is decisions on appeal, in relation to Mental Health.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Administrative Appeals Chamber: Mental Health

CitationPartiesJurisdictionCommentary
[2019] UKUT 172 (AAC)JS v South London and Maudsley NHS Foundation Trust and the Secretary of State for JusticeMental HealthThe Upper Tribunal provided guidance and explained the structured approach to be followed by a tribunal when considering whether to allow a party to reinstate their case. The appellant in this case was a patient liable to be detained under the Mental Health Act 1983. He applied to the First-tier Tribunal for this liability to be discharged and then withdrew that application. It also explains why Hospital Trusts are correctly respondents on appeals by mental patients to the Upper Tribunal.

[2019] UKUT 323 (AAC)SLL v (1) Priory Health Care and (2) Secretary of State for JusticeMental HealthThe Upper Tribunal set out the proper test for deciding whether the discharge of a restricted patient should be absolute or conditional where at least one of the section 72(1)(b) of the Mental Health Act 1983 criteria is not met as well as the factors that the Tribunal must consider when assessing whether it is “appropriate” for the patient to continue to be liable to recall to hospital for further treatment.  

Written by kerryunderwood

August 21, 2020 at 7:29 am

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LETTINGS AGENCY: UPPER TRIBUNAL DECISIONS

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Here I look at Upper Tribunal decisions, that is decisions on appeal, in relation to Lettings Agency.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Administrative Appeals Chamber: Lettings Agency

CitationPartiesJurisdictionCommentary
[2019] UKUT 110 (AAC)London Borough of Newham v Samson Estates LtdLettings AgencyThe Upper Tribunal decided that a residential leasehold property manager must belong to a redress scheme that specifically covers the relevant activity in compliance with the requirements of The Redress Schemes for Lettings Agency Work and Property Management Work (Requirement to Belong to a Scheme etc) (England) Order 2014.  


[2019] UKUT 139 (AAC)G Crawford Management Services Ltd v London Borough of Tower HamletsLettings AgencyThe Upper Tribunal decided that the appellant company was in breach of the requirements of The Redress Schemes for Lettings Agency Work and Property Management Work (Requirement to Belong to a Scheme etc) (England) Order 2014. The appellant company was established to minimise liability for tax and national insurance purposes. As a matter of law, if any of the activities of the appellant was done “in the course of a business”, then there was a duty to belong to a redress scheme. The fact that there was (and was only ever intended to be) only one client or customer did not prevent the activities being done “in the course of a business”.  

Written by kerryunderwood

August 21, 2020 at 7:24 am

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DAMAGES-BASED AGREEMENTS: THE LEXLAW CASE: COURT OF APPEAL GRANTS LEAVE TO APPEAL

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The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

The Court of Appeal has now given permission to appeal against the decision set out below and in granting permission Lord Justice Lloyd stated:

“Although the purposive interpretation arrived at by the judge seems more likely than not to prevail in the end, the appellant’s construction is arguable, and the issue is of sufficient general importance to merit consideration by the full court.”

In

Lexlaw Ltd v Zuberi [2020] EWHC 1855 (Ch)

the Chancery Division of the High Court held that a Damages-Based Agreement which required the client to pay for time and expenses to date if the client terminated the Agreement, was a valid agreement under the Damages-Based Agreements Regulations 2013.

Here, the client sought to terminate the Agreement and the claim settled and the claimant firm of solicitors sought to recover its fees based on that settlement, under the usual principles of Damages-Based Agreements.

The client argued that as the Agreement provided for “an amount to be paid by the client” which was other than the payment calculated by reference to Regulation 4(1) of the 2013 Regulations, it was unenforceable.

The court rejected that argument.

The decision confirms what most of us thought anyway, that is that if the Agreement is terminated by the client before a right to share in any proceeds has arisen, then the solicitor can charge for work done to date on any basis specified in the Agreement, including the hourly rate.

Regulation 4 limits a solicitor’s charge to an agreed percentage of damages, not to exceed the permitted cap, plus expenses recovered from the other side.

The permitted caps are as follows:

Personal Injury  25%
Employment  35%
Other work  50%

The Chancery Division held that it was an obvious consequence of preventing representatives getting their time costs on a client determination that those representatives would be reluctant to enter into Damages-Based Agreements and that would be contrary to the purpose of making such agreements lawful, so as to facilitate access to justice.

That would have the knock-on effect of creating less choice for clients wanting to bring civil litigation claims.

Comment

This is a welcome and sensible decision, but I must admit I had always assumed that this must be the case, as it was the case under the original 2010 Regulations and there was no suggestion that different laws should apply for other civil work outside the employment jurisdiction.

It does not mean that Damages-Based Agreements are worth entering into; there are very very few circumstances where a Damages-Based Agreement is to be preferred to the Underwoods method of a pre-Action Contingency Fee Agreement under Section 57 of the Solicitors Act 1974, followed by a Conditional Fee Agreement.

The key disadvantage of Damages-Based Agreements is that the damages cap not only limits the charge to the client, but due to the indemnity principle limits recoverability from the other side.

For example, in a general civil claim the percentage limit in a Damages-Based Agreement is 50%. That means that a successful client cannot recover more than that sum from the other side.

In sharp contrast, Conditional Fee Agreements can limit the amount to be paid by the client without causing indemnity principle problems.

Furthermore credit must be given to the client for costs recovered, which in any substantial litigation means that the client will pay nothing, due to the combination of the cap, the indemnity principle and having to give credit.

In stark contrast the risk-based success fee in conditional fee agreements is not recoverable, so there can never be anything to offset against it.

Written by kerryunderwood

August 20, 2020 at 2:43 pm

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SITE OF SPECIAL SCIENTIFIC INTEREST: UPPER TRIBUNAL DECISIONS

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Here I look at Upper Tribunal decisions, that is decisions on appeal, in relation to Site of Special Scientific Interest.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Administrative Appeals Chamber: Site of Special Scientific Interest

CitationPartiesJurisdictionCommentary
2019] UKUT 300 (AAC)Natural England v Warren (MISCMISCThe Upper Tribunal decided in respect of a Site of Special Scientific Interest (“SSSI”) that the Firsttier Tribunal was not bound by the requirements of Regulation 63 of the Conservation of Habitats and Species Regulations 2017 and thereby Article 6(3) of Directive 92/43 in terms of assessing the implications of a plan or project on a special area of conservation or a special protection area. The tribunal was not a competent authority on which the Regulations imposed such obligations. However, it was bound to apply the principles governing the competent authority’s assessment, including the precautionary principle.

Written by kerryunderwood

August 20, 2020 at 11:39 am

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ARMED FORCES: UPPER TRIBUNAL DECISIONS

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Here I look at Upper Tribunal decisions, that is decisions on appeal, in relation to Armed Forces.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Administrative Appeals Chamber: Armed Forces

CitationPartiesJurisdictionCommentary
[2019] UKUT 154 (AAC)KF v Secretary of State for Defence (WP)Armed ForcesThe Upper Tribunal decided that the tribunal should apply its own consideration of the admissibility of expert evidence in the particular circumstances of the case before it, given the general rule in relation to the admission of evidence.

Written by kerryunderwood

August 20, 2020 at 11:35 am

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INFORMATION RIGHTS: UPPER TRIBUNAL DECISIONS

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Here I look at Upper Tribunal decisions, that is decisions on appeal, in relation to Information Rights.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Administrative Appeals Chamber: Information Rights

CitationPartiesJurisdictionCommentary
[2019] UKUT 185 (AAC)Davies v 1. The Information Commissioner; 2. The Cabinet Office (GIA)Information RightsThe Upper Tribunal considered Section 36 of the Freedom of Information Act, the standard of reasons required for a decision as to the reasonableness of the qualified person’s opinion and the duty of a tribunal to give closed reasons where the required standard of reasons cannot be met in open. It gave guidance as to the duty of tribunals to address the principal issues raised in closed proceedings even where the issues were subsequently agreed by those privy to the closed proceedings. The Upper Tribunal remade the decision in this case, finding that the qualified person’s opinion was not reasonable and, in any event, the public interest favoured disclosure.  


[2019] UKUT 247 (AAC)Vesco v (1) Information Commissioner and (2) Government Legal DepartmentInformation RightsThe Upper Tribunal considered an appeal concerning a request for environmental information within the Environmental Information Regulations 2004 (“EIRs”) which implement obligations under EU Council Directive 2003/4/EC which in turn falls to be interpreted in accordance with the Aarhus Convention. It decided that the First-tier Tribunal erred in law by failing to apply all applicable tests under Regulation 12 of the EIRs.  


[2019] UKUT 269 (AAC)Sygulska v (1) The Information Commissioner (2) The Ministry of DefenceInformation RightsThe Upper Tribunal decided that the First-tier Tribunal had not erred in law in deciding that disclosure of Second World War service records would be unfair under section 40 of the Freedom of Information Act (FOIA) and that condition 6(1) of Schedule 2 of the Data Protection Act 1998 (DPA) was not satisfied. In the absence of proof of death such as a death certificate or equivalent document, the Ministry of Defence was entitled to ask for and receive a declaration of death from the relevant legal authorities before disclosing a serviceman’s record unless 116 years had passed since his date of birth.  

Written by kerryunderwood

August 20, 2020 at 11:28 am

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QUALIFIED ONE-WAY COSTS SHIFTING APPLIES TO CLAIMANTS, NOT PROCEEDINGS

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These principles, and the whole issue of Qualified One-Way Costs Shifting, is dealt with in my book – Qualified One-Way Costs Shifting, Section 57 and Set-Off – Available from me here for £15.

The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In

Anne Morgan (on behalf of herself and of the estate of Mr Christopher John Morgan) v Dr Chongtham Singh, Sheffield County Court, (unreported)

a Circuit Judge on appeal considered whether Qualified One-Way Costs Shifting (QOCS) applied to the whole proceedings, or could be split between different claimants, the significance being that a claimant with a Conditional Fee Agreement with a recoverable additional liability is disqualified from QOCS protection, and this is generally known as a pre-Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO) funding agreement.

Here Christopher Morgan had such a pre-LASPO Conditional Fee Agreement with a recoverable success fee and After-the-Event insurance premium, and such an agreement disqualifies a claimant from the protection of QOCS.

He died.

His widow entered into a post-LASPO Conditional Fee Agreement, without a recoverable success fee, both in relation to the action on behalf of the estate in her capacity as executrix, and in relation to her own action as a dependant.

She lost and a costs order was made against her in the usual way and the issue was whether or not she was entitled to the protection of QOCS, which would make the order unenforceable.

It was agreed that Mr Morgan did not have QOCS protection, but Mrs Morgan had neither a recoverable success fee, nor a recoverable ATE insurance premium. The post death premium was an unrecoverable new premium for a new policy and not a top-up.

Consequently, had Mrs Morgan won, she would not have been entitled to recover either the success fee or the insurance premium from the date of her husband’s death.

Mrs Morgan argued that that meant that she was not disqualified from the protection of QOCS.

The defendant relied on the concept that QOCS applied to the whole proceedings, or not at all, and that as the pre- death part of the proceedings was not QOCS protected, none of the proceedings was.

The District Judge, in a finding upheld by the Circuit Judge on appeal, held that QOCS applied to individual personal injury claimants and not proceedings, and consequently Mrs Morgan, not having the benefit of recoverability of the additional liabilities, was protected by QOCS.

 

The protection applies not to the proceedings, but to:

 

“… the enforcement of orders for costs made against a claimant’’

 within those proceedings (CPR 44.14).

 

There was nothing in the Civil Procedure Rules to prevent a finding that Mr Morgan was the claimant in the proceedings up to his death and Mrs Morgan thereafter in her capacity as executrix in the same proceedings, as well as on her own behalf as a dependant.

It was the status and legal entity of the claimant, and not the proceedings themselves, which had altered.

“Proceedings” can have different meanings in the context of different situations.

 

On appeal the defendant argued:

 

  • QOCS applies or does not apply to “proceedings” and that this was (as the respondent conceded) one set of “proceedings”. QOCS has to apply to all of the defendant’s costs or none of those costs.
  • QOCS had been treated as applying or not applying to a particular claimant when there was no basis in the rules for such an approach.
  • The decision gave the effect that a single costs order in favour of one party and against another party is partially enforceable and partially unenforceable. There is no basis for such a result in the QOCS rules.
  • CPR 44.17 should be construed so that it caught Mr Morgan’s pre-commencement funding arrangements even while Mrs Morgan was the claimant.
  • The decision imposed the worst of both regimes on the appellant in that he would have been liable to pay a success fee and for an ATE insurance premium had the claim succeeded, but he cannot recover the bulk of his costs now that it has failed.

 

The Circuit Judge rejected the appeal:

 

“The parties were new. The CFA was new. The constituent components comprising the balance of risk were new.”

 

He accepted that the Civil Procedure Rules did not deal with this point. (Holy Civil Procedure Rule Clarity- well there is a surprise Batman).

 

“It seems to me that the purpose of QOCS regime is to give protection to individuals rather than to the somewhat ethereal concept of ‘proceedings’. It is not ‘proceedings’ which require QOCS protection. It is individual claimants. It is not ‘proceedings’ which enter into pre-April 2013 CFAs and ATEs. It is individuals. It is not ‘proceedings’ against which costs orders are made. It is claimants. That is surely why CPR 44.14(1) and (2) speak of ‘orders for costs made against a claimant”.

 

A claimant cannot use QOCS to gain an advantage. That was not the position here.

 

Comment

A considered, sensible and just decision.

As I said at the outset, to overturn several hundred years of costs rules in half a page of Civil Procedure Rules was unlikely to introduce clarity.

When it comes to court rules, brevity = litigation.

Written by kerryunderwood

August 19, 2020 at 10:01 am

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EMPLOYMENT: KEY CASE LAW 2019/20

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Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

Kerry Underwood is a former Employment Tribunal Judge.

This selection of key cases is taken from the Senior President of Tribunals’ Annual Report 2020 which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

In

Curless v Shell International Ltd [2019] EWCA Civ 1710

the Court of Appeal explores the application of the iniquity principle in the context of the admissibility of emails in ET proceedings to which legal advice privilege might otherwise have attached.

 

The right to rest breaks under the Working Time Regulations was considered by the Court of Appeal in

Network Rail Infrastructure Ltd v Crawford [2019] EWCA Civ 269.

It is not necessary for an equivalent period of compensatory rest to amount to an uninterrupted period of 20 minutes.

Whether the rest afforded was equivalent is a matter for the informed judgment of the specialist employment tribunal.

 

In

BMC Software Ltd v Shaikh [2019] EWCA Civ 267

the Court of Appeal rules that, while the Employment Appeal Tribunal (EAT) can require an ET to state its reasons for a judgment under appeal at the sift stage or at a preliminary hearing (the Burns/Barke procedure), it cannot do so as part of its final disposal of the appeal.

 

An equal pay claim is a claim for arrears of pay, permitting an employee to make a claim for an unpaid debt against the National Insurance Fund in the context of insolvency, ruled the Court of Appeal in

Graysons Restaurants Ltd v Jones [2019] EWCA Civ 725.

 

Important guidance on the application of rule 50 and the Sexual Offences (Amendment) Act 1992 when restricted reporting orders are sought in connection with allegations of sexual offences made in claims before an employment tribunal is provided by the EAT in

A and B v X and Times Newspapers Ltd [2019] IRLR 620.

 

It is not unlawful sex discrimination for employers to pay men on shared parental leave less than women on statutory maternity leave:

Capital Customer Management Ltd v Ali; Chief Constable of Leicestershire Police v Hextall [2019] EWCA Civ 900   (Court of Appeal).

 

In

Kuteh v Dartford & Gravesham NHS Trust [2019] EWCA Civ 716

the central issue was whether a Christian nurse was unfairly dismissed for alleged gross misconduct in initiating religious discussions with patients despite reassuring management that she would not do so.

Was her conduct protected by article 9, European Convention on Human Rights (ECHR)?

The Court of Appeal held that it was not, drawing a distinction between the manifestation of a religious belief and the inappropriate promotion of that belief.

 

The Court of Appeal decision in

FCO v Bamieh [2019] EWCA Civ 803

is an unusual illustration of whether the employment tribunal had extraterritorial jurisdiction in an international law context of two co-workers seconded to the EULEX mission in Kosovo and where the claim by one co-worker against the other derived from the whistleblowing provisions of the Employment Rights Act 1996.

It did not.

 

How should an employment tribunal accommodate the needs of a disabled person participating in its proceedings?

Helpful guidance on this difficult issue is beginning to emerge from the higher courts, not least in the Court of Appeal decisions in

J v K [2019] EWCA Civ 5

and

Anderson v Turning Point Eespro Ltd [2019] EWCA Civ 815.

 

East of England Ambulance Service NHS Trust v Flowers [2019] EWCA Civ 947

explores whether voluntary overtime should be accounted for in the calculation of holiday pay against the background of a collective agreement (the NHS Agenda for Change).

The effect of the collective agreement was to ensure a contractual entitlement to holiday pay based on voluntary overtime. The Court of Appeal also grapples with counter-intuitive language on voluntary overtime in the CJEU decision in Hein.

Section 145B of the Trade Union & Labour Relations (Consolidation) Act 1992 is an example of an area of the ET’s jurisdiction that spills over into collective labour law. It is concerned with “inducements relating to collective bargaining”.

 

The Court of Appeal overrules both the ET and the EAT in their interpretation of the section in

Kostal UK Ltd v Dunkley [2019] EWCA Civ 1009.

 

The Court of Appeal confirms that the recast definition of direct discrimination in the Equality Act 2010 has the effect that a disability discrimination claim can be brought by a claimant who is perceived to be disabled even though she is not:

Chief Constable of Norfolk v Coffey [2019] EWCA Civ 1061.

 

In a case originating in an unfair dismissal claim in the ET arising from a complaint of harassment the European Court of Human Rights (ECrtHR) considers the application of article 8 ECHR privacy rights to evidential material relating to the employee’s mobile phone, email and WhatsApp messages provided to the employer by the police:

Garamukanwa v UK [2019] IRLR 853.

 

On the first occasion that the Court of Appeal has considered regulation 5(1) of the Agency Workers Regulations, it holds that the Regulations do not entitle agency workers to work the same number of contractual hours as a comparator:

Kocur v Angard Staffing Solutions Ltd [2019] EWCA Civ 1185.

 

The defence of statutory illegality in relation to employment contractual claims, and where reliance was placed by the employer on the Immigration, Asylum and Nationality Act 2006, was considered by the Court of Appeal in

Okedina v Chikale [2019] EWCA Civ 1393.

 

In

McNeil v HMRC [2019] EWCA Civ 1112

the Court of Appeal reviews how the principles of indirect discrimination apply in equal pay claims.

The appeal is of particular interest because of how the court addresses the arguments based upon statistical analysis that were presented to it.

 

In

L v Q Ltd [2019] EWCA Civ 1417

the Court of Appeal rules that the ET has no power in its procedural rules (apart from national security cases) to prohibit the online publication of a judgment.

 

The Court of Appeal in

Harpur Trust v Brazel [2019] EWCA Civ 1402

decides that there is no basis for calculating holiday pay on a pro rata basis for a part-time worker who worked part of the year.

 

The putative status of judges as workers under employment rights legislation is explored by the Supreme Court in

Gilham v Ministry of Justice [2019] UKSC 44.

 

The difficulty of establishing a philosophical belief as a protected characteristic under the Equality Act 2010 (here belief in the statutory and moral right to copyright) is illustrated in

Gray v Mulberry Company (Design) Ltd [2019] EWCA Civ 1720.

 

In an unfair dismissal claim where there is both an invented reason and a hidden reason for dismissal, it is the hidden reason that falls to be tested says the Supreme Court:

Royal Mail Group Ltd v Jhuti [2019] UKSC 55.

 

The latest guidance on the application of disciplinary procedures in the workplace is provided by the Court of Appeal in

Sattar v Citibank NA [2019] EWCA Civ 2000.

 

In whistleblowing claims the test of whether a disclosure was made “in the public interest” is a two-stage test which must not be elided. The claimant must (a) believe at the time that he was making it that the disclosure was in the public interest and (b) that belief must be reasonable:

Ibrahim v HCA International Ltd [2019] EWCA Civ 2007.

 

A claimant in a whistleblowing case must be able to show that they have suffered a detriment in the employment field and not, for example, as a resident vis-à-vis a council’s powers as a local authority rather than as an employer:

Tiplady v City of Bradford [2019] EWCA Civ 2180.

 

When does time limitation start to run in the judicial pensions litigation? From the date of retirement when a pension might otherwise fall due to be paid, rules the Supreme Court in

Miller v Ministry of Justice [2019] UKSC 60.

Written by kerryunderwood

August 19, 2020 at 8:27 am

Posted in Uncategorized

EMPLOYMENT: LEGISLATION 2019/20

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Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

Kerry Underwood is a former Employment Tribunal Judge.

 

Primary Legislation

There was no primary legislation in relation to employment law in 2019/20.

 

Secondary Legislation

Set out below is the Secondary Legislation passed by Parliament in relation to employment matters in 2019/20. 

 

Automatic Enrolment (Earnings Trigger and Qualifying Earnings Band) Order 2019;

Data Protection, Privacy and Electronic Communications (Amendments etc) (EU Exit) Regulations 2019;

Cross-Border Mediation (EU Directive) (EU Exit) Regulations 2019;

Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019;

Agricultural Wages (Wales) Order 2019;

Employment Rights (Amendment) (EU Exit) Regulations 2019;

Employment Rights (Amendment) (EU Exit) (No 2) Regulations 2019;

Agency Workers (Amendment) Regulations 2019;

Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2019;

Employment Rights (Miscellaneous Amendments) Regulations 2019; and

Companies (Directors’ Remuneration Policy and Directors’ Remuneration Report) Regulations 2019.

Written by kerryunderwood

August 19, 2020 at 7:20 am

Posted in Uncategorized

CONDITIONAL FEE AGREEMENTS: NO WIN, LOWER FEE: LUMP SUM DISCOUNTED FEE: PAYMENT OUT BY COURT IN FRAUD LITIGATION

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The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

The consultancy includes the drafting of Funding Agreements, including the type of Conditional Fee Agreement used in this case, and Kerry Underwood has written over 50 different types of Conditional Fee Agreements.

In

Skatteforvaltningen (The Danish Customs And Tax Admin) v Solo Capital Partners LLP & Ors [2020] EWHC 2161 (Comm)

a fraud case where where both the claimant and some defendants claimed a proprietary interest in monies held in court, the Commercial Court allowed the defendants a limited payment for legal fees, balancing the competing interests by adopting an approach that reduced the risk of the funds being exhausted by payments of legal fees which exceeded those reasonably incurred to date.

The defendants’ legal team were retained on a no win lower fee conditional fee agreement with an agreed total discounted base fee which became due on signature of the Conditional Fee Agreement, which contained rights of termination for non-payment.

Applying

Marino v FM Capital Partners [2016] EWCA Civ 1301

and

Kea Investments Ltd v Watson [2020] EWHC 473 (Ch),

the court had to ascertain whether the defendants had access to other assets to meet legal fees and, if not, weigh the apparent injustice of releasing the funds against the possible injustice to the defendants of not doing so.

The defendants currently had access to no other assets, but certain assets, not subject to legal restraint, might be liquidated over the next 18 months.

The court declined to order payment out of the entire sum due under the Conditional Fee Agreement, as this would immediately be consumed, regardless of the reasonable value of the work done to date.

One of the defendants’ investments was maturing in January 2021. The judge therefore ordered payment out of a sum to cover certain outstanding fees and incurred costs, plus the estimated legal costs to be incurred under the Conditional Fee Agreement, calculated on a conventional charging basis, up to 31 January 2021, plus disbursements outside the Conditional Fee Agreement.

Although the judge did not know what effect his order would have on the defendants’ legal team’s willingness to continue under the Conditional Fee Agreement, that did not lead him to conclude that the balance of interests he had struck was unfair.

The defendants’ Conditional Fee Agreement was “an unconventional mechanism to funding High Court litigation” and the contractual terms agreed between the defendants and their lawyers could not be allowed to trump the court’s decision.

 

Comment

An interesting example of an extremely substantial piece of litigation described by the court as “one of the largest and most complexed pieces of litigation to be heard in the Commercial Court” being dealt with by way of a conditional fee agreement.

It is also an interesting example of a defendant being represented under a Conditional Fee Agreement and, unsurprisingly, on a no win, lower fee basis, a model that I recommend in commercial proceedings.

It is further interesting in that the lower fee is calculated as a lump sum, rather than by work done, and again this is very much my model for acting on a No win, Lower fee Conditional Fee Agreement for a defendant.

Written by kerryunderwood

August 18, 2020 at 8:55 am

Posted in Uncategorized

UPPER TRIBUNAL: SOCIAL SECURITY CASES

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In this series, I look at the key decisions in the last year in the Social Entitlement Chamber that are reported in the Upper Tribunal.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Social Entitlement Chamber cases reported in the Upper Tribunal

CitationPartiesJurisdictionCommentary
[2018] UKUT 446 (AAC)MM v Secretary of State for Work and Pensions (ESA)Social securityThe Upper Tribunal warned First-tier Tribunals against concluding that claimants do not suffer from the loss of function that they describe on the basis that they are not being correctly treated for the condition(s) that cause that loss of function.
 
[2019] UKUT 55 (AAC)Secretary of State for Work and Pensions v SO (DLA)Social securityThe appellant in this case was a Dutch national who had been awarded invalidity benefit in Holland. The Upper Tribunal decided that, when he came to live in the UK, he was not entitled to the care component of Disability Living Allowance (DLA) because the Dutch invalidity benefit was a pension which made Holland the ‘competent state’ (i.e. responsible for paying benefits) even though he was resident in the UK. If the competent state for the care component is not the UK the claimant may still be entitled to the mobility component under the domestic rules.
 
[2019] UKUT 83 (AAC)JG v Secretary of State for Work and Pensions (CA)Social securityThe Upper Tribunal decided that the state responsible for paying benefit (the ‘competent state’) is the state of residence of the claimant under Regulation (EC) 1408/71 and 883/2004 even in a case where the person being cared for is entitled to Attendance Allowance or Disability Living Allowance.  

[2019] UKUT 84 (AAC)Secretary of State for Work and Pensions v MC (DLA)Social securityIn this decision the Upper Tribunal found that, as the claimant had moved residence and was now employed in another Member State, Article 22 of Regulation (EC) 1408/71 did not apply to allow him to export his award of Disability Living Allowance because he had taken up employment in a new state and the Secretary of State had not authorised the move.  

[2019] UKUT 85 (AAC); [2019] AACR 22KR v Secretary of State for Work and Pensions (DLA)Social securityIn this case the Upper Tribunal decided that a claimant can export an award of Disability Living Allowance care component (i.e. continue to be entitled to payment of the benefit from the UK when moving to another EU country), relying on Article 7 or 21 of Regulation (EC) 883/2004.
 
[2019] UKUT 86 (AAC)Secretary of State for Work and Pensions v TG (DLA)Social securityThe Upper Tribunal judge decided that Regulation (EC) 883/2004 applied to the claimant because his claim for Disability Living Allowance (DLA) had been made after 1.5.10 when that Regulation came into force. Although the appellant had previously been employed in the UK and was insured to obtain a retirement pension in due course he was not “pursuing an activity as an employed or self-employed person”. He was habitually resident now in Cyprus so Cyprus was the state responsible for paying benefits (the ‘competent state’) and he could not therefore receive DLA from the UK.
 
[2019] UKUT 87 (AAC)GK v Secretary of State for Work and Pensions (CA)Social securityThe Attendance Allowance (AA) recipient moved to Cyprus and invited the claimant to join her to care for her. He claimed Carer’s Allowance from Cyprus. The Upper Tribunal decided that under Article 11 (3)(e) of Regulation (EC) 883/2004 it was Cyprus as the state of residence which determined that Cyprus and not the UK was the competent state for the claimant even though it was the UK which was the competent state for the AA recipient. Note: this decision is under appeal to Court of Appeal.  

[2019] UKUT 113 (AAC)UA v Her Majesty’s Revenue Service (TC)Social securityThe Upper Tribunal explained in its decision that it is important for tribunals to assess evidence and to make appropriate findings within the relevant cultural context, in this case to take account of the pressure the claimant felt that Islamic culture placed on her to have a successful marriage and the shame associated with separation from a spouse.  

[2019] UKUT 114 (AAC); [2019] AACR 23JW v Her Majesty’s Revenue and Customs (TC)Social securityThe Upper Tribunal considered the relevance of profitability and “genuine and effective” work as tests for the commercial basis of self-employment for Working Tax Credit.  

[2019] UKUT 118 (AAC)SA v Secretary of State for Work and Pensions (ESA)Social securityThe Upper Tribunal decided that, in the absence of any express obligation in the regulations 23 and 24 of the Employment and Support Allowance 2008, it was not reasonable to infer “a general obligation on claimants to engage in a significant degree of forward planning” in order to attend a medical examination.

[2019] UKUT 135 (AAC); [2019] AACR 24 (AAC)JS v Secretary of State for Work and Pensions (IS)Social securityThe Upper Tribunal considered how far the Court of Justice judgment in St Prix on the retention of worker status in right to reside cases may extend to other situations where the claimant has ceased work temporarily.  

[2019] UKUT 144 (AAC)NA v Secretary of State for Work and Pensions (BB)Social securityThe Upper Tribunal found that the refusal of the claim for bereavement benefit and widowed parent’s allowance to the surviving widow of overseas religious marriage was unlawful discrimination contrary to the European Convention on Human Rights. The claimant was in an analogous situation to a widow in a recognised lawful marriage under UK law.  

[2019] UKUT 149 (AAC)EA v Secretary of State for Work and Pensions and SA (CS)Social securityThe Upper Tribunal decided that, although the tribunal must consider the terms of a court order, it is not obliged under Regulation 46 of the Child Support Maintenance Calculation Regulations 2012 to determine shared care in accordance with those terms where the overnight contact specified in the court order is not in reality being adhered to.  

[2019] UKUT 151 (AAC); [2019] AACR 25AR v Secretary of State for Work and Pensions, HM Revenue and Customs and LR (No.2)Social securityThis was an Upper Tribunal child support decision which tackled the interpretation and application of regulations 4 and 36 of the Child Support Maintenance Calculation Regulations 2012; in particular the meaning of the “latest available tax year” in the context of the provision of information by HMRC on the non- resident parent’s income.  

[2019] UKUT 192 (AAC)ODS v Secretary of State for Work and Pensions (UC)Social securityThe Upper Tribunal decided that the legal effect of the judgment of the European Court of Justice in Lounes is that dependent EEA family members of dual nationals can derive a right of residence where the dual national has exercised free movement rights in the host Member State prior to acquiring the citizenship of that State.  

[2019] UKUT 204 (AAC)TM v Secretary of State for Work and Pensions (PIP)Social securityThe Secretary of State’s response, as well as failing to include the PIP activities and descriptors, as required, referred to draft legislation that was not in the same terms that the tribunal was required to apply. This failure had the potential to cause unfairness because it denied the claimant information that he needed to prepare his case properly. The Tribunal breached its duty to act fairly towards the claimant in failing to take steps to rectify the inadequacies in the Secretary of States’ response.  

[2019] UKUT 207 (AAC)RT v Secretary of State for Work and Pensions (PIP)Social securityThe Upper Tribunal discussed the obligations of the First-tier Tribunal in appeals involving vulnerable adults and provides practical guidance as to when omitting to follow the Practice Direction on Child, Vulnerable Adult and Sensitive Witnesses is likely to amount to a material error of law.  

[2019] UKUT 250 (AAC)Secretary of State for Work and Pensions v NZ (ESA)Social securityIn this final decision on the case, the Upper Tribunal decided that factual, not legal, residence is what is required by Article 17(1)(b) of Directive 2004/38. This meant that the right of permanent residence in the host Member State shall be enjoyed by ‘A8 nationals’ before the completion of a continuous period of five years residence by workers or self-employed persons who have resided continuously there for more than two years and stop working due to permanent incapacity to work.  

[2019] UKUT 284 (AAC)CM v Secretary of State for Work and Pensions (ESA)Social securityThe Upper Tribunal dealt with two issues here: the powers of First-tier Tribunal on an appeal from a Secretary of State decision under regulation 30 on a second or repeat ESA claim; and the legal effect of words in regulation 30(1) “until such time as it is determined”.  

[2019] UKUT 294 (AAC)MB v Secretary of State for Work and Pensions (SPC)Social securityThere was a conflict between the first Tribunal’s decision and the statement of reasons as to the amount of the overpayment. This decision was subsequently set aside by a second Tribunal as incoherent and fundamentally flawed. The Upper Tribunal decided that this set aside decision was properly made under the Tribunal Procedure Rules, even though the District Tribunal Judge did not refer to the legal power(s) under which he was acting.  

[2019] UKUT 314 (AAC)BB v Secretary of State for Work and Pensions and CB (CSM)Social securityThis Upper Tribunal decision explored the relevant tax law on the treatment of redundancy payments, the definition of earned income and the definition of historic and current income for both employed and self- employed people in child support law.  

[2019] UKUT 321 (AAC)EB v Secretary of State for Work and Pensions and CWSocial securityThe Upper Tribunal’s decision here involved the treatment of income where there is a change, where there is income from both employment and self- employment and where the tribunal may have to choose between using historic and current income.  

[2019] UKUT 329 (AAC)SMcD v Secretary of State for Work and Pensions and LT (CSM)Social securityThe Upper Tribunal found that there had been procedural unfairness where the Financially Qualified Member’s analysis of the father’s income was shared by the tribunal at the hearing but with no prior warning or adjournment opportunity for the father to study the figures. Such disclosure by the tribunal should be made with sufficient time for the parties to consider it.  

[2019] UKUT 408 (AAC)KB v Secretary of State for Work and Pensions (UC)Social securityThe Upper Tribunal decided that the claimant in this case did not have ‘good reason’ for failing to apply for a job where she had previously agreed with her work coach that she would apply for it but subsequently decided not to do so because she believed it was pointless but without consulting with her work coach as to why she believed that to be the case.  

[2020] UKUT 10 (AAC)ES (and his appointee CS) v Secretary of State for Work and Pensions (DLA)Social security  In this case the child’s language delay meant it was much more difficult to understand what was troubling him and it made soothing him to sleep much more protracted than was typical for a child of his age. The Upper Tribunal decided that the First-tier Tribunal was wrong to attempt to trace a link between the child’s difficulty in getting back to sleep with a physical or mental cause. Its focus should have been on the “attention required in connection with the bodily function of communication” and not of sleeping.  

[2020] UKUT 22 (AAC)TK v Secretary of State for Work and Pensions (PIP)Social securityThe Upper Tribunal found that Personal Independence Payment (PIP) Activity 3 (“managing therapy”) includes the assistance with therapy which the claimant requires because the nature of the activity itself calls for it, not just because of a physical or mental impairment in performing the tasks required in managing therapy.  

[2020] UKUT 50 (AAC)KH v Bury Metropolitan Borough Council and Secretary of Work and PensionsSocial securityThis decision by the Upper Tribunal considered the “genuine chance of being engaged” test under reg. 6(2)(b)(ii) of the Immigration (EEA) Regs 2006 and concluded that this test did not need to be met by those who retained their worker status having been made involuntary unemployed after having been employed for more than one year. The test is about ability and availability to re-enter the labour market “within a reasonable period of time” rather than the prospect of in fact being employed.  


[2020] UKUT 59 (AAC)PPE v Secretary of State for Work and Pensions (ESA)Social securityThe Upper Tribunal explained in this decision what is required in order to impose a legal obligation on a claimant to attend a medical examination.

Written by kerryunderwood

August 18, 2020 at 8:25 am

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FIRST-TIER TRIBUNAL: TAX CHAMBER: COSTS AGAINST HMRC FOR LYING

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In

First Choice Recruitment Ltd v HMRC [2019] UKFTT 412 (TC)

the First-Tier Tribunal unusually awarded costs against HMRC for unreasonable conduct under Rule 10(1)(b) of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009.

The appeal concerned the construction industry sub-contractors’ scheme.

Was the failure by the appellant to deduct tax from payments due to an error made in good faith?

HMRC’s statement of case made allegations of fraud, and in particular that the directors of the Appellant were knowing participants in the fraud, and that emails between various named individuals suggested that the Appellant was aware that there was fraud taking place.

The documents subsequently exchanged between the parties did not include any such emails, and the only emails included within HMRC’s evidence confirmed that the Appellant was not aware of the status of the payee.

The appeal was set down for hearing on 20 August 2018.

On 16 August 2018, HMRC withdrew from the Appeal.

The Tribunal held that HMRC’s conduct in alleging fraud in their Statement of Case, and particularising that conduct by reference to non-existent emails, was egregious, and that it is unacceptable for a public authority to make allegations of fraud where they have no credible evidence upon which to make even a prime facie case.

The Tribunal held that the conduct of HMRC was such as to justify the award of costs against them.

The Tribunal noted the requirements of the SRA’s Code of Conduct, and that if this dispute were conducted by a solicitor, there would have been issues of serious professional misconduct.

The Tribunal found that it was particularly concerning that HMRC had submitted that their conduct was entirely reasonable – and that impliedly they would not do anything differently in future.

Written by kerryunderwood

August 17, 2020 at 12:23 pm

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IMMIGRATION AND ASYLUM: KEY CASES IN LAST YEAR: PART 7: CHILDREN

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In this sub-series, running to 7 posts, I look at the key decisions in the last year in the Immigration and Asylum Chamber, all taken from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Immigration and Asylum: Children

CaseSubjectCommentary
Imran (Section 117C(5); children, unduly harsh) [2020] UKUT 83 (IAC), 11 February 2020ChildrenTo bring a case within Exception 2 in s.117C(5) of the Nationality, Immigration and Asylum Act 2002, the ‘unduly harsh’ test will not be satisfied, in a case where a child has two parents, by either or both of the following, without more: (i) evidence of the particular importance of one parent in the lives of the children; and (ii) evidence of the emotional dependence of the children on that parent and of the emotional harm that would be likely to flow from separation. Consideration as to what constitutes ‘without more’ is a fact sensitive assessment.

Patel (British citizen child – deportation) [2020] UKUT 45 (IAC), 29 January 2020ChildrenIn its application to a “qualifying child” within the meaning of section 117D of the Nationality, Immigration and Asylum Act 2002, section 117C (5) imposes the same two requirements as are specified in paragraph 399(a)(ii) of the Immigration Rules; namely, that it would be unduly harsh for the child to leave the United Kingdom and for the child to remain. In both section 117C (5) and paragraph 399(a)(ii), what judicial decision-makers are being required to assess is a hypothetical question – whether going or staying ‘would’ be unduly harsh. They are not being asked to undertake a predictive factual analysis as to whether such a child would in fact go or stay.

SD (British citizen children – entry clearance) Sri Lanka [2020] UKUT 43 (IAC), 23 January 2020ChildrenBritish citizenship is a relevant factor when assessing the best interests of the child. British citizenship includes the opportunities for children to live in the UK, receive free education, have full access to healthcare and welfare provision and participate in the life of their local community as they grow up. There is no equivalent to s.117B (6) of the Nationality, Immigration and Asylum Act 2002 in any provision of law or policy relating to entry clearance applicants. In assessing whether refusal to grant a parent entry clearance to join a partner has unjustifiably harsh consequences, the fact that such a parent has a child living with him or her who has British citizenship is a relevant factor. However, the weight to be accorded to such a factor will depend heavily on the particular circumstances and is not necessarily a powerful factor.

Written by kerryunderwood

August 17, 2020 at 12:12 pm

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IMMIGRATION AND ASYLUM: KEY CASES IN LAST YEAR: PART 6: EUROPEAN UNION

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In this sub-series, running to 7 posts, I look at the key decisions in the last year in the Immigration and Asylum Chamber, all taken from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Immigration and Asylum: European Union

CaseSubjectCommentary
Banger (EEA: EFM – Right of Appeal) [2019] UKUT 00194 (IAC), 10 April 2019  European UnionThe Immigration (European Economic Area) Regulations 2016 (‘the 2016 Regs’) specifically excluded a right of appeal for Extended Family Members (‘EFMs’). The 2016 Regs have been amended pursuant to the Immigration (European Economic Area Nationals) (EU Exit) Regulations 2019, with effect from 29 March 2019, so as to provide EFMs with a right of appeal. This does not have retrospective effect. It is open to those EFMs against whom a decision was made under the 2016 Regs but before 29 March 2019 to request a new decision from the Secretary of State in order to generate a right of appeal.

Rehman (EEA Regulations 2016 – specified evidence) [2019] UKUT 195 (IAC), 10 April 2019European UnionThe principles outlined in Barnett and Others (EEA Regulations; rights and documentation) [2012] UKUT 142 are equally applicable to The Immigration (European Economic Area) Regulations 2016. Section 1 of Schedule 2 to these regulations provides that the sole ground of appeal is that the decision breaches the appellant’s rights under the EU Treaties in respect of entry to or residence in the United Kingdom. The provisions contained in regulations 21 and 42 must be interpreted in the light of European Union law. In some cases, this might involve ignoring the requirement for specified evidence altogether if a document is not in fact required to establish a right of residence.

ZA (Reg 9. EEA Regs; abuse of rights) Afghanistan [2019] UKUT 281 (IAC), 31 July 2019European UnionThe requirement to have transferred the centre of one’s life to the host member state is not a requirement of EU law, nor is it endorsed by the CJEU. Where an EU national of one state (“the home member state”) has exercised the right of freedom of movement to take up work or self-employment in another EU state (“the host state”), his or her family members have a derivative right to enter the member state if the exercise of Treaty rights in the host state was “genuine” in the sense that it was real, substantive, or effective. It is for an appellant to show that there had been a genuine exercise of Treaty rights. The question of whether family life was established and/or strengthened, and whether there has been a genuine exercise of Treaty rights requires a qualitative assessment which will be fact-specific. If it is alleged that the stay in the host member state was such that reg. 9 (4) applies, the burden is on the Secretary of State to show that there was an abuse of rights.

Written by kerryunderwood

August 17, 2020 at 12:06 pm

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IMMIGRATION AND ASYLUM: KEY CASES IN LAST YEAR: PART 5: COUNTRY GUIDANCE

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In this sub-series, running to 7 posts, I look at the key decisions in the last year in the Immigration and Asylum Chamber, all taken from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Immigration and Asylum: Country Guidance

CaseSubjectCommentary
BF (Tirana – gay men) Albania CG [2019] UKUT 0093 (IAC), 26 March 2019Country GuidanceParticular care must be exercised when assessing the risk of violence and the lack of sufficiency of protection for openly gay men whose home area is outside Tirana, given the evidence of openly gay men from outside Tirana encountering violence as a result of their sexuality. Such cases will turn on the particular evidence presented. Turning to the position in Tirana, in general, an openly gay man, by virtue of that fact alone, would not have an objectively well-founded fear of serious harm or persecution on return to Tirana.

PS (Christianity – risk) Iran CG [2020] UKUT 46 (IAC), 20 February 2020Country GuidanceThis country guidance applies to protection claims from Iranians who claim to have converted from Islam to Christianity. Insofar as they relate to non-ethnic Christians, this decision replaces the country guidance decisions in FS and Others (Iran – Christian Converts) Iran CG [2004] UKIAT 00303 and SZ and JM (Christians – FS confirmed) Iran CG [2008] UKAIT 00082 which are no longer to be followed. Decision makers should begin by determining whether the claimant has demonstrated that it is reasonably likely that he or she is a Christian. If that burden is discharged further specified considerations apply. In cases where the claimant is found to be insincere in his or her claimed conversion, there is not a real risk of persecution ‘in-country’. There being no reason for such an individual to associate himself with Christians, there is not a real risk that he would come to the adverse attention of the Iranian authorities. Decision-makers must nevertheless consider the possible risks arising at the ‘pinch point’ of arrival.

SMO, KSP & IM (Article 15(c); identity documents) Iraq CG [2019] UKUT 400 (IAC), 20 December 2019Country GuidanceThis new Country Guidance determination on Iraq considers several issues including the risk of indiscriminate violence amounting to serious harm within the scope of Article 15(c) of the Qualification Directive; documentation and feasibility of return; civil status identity documentation; internal relocation within GOI-Controlled Iraq; and returns to the Iraqi Kurdish Region. This decision replaces all existing country guidance on Iraq.

Written by kerryunderwood

August 17, 2020 at 8:56 am

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IMMIGRATION AND ASYLUM: KEY CASES IN LAST YEAR: PART 4: DEPORTATION

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In this sub-series, running to 7 posts, I look at the key decisions in the last year in the Immigration and Asylum Chamber, all taken from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Immigration and Asylum: Deportation

CaseSubjectCommentary
MS (s.117C(6): “very compelling circumstances”) Philippines [2019] UKUT 00122 (IAC), 4 March 2019DeportationIn determining pursuant to section 117C(6) of the Nationality, Immigration and Asylum Act 2002 whether there are very compelling circumstances, over and above those described in Exceptions 1 and 2 in subsections (4) and (5), such as to outweigh the public interest in the deportation of a foreign criminal, a court or tribunal must take into account, together with any other relevant public interest considerations, the seriousness of the particular offence of which the foreign criminal was convicted; not merely whether the foreign criminal was or was not sentenced to imprisonment of more than 4 years.

RA (s.117C: “unduly harsh”; offence: seriousness) Iraq [2019] UKUT 00123 (IAC), 4 March 2019  DeportationIn KO (Nigeria) & Others v Secretary of State for the Home Department [2018] UKSC 53, the approval by the Supreme Court of the test of “unduly harsh” in section 117C(5) of the Nationality, Immigration and Asylum Act 2002, formulated by the Upper Tribunal in MK (Sierra Leone) v Secretary of State for the Home Department [2015] UKUT 223 (IAC), does not mean that the test includes the way in which the Upper Tribunal applied its formulation to the facts of the case before it. The way in which a court or tribunal should approach section 117C remains as set out in the judgment of Jackson LJ in NA (Pakistan) & Another v Secretary of State [2016] EWCA Civ 662. Determining the seriousness of the particular offence will normally be by reference to the length of sentence imposed and what the sentencing judge had to say about seriousness and mitigation; but the ultimate decision is for the court or tribunal deciding the deportation case.

Written by kerryunderwood

August 17, 2020 at 8:39 am

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IMMIGRATION AND ASYLUM: KEY CASES IN LAST YEAR: PART 3: EVIDENCE

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In this sub-series, running to 7 posts, I look at the key decisions in the last year in the Immigration and Asylum Chamber, all taken from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Immigration and Asylum: Evidence

CaseSubjectCommentary
Rana (s. 85A; Educational Loans Scheme) [2019] UKUT 00396 (IAC), 15 November 2019  EvidenceThere was nothing in s 85A of the 2002 Act preventing the Secretary of State from adducing evidence. The requirement to show that a loan was “part of an Academic or Educational Loan Scheme” for the purposes of paragraph 1B(d)(7) of Appendix C is not met merely by showing that the loan was for educational purposes. Such a scheme will have some element of government or official involvement, will be of advantage to students in comparison with ordinary commercial loans, and will be concerned with the loans as a group as well as individually.
 
SB (vulnerable adult: credibility) Ghana [2019] UKUT 00398 (IAC), 22 November 2019EvidenceThe fact that a judicial fact-finder decides to treat an appellant or witness as a vulnerable adult does not mean that any adverse credibility finding in respect of that person is thereby to be regarded as inherently problematic and thus open to challenge on appeal. By applying the Joint Presidential Guidance Note No 2 of 2010, two aims are achieved. First, the judicial fact-finder will ensure the best practicable conditions for the person concerned to give their evidence. Secondly, the vulnerability will also be taken into account when assessing the credibility of that evidence. The Guidance makes it plain that it is for the judicial fact-finder to determine the relationship between the vulnerability and the evidence that is adduced.

Written by kerryunderwood

August 14, 2020 at 4:00 pm

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IMMIGRATION AND ASYLUM: KEY CASES IN LAST YEAR: PART 2: PRACTICE AND PROCEDURE

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In this sub-series, running to 7 posts, I look at the key decisions in the last year in the Immigration and Asylum Chamber, all taken from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Immigration and Asylum: Practice and Procedure

CaseSubjectCommentary
Abbasi (rule 43; para 322(5): accountants’ evidence) [2020] UKUT 27 (IAC), 8 January 2020Practice and ProcedureThe Upper Tribunal can apply rule 43 of the Tribunal Procedure (Upper Tribunal) Rules 2008 of its own motion. The use of fraud before the Upper Tribunal constitutes an abuse of process such as to amount to a “procedural irregularity” for the purposes of rule 43(2)(d). In a case involving a decision under paragraph 322(5) of the immigration rules, where an individual relies upon an accountant’s letter admitting fault in the submission of incorrect tax returns to Her Majesty’s Revenue and Customs, the First-tier or Upper Tribunal is unlikely to place any material weight on that letter if the accountant does not attend the hearing to give evidence, by reference to a Statement of Truth, that explains in detail the circumstances in which the error came to be made; the basis and nature of any compensation; and whether the firm’s insurers and/or any relevant regulatory body have been informed. This is particularly so where the letter is clearly perfunctory in nature.

Ahmed (rule 17; PTA; Family Court materials) [2019] UKUT 357 (IAC), 16 October 2019Practice and Procedure  Where P is the respondent to the Secretary of State’s appeal in the Upper Tribunal against the decision of the First-tier Tribunal to allow P’s appeal, P cannot give notice under rule 17 of the Tribunal Procedure (Upper Tribunal) Rules 2008 so as to withdraw his appeal, since P has no appeal in the Upper Tribunal. In such a situation, the giving of notice under rule 17 to withdraw P’s case will, if the Upper Tribunal gives consent, have the effect of leaving the Secretary of State’s appeal to the Upper Tribunal unopposed and therefore may well lead to a reasoned decision from the Upper Tribunal, setting aside the decision of the First-tier Tribunal.

Anwar (rule 17(1): withdrawal of appeal) [2019] UKUT 00125 (IAC), 5 March 2019Practice and ProcedureUnder rule 17(1) of the Tribunal Procedure (First-tier Tribunal) (Immigration and Asylum Chamber) Rules 2014, the decision whether to withdraw an appeal is for the appellant. That decision does not require judicial approval, in order for it to be effective. If an issue arises as to whether a withdrawal was, in fact, the appellant’s decision (i.e. whether it was valid), it is for a judge of the First-tier Tribunal to decide it; as to which, the reasons for withdrawal may assist. If an issue arises as to whether or not an appellant’s notice of withdrawal was legally valid, the Tribunal should exercise its case management powers so as to decide the matter. If the judge’s decision is a substantive decision, as opposed to a “procedure, ancillary or preliminary decision” within the meaning of article 3(n) of the Appeals (Excluded Decisions) Order 2009, the decision will be appealable to the Upper Tribunal.

Aziz (NIAA 2002 s 104(4A): abandonment) [2020] UKUT 84 (IAC), 14 February 2020Practice and ProcedureWhere a person brings an appeal under section 82(1) of the Nationality, Immigration and Asylum Act 2002 and is then given leave to remain in the United Kingdom, the effect of section 104(4A) is to cause the appeal to be treated as abandoned (subject to section 104(4B)), whether or not the appeal was pending on the date of the grant of leave.

Bano (procedural fairness, withdrawal of representatives) [2019] UKUT 416 (IAC), 25 September 2019Practice and ProcedureFairness means fairness to both sides: it does not mean favouring the appellant at the expense of the respondent. Tribunals must ensure appellants have a fair hearing, but they should not be intimidated by unjustified withdrawal of representatives. Unless unfairness has resulted in there being no proper consideration of their case at all, appellants who allege procedural unfairness may find it difficult to have a decision set aside, without showing that they may have suffered prejudice through inability to present a better case.  

Bhavsar (late application for PTA: procedure) [2019] UKUT 00196 (IAC), 12 April 2019Practice and ProcedureThere is nothing in the Tribunal Procedure (First-tier Tribunal) (Immigration and Asylum Chamber) Rules 2014 that prevents the First-tier Tribunal from refusing to admit an application for permission to appeal to the Upper Tribunal, where the application is made outside the relevant time limit and the First-tier Tribunal does not extend time. The appropriate course, in the case of such an application, is for the First-tier Tribunal to refuse to admit it. This will mean that any subsequent application to the Upper Tribunal in the case for permission to appeal to that Tribunal will be subject to rule 21(7) of the Tribunal Procedure (Upper Tribunal) Rules 2008, whereby the Upper Tribunal must only admit the application made to it (whether or not that application was in time) if the Upper Tribunal considers it is in the interests of justice for it to do so.

Birch (Precariousness and mistake; new matters) [2020] UKUT 86 (IAC), 26 February 2020Practice and ProcedureThe observations about a person’s misapprehension, found in paragraph [53] of Agyarko are, despite their context in a discussion of precariousness, capable of being applicable also to a person who has no leave. The prohibition on considering new matters in s 85 of the 2002 Act does not apply to proceedings in the Upper Tribunal.

CJ (international video-link hearing: data protection) Jamaica [2019] UKUT 00126(IAC), 12 March 2019Practice and ProcedureThe arrangements made to enable the appellant to give evidence in his human rights appeal by video link between the British High Commission in Kingston, Jamaica and the Tribunal’s hearing centre in the United Kingdom did not involve the transfer of data to a third country, for the purposes of the General Data Protection Regulation ((EU) 2016/679). Even if that were not the case, the transfer was lawful under the derogation in Article 49(1)(e) of the Regulation (transfer necessary for establishment, exercise or defence of legal claims).

Das (paragraph 276B – s3C – application validity) [2019] UKUT 354 (IAC), 8 October 2019Practice and ProcedureThe validity of an application for leave to remain is to be determined with reference to the law in force at the time that it is made or purportedly made. An application which was invalid according to the law in force at the relevant time cannot be rendered valid by a subsequent change in the law. There must be adherence to proper standards of appellate advocacy in the Upper Tribunal. In the absence of a formal and timeous application to vary the grounds, professional advocates must expect to be confined to the grounds upon which permission was granted. When permission to appeal to the Upper Tribunal is granted following a successful application to the Administrative Court under CPR 54.7A (‘a Cart JR’), permission is granted by reference to the grounds to the Upper Tribunal.

Durueke (PTA: AZ applied, proper approach) [2019] UKUT 197 (IAC), 7 June 2019Practice and ProcedureIn reaching a decision whether to grant permission to appeal to the Upper Tribunal on a point that has not been raised by the parties but which a judge considering such an application for permission considers is arguably a Robinson obvious point or other point falling within para 3 of the head-note in AZ (error of law: jurisdiction; PTA practice) Iran [2018] UKUT 00245 (IAC), the evidence necessary to establish the point in question must be apparent from the grounds of appeal to the Upper Tribunal (whether or not the appellant is represented at the time) and/or the decision of the judge who decided the appeal and/ or the documents on file. The permission judge should not make any assumptions that such evidence was before the judge who decided the appeal. Furthermore, if permission is granted on a ground that has not been raised by the parties, it is good practice and a useful aid in the exercise of self-restraint for the permission judge to indicate which aspect of head-note 3 of AZ applies.

Ejiogu (Cart cases) [2019] UKUT 00395 (IAC), 13 November 2019Practice and ProcedureAn addition to the grounds of appeal requires the permission of the Upper Tribunal. That is so even if the case has been granted permission following a Cart Judicial Review under CPR 54.7A. In deciding whether to grant permission to rely upon additional grounds, the Tribunal will follow the same procedure as in relation to any other procedural default, in particular considering the length of the delay (beginning with the date on which time for appeal to the Upper Tribunal expired).

Isufaj (PTA decisions/ reasons; EEA reg. 37 appeals) [2019] UKUT 00283 (IAC), 12 August 2019Practice and ProcedureJudges deciding applications for permission to appeal should ensure that, as a general matter, there is no apparent contradiction between the decision on the application and what is said in the “reasons for decision” section of the document that records the decision and the reasons for it. As was said in Safi and others (permission to appeal decisions) [2018] UKUT 388 (IAC), a decision on a permission application must be capable of being understood by the Tribunal’s administrative staff, the parties and by the court or tribunal to which the appeal lies. In the event of such an apparent contradiction or other uncertainty, the parties can expect the Upper Tribunal to treat the decision as the crucial element.

MA (Cart JR: effect on UT processes) Pakistan [2019] UKUT 353 (IAC), 3 October 2019Practice and ProcedureWhere the decision of the Upper Tribunal to refuse permission to appeal against the decision of the First-tier Tribunal is quashed by the High Court, following the grant of permission in a “Cart” judicial review under CPR 54.7A, the Upper Tribunal’s ability to grant permission to appeal without a hearing depends upon the Upper Tribunal being able to understand, from the High Court’s grant of permission in the judicial review, what led the Court to conclude that the requirements of CPR 54.7A(7) were satisfied. If the Upper Tribunal lists an application for permission to appeal for an oral hearing, following the quashing of a refusal to grant such permission, the appellant will need to ensure that the Upper Tribunal and the respondent have all the relevant materials in connection with the “Cart” judicial review, which may bear on the issue of whether permission to appeal should now be granted.

MS (British citizenship; EEA appeals) Belgium [2019] UKUT 356 (IAC), 15 October 2019Practice and ProcedureIf, on appeal, an issue arises as to whether the removal of a person (P) from the United Kingdom would be unlawful because P is a British citizen, the tribunal deciding the appeal must make a finding on P’s citizenship. The fact that P might, in the past, have had a good case to be registered as a British citizen has no material bearing on the striking of the proportionality balance under Article 8(2) of the ECHR. The key factor is not whether P had a good chance of becoming a British citizen, on application, at some previous time but is, rather, the nature and extent of P’s life in the United Kingdom.

Niaz (NIAA 2002 s. 104: pending appeal) [2019] UKUT 00399 (IAC), 25 November 2019Practice and ProcedureSection 104(2) of the Nationality, Immigration and Asylum Act 2002 contains an exhaustive list of the circumstances in which an appeal under section 82(1) is not finally determined. Although section 104(2) is describing situations in which an appeal is not to be regarded as finally determined, the corollary is that, where none of the situations described in sub-paragraphs (a) to (c) apply (and the appeal has not lapsed or been withdrawn or abandoned), the appeal in question must be treated as having been finally determined. An appeal which has ceased to be pending within the meaning of section 104 becomes pending again if the Upper Tribunal’s decision refusing permission to appeal from the First-tier Tribunal is quashed on judicial review.

Nimo (appeals: duty of disclosure) [2020] UKUT 88 (IAC), 27 February 2020Practice and ProcedureIn an immigration appeal, the Secretary of State’s duty of disclosure is not knowingly to mislead: CM (EM country guidance; disclosure) Zimbabwe CG [2013] UKUT 0059, citing R v SSHD ex parte Kerrouche No 1 [1997] Imm AR 610.The Upper Tribunal was wrong to hold in Miah (interviewer’s comments; disclosure; fairness) [2014] UKUT 515 that, in every appeal involving an alleged marriage of convenience, the interviewer’s comments in the Secretary of State’s form ICD.4605 must be disclosed to the appellant and the Tribunal. No such general requirement is imposed by the respondent’s duty of disclosure or by rule 24 of the Tribunal Procedure (First-tier Tribunal) (Immigrationand Asylum Chamber) Rules 2014.

OK (PTA; alternative findings) Ukraine [2020] UKUT 44 (IAC), 27 January 2020Practice and ProcedurePermission should not be granted on the grounds as pleaded if there is, quite apart from the grounds, a reason why the appeal would fail.

R (on the application of Bajracharya) v Secretary of State for the Home Department (para. 34 – variation – validity) [2019] UKUT 417 (IAC), 20 November 2019Practice and ProcedureParagraph 34 [A-F] of the Immigration Rules is to be construed by the application of the ordinary principles of statutory construction, which start from the natural meaning of the words in their context. Paragraph 34 requires applicants to make an application for leave to remain in accordance with the provisions of 34. If a second application is submitted when the first application is outstanding, the second application will be treated as a variation of the first application [34BB(2)]. If the variation does not comply with the requirements in paragraph 34 “the variation will be invalid and will not be considered” (paragraph 34E). Invalidity does not extend to the original application.

R (on the application of Ellis) v Secretary of State for the Home Department (discretionary leave policy; supplementary reasons) [2020] UKUT 82 (IAC), 5 February 2020Practice and ProcedureExtra-statutory immigration policies should be interpreted in accordance with the objective meaning that a reasonable and literate person would ascribe to them. The Home Office discretionary leave policy should not be read as saying that, once it is decided that an individual continues to qualify for further leave on the same basis as before, he must automatically be granted indefinite leave to remain after 6 years’ continuous discretionary leave unless at the date of decision he falls within the restricted leave policy. The word ‘normally’ is used advisedly, so as to maintain the maximum possible discretion. Where a policy governs what is to happen in the normal case, it remains open to the decision-maker to take a different course in a particular case, provided he or she takes account of the policy and has reason for considering the case to be abnormal.


R (on the application of Hoxha and Others) v Secretary of State for the Home Department (representatives: professional duties) [2019] UKUT 00124 (IAC), 4 March 2019                 Practice and ProcedureOffice of the Immigration Services Commissioner (OISC) organisations are only able to carry out judicial review case management with counsel authorised to conduct litigation if the organisations are both level 3 registered and have special authorisation to do this work. It is a commonplace of working in the difficult area of immigration and asylum judicial review, that practitioners are faced with clients who are distressed at the prospect of being removed from the United Kingdom. This does not absolve such a professional from the need to stand firm and act only as authorised by the statutory scheme. Where a medical expert report is relied upon by a legal representative, the representative has a duty to check the report for accuracy. Failure to carry out properly professional duties may result in the Upper Tribunal referring the legal representative/ organisation to the relevant regulatory body.

R (on the application of MW) v Secretary of State for the Home Department (Fast track appeal: Devaseelan guidelines) [2019] UKUT 411 (IAC), 16 December 2019Practice and ProcedureThe fact that an appeal was decided pursuant to the Asylum and Immigration Tribunal (Fast Track Procedure) Rules 2005 does not mean that the weight to be attached to the decision necessarily falls to be materially reduced, when applying the Guidelines in Devaseelan v Secretary of State for the Home Department [2002] UKAIT 702. Under those Guidelines, the first judicial decision is “the starting point” for the subsequent judicial fact-finder. The “starting point” principle is not a legal straitjacket. It permits subsequent judicial fact-finders to depart from the earlier judicial decision on a principled and properly- reasoned basis.

R (on the application of Sutharsan) v Secretary of State for the Home Department (UT rule 29(1): time limit) [2019] UKUT 217 (IAC), 1 July 2019Practice and ProcedureThe 21-day time limit in rule 29(1) of the Tribunal Procedure (Upper Tribunal) Rules 2008 for filing an acknowledgment of service in immigration judicial review proceedings begins to run on the day after the person concerned is provided with a copy of the application for judicial review, not on the day it was sent. A copy that is sent by post will be deemed to have been provided on the second business day after it was posted, unless the contrary is proved.

Smith (appealable decisions; PTA requirements; anonymity) [2019] UKUT 216 (IAC), 28 June 2019Practice and ProcedureA decision by the First-tier Tribunal not to decide a ground of appeal constitutes a “decision” for the purposes of s.11(1) of the Tribunals, Courts and Enforcement Act 2007. It may therefore be appealed to the Upper Tribunal. If an appellant’s appeal before the First-tier Tribunal succeeds on some grounds and fails on other grounds, the appellant will not be required to apply for permission to appeal to the Upper Tribunal in respect of any ground on which he or she failed, so long as a determination of that ground in the appellant’s favour would not have conferred on the appellant any material (ie tangible) benefit, compared with the benefit flowing from the ground or grounds on which the appellant was successful in the First-tier Tribunal.

TS (interpreters) Eritrea [2019] UKUT 352 (IAC), 4 September 2019Practice and ProcedureAn appellate tribunal will usually be slow to overturn a judge’s decision on the basis of alleged errors in, or other problems with, interpretation at the hearing before that judge (Perera v Secretary of State for the Home Department [2004] EWCA Civ 1002). Weight will be given to the judge’s own assessment of whether the interpreter and the appellant or witness understood each other. Where an issue regarding interpretation arises at the hearing, the matter should be raised with the judge at the hearing so that it can be addressed there and then. Even if the representatives do not do so, the judge should act on his or her own initiative, if satisfied that an issue concerning interpretation needs to be addressed.

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August 14, 2020 at 3:15 pm

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IMMIGRATION AND ASYLUM: KEY CASES IN LAST YEAR: PART 1: GENERAL

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Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In this sub-series, running to 7 posts, I look at the key decisions in the last year in the Immigration and Asylum Chamber, all taken from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

Immigration and Asylum Generally

CaseSubjectCommentary
AAR & AA (Non-Arab Darfuris – return) Sudan [2019] UKUT 282 (IAC), 7 August 2019Immigration and Asylum generallyThe situation in Sudan remains volatile after civil protests started in late 2018 and the future is unpredictable. There is insufficient evidence currently available to show that the guidance given in AA (non-Arab Darfuris – relocation) Sudan CG [2009] UKAIT 56 and MM (Darfuris) Sudan CG [2015] UKUT 10 (IAC) requires revision. Those cases should still be followed.

AXB (Art 3 health: obligations; suicide) Jamaica [2019] UKUT 00397 (IAC), 18 November 2019Immigration and Asylum generallyIn a case where some individual asserts that his removal from the Returning State would violate his Article 3 European Convention on Human Rights (ECHR) rights because of the consequences to his health, the obligation on the authorities of a Returning State dealing with a health case is primarily one of examining the fears of an applicant as to what will occur following return and assessing the evidence. In order to fulfil its obligations, a Returning State must provide “appropriate procedures” to allow that examination and assessment to be carried out. In the UK, that is met in the first place by an examination of the case by the Secretary of State and then by an examination on appeal by the Tribunal and an assessment of the evidence before it.

Buci (Part 5A: “partner”) [2020] UKUT 87 (IAC), 27 February 2020Immigration and Asylum generally  The word “partner” is not defined in Part 5A of the Nationality, Immigration and Asylum Act 2002. The definition of “partner” in GEN 1.2 of Appendix FM to the Immigration Rules does not govern the way in which “partner” is to be interpreted in Part 5A. A person who satisfies the definition in GEN 1.2 should, as a general matter, be regarded as being a partner for the purposes of Part 5A, Where, however, a person does not fall within that definition, the judge will need to undertake a broad evaluative assessment of the relationship.

DC (trafficking: protection/ human rights appeals) Albania [2019] UKUT 351 (IAC), 3 September 2019Immigration and Asylum generally  In a protection appeal, which concerns alleged trafficking within the scope of the Council of Europe Convention on Action against Trafficking in Human Beings the “reasonable grounds” or “conclusive grounds” decision of the Competent Authority (CA) will be part of the evidence that the tribunal will have to assess in reaching its decision on that appeal, giving the CA’s decision, such weight as is due, bearing in mind that the standard of proof applied by the CA in a “conclusive grounds” decision was the balance of probabilities.

De Souza (Good Friday Agreement: nationality) [2019] UKUT 355 (IAC), 14 October 2019Immigration and Asylum generallyThe Belfast (or Good Friday) Agreement did not amend the law of British citizenship, as contained in the British Nationality Act 1981.

KF and others (entry clearance, relatives of refugees) Syria [2019] UKUT 413 (IAC), 11 December 2019Immigration and Asylum generallyIn applications for entry clearance, the starting and significant point is the Article 8 rights of the sponsor or others in the UK. A fact sensitive analysis is essential. There is no blanket prohibition on the relatives of refugees other than a spouse and/or child. As was made clear in Agyarko [2017] UKSC 11 the purpose of the Immigration Rules is to enable decision makers to understand and apply the appropriate weight to be given to the public interest. That the appellants in an application for entry clearance do not meet the Immigration Rules is an adverse factor. It is Mathieson v Secretary of State for Work and Pensions [2011] UKSC 4 rather than AT and AHI v Entry Clearance Officer Abu Dhabi [2016] UKUT 227 (IAC) which should guide the Tribunal in relation to the role of international treaties which have not been incorporated into domestic law.

MB (Internal relocation – burden of proof) Albania [2019] UKUT 392 (IAC), 30 July 2019Immigration and Asylum generallyThe burden of proof remains on the appellant, where the respondent has identified the location to which it is asserted they could relocate, to prove why that location would be unduly harsh, in line with AMM and others (conflict; humanitarian crisis; returnees; FGM) Somalia CG [2011] UKUT 445 (IAC), but within that burden, the evaluation exercise should be holistic. A holistic approach to such an assessment is consistent with the balance-sheet approach endorsed later in SSHD v SC (Jamaica) [2017] EWCA Civ 2112, at paragraphs [40] and [41].

R (on the application of JW and Others) v Secretary of State for the Home Department (Tier 1 Investor; control; investments) [2019] UKUT 00393 (IAC), 21 October 2019Immigration and Asylum generallyThe meaning of ‘control’ in paragraph 245ED(e) and in Appendix A (specifically in Table 8B and 9B) of the Immigration Rules is to be interpreted in accordance with its natural and ordinary meaning, namely that a person has the authority to manage and/or direct the use of the money, asset or investment (depending on the context). It includes not just a question of legal or beneficial ownership but includes an element of choice of use. The money must be under a person’s control at the point of investment.

R (on the application of MBT) v Secretary of State for the Home Department (restricted leave; ILR; disability discrimination) [2019] UKUT 414 (IAC), 16 December 2019Immigration and Asylum generallyA decision of the Secretary of State not to grant indefinite leave to remain to a person subject to the restricted leave policy (“the RL policy”) does not normally engage Article 8 of the European Convention on Human Rights. However, Article 8 may be engaged by a decision to refuse to grant indefinite leave to remain where, for example, the poor state of an individual’s mental and physical health is such that regular, repeated grants of restricted leave are capable of having a distinct and acute impact on the health of the individual concerned. Once Article 8 is engaged by a decision to refuse indefinite leave to remain under the RL policy, the import of Article 8 will be inherently fact-specific. The views of the Secretary of State attract weight, given her institutional competence on matters relating to the public interest and the United Kingdom’s reputation as a guardian of the international rule of law.

R (on the application of Mujahid) v First-tier Tribunal (Immigration and Asylum Chamber) and the Secretary of State for the Home Department (refusal of human rights claim) [2020] UKUT 85 (IAC), 25 February 2020Immigration and Asylum generallyA person (C) in the United Kingdom who makes a human rights claim is asserting that C (or someone connected with C) has, for whatever reason, a right recognised by the European Convention on Human Rights (ECHR), which is of such a kind that removing C from, or requiring C to leave, would be a violation of that right. The refusal of a human rights claim under section 82(1)(b) of the Nationality, Immigration and Asylum Act 2002 involves the Secretary of State taking the stance that she is not obliged by section 6 of the Human Rights Act 1998 to respond to the claim by granting C leave. Accordingly, the Secretary of State does not decide to refuse a human rights claim when, in response to it, she grants C limited leave by reference to C’s family life with a particular family member, even though C had sought indefinite leave by reference to long residence in the United Kingdom.

SB (refugee revocation; IDP camps) Somalia [2019] UKUT 358 (IAC), 1 November 2019Immigration and Asylum generally
In Secretary of State for the Home Department v MS (Somalia) [2019] EWCA Civ 1345, the Court of Appeal has authoritatively decided that refugee status can be revoked on the basis that the refugee now has the ability to relocate internally within the country of their nationality or former habitual residence. The conclusion of the Court of Appeal in Secretary of State for the Home Department v Said [2016] EWCA Civ 442 was that the country guidance in MOJ & Ors (Return to Mogadishu) Somalia CG [2014] UKUT 00442 (IAC) did not include any finding that a person who finds themselves in an IDP camp is thereby likely to face Article 3 ECHR harm (having regard to the high threshold established by D v United Kingdom (1997) 24 EHRR 43 and N v United Kingdom (2008) 47 EHRR 39). There is nothing in the country guidance in AA and Others (conflict; humanitarian crisis; returnees; FGM) Somalia [2011] UKUT 00445 (IAC) that requires a different view to be taken of the position of such a person. It will be an error of law for a judge to refuse to follow the Court of Appeal’s conclusion on this issue.
Sahebi (Para 352(iii): meaning of “existed”) [2019] UKUT 00394 (IAC), 12 November 2019Immigration and Asylum generally
On its true construction, para 352A(iii) of the Immigration Rules is satisfied by showing nothing more than the formal existence of a marriage or civil partnership as at the time of the refugee’s departure from his/her country of former habitual residence. In contrast to less formal relationships, there is no requirement to show that the relationship had the qualitative character of it having subsisted at the time of the refugee’s departure.
MSU (S.104(4b) notices) Bangladesh [2019] UKUT 412 (IAC), 20 December 2019Immigration and Asylum generally
Where section 104(4A) applies to an appeal, neither the First-tier Tribunal nor the Upper Tribunal has any jurisdiction unless and until a notice is given in accordance with section 104(4B). If such a notice is given, it has the effect of retrospectively causing the appeal to have been pending throughout, and validating any act by either Tribunal that was done without jurisdiction for the reason in (1) above. As the matter stands at present, there are no ‘relevant practice directions’ governing the section 104(4B) notice in either Tribunal. The Upper Tribunal has power to extend time for a section 104(4B) notice. Despite the provisions of Upper Tribunal rule 17A (4), such a power can be derived from s.25 of the Tribunals, Courts and Enforcement Act 2007.

Written by kerryunderwood

August 14, 2020 at 1:14 pm

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EMPLOYMENT APPEAL TRIBUNAL : SIX IMPORTANT DECISIONS

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Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In this, the second of a series of posts setting out brief summaries of key tribunal decisions in the last year, I set out 6 decisions of the Employment Appeal Tribunal.

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

 

Employment Appeal Tribunal

Citation Parties Jurisdiction Commentary
UKEAT/0304/18Richard Page v Lord Chancellor and Lord Chief Justice EATThe claimant was a magistrate who objected on religious grounds to children being adopted by same-sex couples and was ultimately removed from office following a BBC interview. Choudhury P and members upheld the employment tribunal’s rejection of his claims arising from his removal from office, in particular (a) rejecting his victimization claim because the statement to the BBC relied on did not involve any allegation of breach of the Equality Act 2010 by the Respondents or was not the cause of his removal and (b) rejecting his case under Art 10 of the European Convention on Human Rights because that Art was not engaged on the facts or because his removal from the magistracy was in any event a proportionate limitation on his to right to freedom of expression.

UKEAT/0247/18 [2020] IRLR 4  Bessong v Pennine Care NHS Foundation Trust   EATSince the repeal of ss 40(2)(4) of the Equality Act 2010 by the Enterprise and Regulatory Reform Act 2013, there is no express provision in the 2010 Act to the effect that an employer’s failure to prevent racial harassment by third parties would itself amount to harassment under the 2010 Act unless the employer’s failure was itself related to the protected characteristic of race. Choudhury P decided that neither the Race Directive (2000/43/EC) nor the Charter of Fundamental Rights of the EU required a different interpretation of s 26(1) of the 2010 Act, which on its face requires the employer’s conduct (ie failure to prevent harassment) to be related to race.

UKEAT/0007/19                         Watson v Hemingway Design Ltd (in liquidation) and others EATKerr J decided that the employment tribunal had jurisdiction to determine a claim under the Third Parties (Rights against Insurers) Act 2010 against an insolvent employer’s insurer in a case where the underlying claims against the employer arose under the Employment Rights Act 1998 and the Equality Act 2010.

UKEAT/0236/18Sophia Walker v Wallem Shipmanagement Ltd EATKerr J and members decided that on its proper construction regulation 4 of the Equality Act (Work on Ships and Hovercraft) Regulations 2011 excluded a claim of sex discrimination under the Equality Act 2010 by a woman applying in UK to a recruitment agency operating here for work on a foreign registered vessel, notwithstanding that the agency admitted direct discrimination in refusing to consider a female applicant for the job. The Tribunal considered that it was doubtful that the regulation in question conforms to the Equal Treatment Directive and recommended that the Secretary of State revisit the scope of the Regulations.

UKEAT/0223/19Basfar v Wong EATSoole J decided that a Saudi diplomat was entitled to rely on the Diplomatic Privileges Act 1964 to resist a claim by a domestic servant claiming wrongful dismissal, failure to pay national minimum wage and breach of the Working Time Regulations 1998 in circumstances alleged to amount to modern slavery. Although the Court of Appeal’s decision in Reyes v Al-Maliki [2015] ICR 289 on the ambit of the “commercial activity” exclusion to the privilege was not binding authority because the Supreme Court’s had decided the case on other grounds [2017] ICR 1417, it was nevertheless highly persuasive and, combined with the observations of Lords Sumption and Neuberger in the Supreme Court, represented the true legal position.

UKEAT/0234/19HMRC v Middlesborough Football and Athletic Company (1986) Ltd EATHHJ Auerbach decided that reductions from certain employees’ weekly pay made by Middlesbrough football club in respect of season tickets provided to them counted as “deductions” in calculating their pay for the purposes of the National Minimum Wage Regulations 2015 and that the club was therefore in breach of the Regulations, and in particular that for the purposes of regulation 12, the reductions could not be classified as “payments” by the employees, were for the “use and benefit” of the club and were not made under a relevant contractual provision under regulation 12(2)(a).

Written by kerryunderwood

August 14, 2020 at 8:44 am

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CRIMINAL INJURIES COMPENSATION

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The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In this, the first of a series of posts setting out brief summaries of key tribunal decisions in the last year I set out 3 decisions of the Social Entitlement Chamber (Criminal Injuries Compensation).

All of the information in all of these posts is taken directly from the Senior President of Tribunals’ Annual Report 2020, which is an invaluable and free resource dealing with all aspect of the work of tribunals as well as setting out these summaries of key cases.

The whole report can be accessed here.

 

Social Entitlement Chamber (Criminal Injuries Compensation) 

CitationPartiesJurisdictionCommentary
[2019] UKUT 15 (AAC)R (CICA) v Ft TCriminal Injuries CompensationUTJ Rowland reviewed the authorities as to whether an injury is directly attributable for a crime of violence. The Tribunal also commented that whilst a tribunal was not bound to accept an expect medical report it may consider the evidence to be compelling in the absence of any other medical evidence, but it must still give reasons. It doubted that the tribunal was required to record a dissenting view.

[2019] CSOH 79Lord Advocate v F-t T (SEC)Criminal Injuries CompensationThe Outer House of the Court of Session decided that nasal bones were not part of the skull and accordingly as a matter of statutory interpretation a fracture to nasal bones was not a fracture of the skull. Giving judgement Lord Brailsford gave guidance on rule 2(2)(d) of the First-tier Tribunal (SEC) Procedure Rules 2008. The use of the special expertise of a tribunal member is intended to assist the tribunal in reaching a view on the evidence, including matters of technical difficulty or complexity within their expertise. It is not to provide evidence.

[2019] UKUT 322 (AAC)T D v Ft T and CICACriminal Injuries CompensationUTJ Markus QC quashed an interlocutory decision striking out the appellant’s appeal. The Judge highlighted errors in HMCTS administration and emphasised the importance of providing a complete and accurate appeal bundle. This error was compounded by misadvising the appellant about his right to apply for reinstatement.

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August 14, 2020 at 8:13 am

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SOME CIVIL AND FAMILY FEES REDUCED FROM 3 AUGUST 2020

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The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

HMCTS  has published updated Form EX50 (Civil and Family court fees leaflet) and the Ministry of Justice published updated Form EX50A (a full list of court fees in fees orders) to reflect revisions to the Family Proceedings Fees Order (SI 2008/1054) and the Civil Proceedings Fees Order (SI 2008/1053) made under the Court Fees (Miscellaneous Amendments) Order 2020 (SI 2020/720) (SI).

The forms reflect the following reductions in application fees for certain civil and family proceedings from 3 August.

For family proceedings, fees for the following applications have been reduced:

  • Third party debt orders or the appointment of a receiver (£100 to £77).
  • Charging orders (£100 to £38).
  • Judgment summons (£100 to £73).
  • Attachment of earnings orders (£100 to £34).

Reduced fees are also payable for the service of certain documents by bailiff, and on filing a request for detailed assessment of costs where the person filing the request is legally aided, funded by the Legal Services Commission, or a person for whom civil legal services have been made available under the Legal Aid, Sentencing and Punishment of Offenders Act 2012.

For civil proceedings, fees for the following applications have been reduced:

  • Witness summons (£50 to £21).
  • Variation of a judgment or suspension of enforcement (£50 to £14).
  • Certificate of satisfaction, or cancellation of a judgment debt (£15 to £14).

The Explanatory Memorandum to the SI explains that the Ministry of Justice carried out a review of civil and family fees for 2018/19 and mapped each fee to the cost of that particular service, using volume and cost data for that period.

The review identified that the fees for a number of court fees were set higher than the actual administrative cost of the service. The SI regularises the position by reducing the fees identified to the appropriate level.

The government has not launched a refund scheme in respect of the fees reduced by the SI, because it does not consider that there would be any negative impact on the groups who would typically pay these fees.

In response, the House of Lords Secondary Legislation Scrutiny Committee has recommended that further information about the decision not to launch a refund scheme should be sought, as well as ascertaining the number of people affected, and what the total cost would have been had a decision been made to refund those affected.

Written by kerryunderwood

August 13, 2020 at 12:55 pm

Posted in Uncategorized

NO LETTER BEFORE CLAIM: WRONGLY ISSUED AS PART 8: NO STRIKE OUT

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Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In

Halal Meat Sellers Committee Ltd & Anor v HMC (UK) Ltd [2020] EWHC 2190 (Comm)

the Commercial Court, part of the High Court, struck out the claim on the facts pursuant to CPR 3.4(2)(a) on the ground that the claimants’ Claim Form disclosed no reasonable grounds for bringing the claim.

What is interesting and significant about the case is the grounds on which the High Court refused to strike out the claim.

Here it was common ground that the claimants had failed to comply with the Civil Procedure Rules Pre-Action Protocol in that they had failed to issue a letter before action.

The claimant had also served a Part 8 Claim Form in circumstances where there were substantial issues of fact between the parties, and therefore the proceedings should have been issued under Part 7 and here the claimants had applied to have the proceedings transferred from Part 8 to Part 7.

CPR 3.4(2) empowers a court to strike out a statement of case, including a Claim Form if it appears to the court that:

 

(1) The statement of case discloses no reasonable grounds for bringing or defending the claim.

(2) The statement of case is an abuse of the Court’s process or is otherwise likely to obstruct the just disposal of the proceedings.

(3) There has been a failure to comply with a rule, practice direction or Court order.

 

In relation to the failure to issue a letter before action the High Court said that it would require “the most extreme circumstances” to warrant striking out a Claim Form for that reason:

 

“84. In my judgment, a failure to issue a letter before action should not be penalised by striking out the Claim Form. The absence of such a letter other than, perhaps, in the most extreme circumstances would not warrant such a drastic step. If the claim were clearly or arguably a meritorious one, such a step would be unduly disproportionate and any absence of a pre-action letter can be dealt with, if necessary, by other sanctions. If the claim were a plainly an unmeritorious claim, the claim itself would no doubt be exposed to striking out or summary judgment.”

 

In relation to issuing Part 8 proceedings instead of Part 7 proceedings the court had this to say:

 

“85. The second ground relied on by HMC that the Part 8 procedure was inappropriate again is not sufficient in my judgment to warrant striking out a claim, especially as in the present case the Claimants have applied to alter the Part 8 Claim Form to a Part 7 Claim Form.”

 

Comment

Quite right.

Such misconduct can be punished in costs.

In relation to Part 8 and Part 7, the Civil Procedure Rules themselves allow for a claim to be transferred from Part 8 to Part 7 and there can never be any justification for striking out a claim in such circumstances, where no one is prejudiced and the matter can simply be transferred to the right Part, again with costs consequences.

A refreshing decision taking an overall view and doing justice, rather than a nit-picking decision.

Written by kerryunderwood

August 12, 2020 at 12:47 pm

Posted in Uncategorized

NO COSTS FOR SOLICITOR ACTING FOR HIS OWN COMPANY: ANOTHER WRONG COSTS DECISION

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Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In

Financial Solutions (Euro) Ltd v The Financial Conduct Authority: [2020] UKUT 0243 (TCC)

the Tax and Chancery Chamber made an order in favour of the applicant and against the Financial Conduct Authority on the ground of its unreasonable decision making, and then went on to assess those costs.

The judge was dealing with a not uncommon situation where the client’s solicitor was the sole director of the applicant limited company.

Fairly obviously a solicitor who is the sole director of a limited company is likely to instruct her or his own firm.

It has been well established since the 19th century that a solicitor acting for herself or himself can claim costs as a solicitor for doing that work, for the very obvious reason that otherwise additional time and money would be spent on instructing outside solicitors – see

The London Scottish Benefit Society v Chorley, Crawford and Chester (1884) 13 QBD 872.

The Court of Appeal recently held that this principle holds good under the Civil Procedure Rules – see

Halborg v EMW Law LLP [2017] EWCA Civ 793 

where the Court of Appeal confirmed that a solicitor who acts for himself as a party to litigation can recover not only his out of pocket expenses, but also his profit costs, but he cannot recover for anything which his acting in person has made unnecessary.

 

“The reason is not because of some special privilege but on the purely pragmatic grounds that (a) there has actually been an expenditure of professional skill and labour by the solicitor party, (b) that expenditure is measurable, (c) the solicitor party would otherwise employ another solicitor and, if successful, would be entitled to recover the costs of that other solicitor, and (d) since he cannot recover for anything which his acting in person has made unnecessary, the unsuccessful party will have the benefit of that disallowance and so would pay less than if the solicitor party had instructed another solicitor.”

 

Although tribunals are not subject to the Civil Procedure Rules, and generally costs are not awarded, it must be the case that once a tribunal has decided, as here, that a party’s conduct warrants a costs order,  then it should apply the common law principles allowing a solicitor who acts for himself or herself to recover costs.

In a strange decision that turned logic on its head the judge said:

 

“62. I question the appropriateness of a firm of solicitors allocating as a fee earner in respect of Tribunal proceedings a person who is also the principal witness in the proceedings. In my view that creates scope for significant conflicts of interest and the ability to draw the line between those costs that are properly characterised as fees charged by the legal firm and costs which are not properly characterised because they relate to the time spent by Mr Markou in his capacity as the person giving instructions to the legal firm and its Counsel on the matter. I therefore disallow the costs claimed in respect of Mr Markou.”

 

Very obviously the costs would be much greater if the party/witness had to instruct an outside firm of solicitors.

If an individual acting for herself/himself can claim costs as a solicitor, then surely a solicitor acting for the separate legal entity of a limited company, of which she or he happens to be the sole director, must also be able to claim costs.

 

Comment

A wrong decision.

Also can we change the citations of TCC, which means both the Technology and Construction Court and the Tax and Chancer Chamber? Better still, confine initials to the same legal dustbin as Latin tags.

Res ipsa loquitur.

Written by kerryunderwood

August 12, 2020 at 10:53 am

Posted in Uncategorized

HIGH COURT SCRAPS COUNSEL’S FIXED COSTS IN EX-PORTAL CLAIMS: A VERY UNFORTUNATE DECISION

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The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

These principles, and the whole issue of Qualified One-Way Costs Shifting, is dealt with in my book – Qualified One-Way Costs Shifting, Section 57 and Set-Off – Available from me here for £15.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In

Finsbury Food Group Plc v Dover [2020] EWHC 2176 (QB)

the Queen’s Bench Division of the High Court considered counsel’s fees in ex-portal fixed costs cases.

This case was not about whether counsel’s fees were recoverable as a disbursement on the basis that they were reasonably incurred due to a particular feature of the dispute, pursuant to CPR 45.29I(2)(h).

That controversial issue was dealt with by me very recently in my blog –

FIXED COSTS: TWO RECENT CASES .

The case here related to the quantum of the fee for counsel, or a specialist solicitor, and in particular whether or not it was fixed.

Specifically, the issue was whether CPR 45.29I(2)(c) fixes any such fee at £150 plus VAT, as per CPR 45.23B, read with Table A, or whether such a fee falls outside CPR 45 altogether and is subject to assessment in the usual way; in other words are counsel exempt from fixed fees?

This was an Employer’s Liability claim which fell out of the portal.

CPR 45.29I(2)(c) allows recoverability of “the cost of any advice from a specialist solicitor or counsel as provided for in the relevant Protocol.”

The court held that CPR 45.23B and Table 6A do not apply to ex-portal claims as CPR 45.16 states that:

“This Section applies to claims that have been or should have been started under Part 8 in accordance with Practice Direction 8B (“the Stage 3 Procedure”).”

That was not the case here.

The court rejected the submission that it must have been intended, in what was undoubtedly a fixed costs case, that counsel’s fees be fixed, and fixed at Type C level that is £150 plus VAT.

Rather, the court held that the reference to “as provided for in the relevant Protocol” in CPR 45.29I(2)(c) was a reference to the principle therein, and not the amount therein, which some may find a somewhat surprising conclusion.

The court applied the logic that the fees for expert reports are not fixed, and so counsel’s fees do not need to be fixed either, and that in some cases the protocols do fix the costs of medical reports and could have done so in relation to counsel’s fees.

Consequently, counsel’s fee in an ex-portal claim is not fixed and is subject to assessment in the usual way, and here the court assessed the fee at £500 plus VAT.

So the law now is that in an ex-portal case involving a minor, where the law requires the advice of counsel or a specialist solicitor, you will recover no fee for such advice, even though required by law – see

Aldred v Cham [2019] EWCA Civ 1780

for a detailed write-up of that Court of Appeal decision – see my blog

FIXED COSTS AND COUNSEL’S FEES: SUPREME COURT REFUSES LEAVE TO APPEAL .

Neither does counsel recover a fee where s/he has prepared and served a skeleton argument, pursuant to a court order, where the case settles the day before trial – see

Coleman v Townsend, SCC Senior Court Costs Office, 13th July 2020, Case No: PHW 1806767.

However, where there is no court order, no requirement to obtain counsel’s advice etc etc, you are free to do so and its open costs time!

 

Comment

Perhaps this singular most ill-informed decision in the short life of fixed costs, and one that seriously undermines them.

At Paragraph 25, which I set out in full at the end of this piece, the court shows a misunderstanding of the concept of fixed costs, stating that claims which have fallen out of the portal are a mixed bag.

That may be true, but Parliament has chosen to adopt a swings and roundabouts approach, or a rough with the smooth approach, and that is the whole rationale of fixed costs.

If counsel’s fee can vary according to the nature of an ex-portal case, then why not the solicitor’s fee?

What was the point of the Court of Appeal, stating in

Qader & Ors v Esure Services Ltd & Ors [2016] EWCA Civ 1109

see my blog –

FIXED COSTS DO NOT APPLY TO ALL EX-PORTAL CLAIMS: QADER OVERTURNED: PARLIAMENT IGNORED

that an ex-portal claim is subject to fixed costs forever, whatever the complexity and value, unless and until it is allocated to the multi-track?

What was the point of Parliament subsequently clarifying the Civil Procedure Rules to confirm this?

The court here, without any hint of the irony of the point it was making, said that the rules allow for an amount exceeding fixed costs if there are exceptional circumstances – see CPR 45.29J.

Yes, that is the whole point!

There have to be exceptional circumstances, and those open up the whole bill, including solicitors’ fees, and is subject to fairly elaborate procedure, with severe costs penalties on those who seek, and fail, to show special circumstances.

A court cannot use that reference to pick and choose to allow extra costs without a CPR 45.29J finding of exceptional circumstances.

At Paragraph 25 of the judgment here is almost a parody of what fixed costs are all about, and is perhaps the most ill-informed paragraph of any superior court in the short life of fixed costs.

 

Advice to Solicitors

Just get any new case automatically forwarded to counsel.

Do nothing at all.

Claim your fixed costs for doing nothing.

Claim as high a counsel’s fee as you can – after all you will have done nothing whatsoever and counsel will have done all of the work.

You do not need special circumstances; you do not need a particular feature of the dispute; you need nothing at all.

 

Further Comment

Very obviously this decision is wrongly decided, per incuriam, in conflict with a Court of Appeal decision on point, and the will of Parliament.

Expect other courts to ignore it.

2021 will be fun when fixed costs come in for all claims up to £100,000, and where counsel’s fees will be fixed.

Did the High Court here really believe that it was intended to fix counsel’s fees in a claim worth say £95,000, but not in one worth, say, £10,500?

CPR 45.29F(2) limits defendant’s costs to those which would have been payable to the claimant at the same stage of the proceedings, so claimants are now at much greater risk in personal injury proceedings.

Denis Defendant instructs counsel on a no win lower fee basis £100 plays £1,000. Claimant fails to beat Part 36 offer – now liable for £1,000 – or whatever sum the court assesses. Few cases go to trial but the chilling effect of a defendant’s Part 36 offer in a fixed costs case, which effectively disapplies QOCS, is now glacial.

It also introduces a whole new level of uncertainty; as counsel’s fee is to be assessed a claimant will have no idea, by accepting a Part 36 offer late, what they will be paying – which sort of defeats the point of fixed costs.

I am not a great fan of the way the Civil Procedure Rules are written, but in fairness, it is very clear here what the Civil Procedure Rules Committee, fortified by the Court of Appeal and Parliament, meant, and this decision defies common sense, Parliament, and the Court of Appeal.

Parliament will re-visit this – expect a cut in fixed costs.

“25. I accept all that Mr Roy says concerning the impetus for the fixed costs regime and the underlying rationale of certainty and proportionality. However, claims which have fallen out of the Protocol are a mixed bag. Some small straightforward claims may fall out of the Protocol as a result of the failure by the defendant to respond to the CNF. But there are other reasons for a claim falling out of the Protocol including notification by the claimant that the claim has been revalued at more than the upper limit; where liability remains in dispute and where contributory negligence is alleged. As Stewart J recognised in Ferri v Gill [2019] Costs LR 367, these factors are likely to be associated with a much greater level of complexity, so making quantification of the claim all the more difficult. I see nothing absurd in the costs of such an advice on valuation not being fixed in those circumstances. Indeed, it might be said that the converse is true. It would be odd if the same fixed fee were to be recovered for valuing a straightforward claim worth £15,000 as for a claim which, as it turns out, includes a high claim for loss of earnings or handicap on the labour market the quantification of which may involve considerable skill and expertise. Further, the costs allowed will not be unchecked. Just as in this case, they are subject to assessment and may be reduced on assessment.”

Written by kerryunderwood

August 11, 2020 at 3:02 pm

Posted in Uncategorized

SET-OFF OF INTERIM COSTS ORDER AGAINST JUDGMENT SUM

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Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In

Ridley v Dubai Islamic Bank PJSC [2020] EWHC 2088 (Comm) (31 July 2020)

the court refused an application by the defendant bank for set-off of a costs order made in the proceedings in favour of the claimant, against a judgment debt the claimant owed to the bank from a previous action; the court has a discretion to order set-off of judgment sums, CPR 40.13 and inherent jurisdiction, and the test is whether it is just and equitable – see

Fearns v Anglo Dutch Paint and Chemical Company Ltd [2010] EWHC 2366 (Ch).

The judgment debt had been outstanding for several years but the application had to be considered in light of the circumstances in which the costs award had arisen.

The claimant had brought the proceedings to challenge his continued imprisonment in Dubai, which he claimed was the result of the wrongful actions of the bank and arose out of the underlying facts giving rise to its judgment debt.

The costs award had resulted from an unsuccessful protracted challenge by the bank to an order for service out which had delayed the substantive proceedings for over a year.

The court also had to consider whether set-off could adversely affect the just conduct of the proceedings.

Although the bank submitted that an order for set-off would not set a precedent, the judge doubted that and felt that if she ordered set-off, the bank would use that to support subsequent applications.

The risk of an adverse costs order was one of the few sanctions which could deter parties in litigation from bringing unmeritorious applications; that could be weakened or removed here, given the parties’ relative financial resources.

The bank would be able to resist the claimant’s claim, regardless of cost constraints, in circumstances where it had no apparent interest in pursuing its defence to the proceedings expeditiously.

It would not be consistent with the overriding objective to allow the bank not to pay the costs order for an unsuccessful application as the overriding objective requires the court to ensure that the parties are on an equal footing so far as practicable and that litigation is dealt with expeditiously and fairly.

The bank would suffer no prejudice if set-off was refused as the amount of the costs award was relatively modest, compared to the judgment debt, and the bank had some security over land.

Written by kerryunderwood

August 11, 2020 at 8:02 am

Posted in Uncategorized

GROUP LITIGATION ORDERS: GUIDANCE ON SELECTING SAMPLE CLAIMANTS

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The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In

Lancaster and others v Peacock QC [2020] EWHC 1231 (Ch)

The Chancery Division of the High Court considered the appropriate procedure for selecting sample claimants in group litigation,  and gave guidance as to the purpose of sample claimants.

The issue arose in the context of two separate claims which overlapped on the facts and the law.

There were 123 claimants in the first claim and 33 claimants in the second, and the parties had agreed that the two cases should be case managed together and that the first claim and part of the second claim should be tried together.

The court said that the purpose of taking sample claimants is:

  • to ensure that issues common to all of the claims can be decided in such a way so as to bind all claimants;
  • to decide other factual and legal issues, where the decision will not necessarily bind other claimants but is likely to give a clear indication of the way their cases will be decided, with the expected consequence that the parties will then be able to settle the remaining claims.

The court also commented that it is not necessary to have many sample claimants to decide common issues, but a broader selection of sample claimants can generate sufficiently broad guidance for the likely disposal of all other claims, even with varied facts, while not overcomplicating or significantly adding to the cost of the trial.

Here, there were two rival proposals for selecting sample claimants.

The court preferred the claimants’ two-stage proposal which involved all 123 claimants responding to a questionnaire about their individual circumstances and claims.

From that, the parties would each select initial sample claimants, who would be required to produce certain documents relating to their answers, so as to facilitate a final selection of sample claimants by each party, to ensure that all non-common factual issues were covered.

The defendant’s proposal involved all 123 claimants answering the questionnaire and producing documents at the same time, but the court did not want to impose a more complex exercise on all 123 claimants at a time when some of them would almost inevitably be affected by the COVID-19 outbreak.

It also recognised that some questions might raise legal professional privilege issues, which might require individual advice, imposing a substantial burden on the claimants.

Written by kerryunderwood

August 7, 2020 at 2:18 pm

Posted in Uncategorized

DATA PROTECTION AND LEGAL PROCEEDINGS: IMPORTANT COURT OF APPEAL DECISION

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Underwoods Solicitors specialize in Data Protection issues and were the solicitors in the Cambridge Analytica case.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In

Johnson v Secretary of State for the Home Department [2020] EWCA Civ 1032

the Court of Appeal was dealing with five issues concerning the application of the Data Protection Act 2018, and the General Data Protection Regulations, in the context of the lawfulness of the transfer of data from the Home Office in the United Kingdom to the British High Commission in Jamaica for the purposes of an out of country appeal, in circumstances where the appellant, the subject of the data, had refused to consent to the transfer of the data.

The appeal was from a decision of the Upper Tribunal (Immigration and Asylum Chamber) (Mr Justice Lane, President; Upper Tribunal Judge Wikeley; and Upper Tribunal Judge O’Connor) dated 12 March 2019. The Upper Tribunal dismissed an appeal from the decision of the First Tier Tribunal (“FTT”) (Judge Clements President; Designated FTT Judge McCarthy; and FTT Judge Carter) which had heard on 17 July 2018 an appeal by the appellant against the decision of the respondent Secretary of State to refuse his human rights claim.

When the appeal was heard the appellant was at the High Commission in Kingston, Jamaica, and the FTT was sitting in Birmingham, UK. They were linked by video-link. The appellant gave evidence by video-link. The appellant did not object to the fact that the proceedings were by video-link (and this appeal, heard under restrictions imposed by the COVID-19 pandemic, was heard remotely by video-link) but objected to the fact that giving live evidence from Jamaica involved a breach of both EU and domestic data protection laws. The appellant also contended that he was the victim of unlawful discrimination.

It is not necessary to recite the facts of the case for the purposes of the data protection issues, but paragraphs 5 to 13 of the judgment show an extraordinary litany of the failure to deport the appellant who had been in the United Kingdom illegally since 26 June 2002 and committed a number of serious offences.

 

Issue One

Whether the Appellant Could Object to The Processing of His Sensitive Personal Data

Article 21 of the GDPR sets out the right to object to the processing of personal data. The data subject has the right to object and the controller shall no longer process the data “unless the controller demonstrates compelling legitimate grounds for the processing which override the interests, rights and freedoms of the data subject or for the establishment, exercise or defence of legal claims”

Here the Court of Appeal held that the proceedings in the First Tier Tribunal were covered by the words “the establishment, exercise or defence of legal claims”.

Consequently, the appellant had no right to object to the processing of his data for the purposes of hearing the appeal.

Article 3 of the Regulations allows Member States to restrict Article 21 rights so long as the restriction respects the essence of the fundamental rights and freedoms and is a necessary and proportionate measure in a democratic society to safeguard, amongst other things, the protection of judicial independence and judicial proceedings and the enforcement of civil claims.

The relevant restrictions are set out in the Data Protection Act 2018 at Section 15 and Schedule 2.

Here the Court of Appeal said:

 

“45. Paragraph 5 of schedule 2 of the DPA 2018 is headed “information required to be disclosed by law etc or in connection with legal proceedings”. Paragraph 5(3) provides that the “the listed GDPR provisions do not apply to personal data where disclosure of data- (a) is necessary for the purpose of, or in connection with, legal proceedings … (c) is otherwise necessary for the purposes of establishing, exercising or defending legal rights” to the extent that the application of those provisions would prevent the controller from making disclosure. In my judgment the transfer and disclosure of the data was necessary for the legal proceedings, being the appeal to the FTT. Further the transfer and disclosure of the data in the bundle was necessary for the purpose of establishing the appellant’s human rights claim and for the respondent’s defence of that claim.”

“48. Further paragraph 14(3) of schedule 2 provides “as regards personal data … the listed GDPR provisions do not apply to the extent that the application of those provisions would be likely to prejudice … judicial proceedings”. In my judgment preventing the hearing of the appeal would prejudice judicial proceedings, and the restriction of the right to object is necessary and proportionate for the same reasons. Therefore, in my judgment, the appellant is not entitled to object to the processing of his data in the use of video link, and by transferring a bundle to the British High Commission.”

 

Issue Two

The Arrangement for Erasure of Personal Data

Article 17 of the GDPR provides a right to erasure of personal data, which is sometimes known as the right to be forgotten.

There must be proper protection of personal data, see generally the discussion at paragraph 122 of C-2013/15

Tele2 Sverige AB v Post-och telestyrelsen [2017] QB 771,

in the context of data retained by providers of electronic communications services.

In this case there were assurances that the data which was transferred to the British High Commission in Kingston, Jamaica would be destroyed after seven days.

The FTT considered these assurances and found them to be reliable. The Upper Tribunal noted that there was no serious challenge to these findings by the FTT.

The Court of Appeal could see no basis for finding that there is any infringement of the appellant’s rights to erasure. It appears from the evidence before the FTT that there was proper protection of the appellant’s data.

 

Issue Three

Whether the Appellant Could Object to The Transfer of His Personal Data to Jamaica

The Court of Appeal followed the example of the First Tier Tribunal and Upper Tribunal in leaving open the question of whether transfer of data to a British High Commission involved transfer to another country, the argument being that a High Commission is inviolable and protected by public international law and treaties and is not part of another country.

No decision was necessary on that point in this case as Article 49(e) of the Regulations allows transfer without consent if the transfer is necessary for the establishment, exercise or defence of legal claims, and here the Court of Appeal found that it was.

In

Routier and another v HMRC [2019] UKSC 43

the Supreme Court considered the issue of whether Jersey is a third country for the purposes of directly applicable provisions of European Union law dealing with the free movement of capital.

The Supreme Court decided that the question whether a country is a “third country” is context-specific and will depend on whether, under the relevant Treaty of Accession, the relevant provisions of EU law apply to that territory.

Here the relevant Treaty of Accession provided that provisions of EU law would not apply generally in Jersey.

Accordingly, Jersey was to be regarded as a “third country”.

 

Issue Four

Whether There Was Impermissible Discrimination Against the Appellant

Here the Court of Appeal found that as the appellant was not a European Economic Area national he was not in a similar position to the comparators on whom he sought to rely, that is EEA nationals who were allowed to take advantage of the regulations.

The European Union does not protect non-EU nationals against racial discriminations; indeed the whole basis of the European Union is that people of certain races and nationalities have advantages over and above other nationals, something not regularly picked up in debate as to whether the United Kingdom should, or should not, be in the European Union.

 

Issue Five

Whether There Was an Infringement of The Appellant’s Human Rights

On the facts, the Court of Appeal upheld the decision of the lower tribunals that the procedure and the result in this case were fair.

You might think that unsurprising if you have read Paragraphs 5 to 13.

In paragraphs 59 and 60 of the judgment the Court of Appeal dealt with other matters, and the inevitable tension between the deportee, the subject of the data transfer, and the controller of the data, the Secretary of State for the Home Department, who had deported him.

“59. For the reasons set out above in my judgment the FTT and the Home Office were entitled to transfer a bundle containing the appellant’s personal data to the British High Commission in Jamaica for the purpose of hearing the appellant’s out of country appeal. I note that the FTT specifically recorded in paragraph 146 of their judgment that they understood the appellant’s reluctance to trust or co-operate with the respondent, given that the appellant had been deported. It is obvious that in such circumstances the appellant is unlikely to be well-disposed to the respondent. The FTT also went on to find, in the circumstances of this particular appeal, that the appellant had good reason to object to the processing of his personal data. I say nothing more of the appellant’s situation in the light of that finding of fact by the FTT.

60. However even if there had been no lawful basis, in the absence of specific consent from an appellant, to transfer a bundle for the purposes of hearing an out of country appeal, it should not be thought that the inevitable remedy will be an adjournment of the appeal so that the appellant may apply for leave to enter the UK to take part in the appeal in person. This is because even if the appeal is heard in the UK, it will involve the processing of the appellant’s data. If an appellant objects to the processing of his data for the purposes of his appeal overseas it would be difficult to see why the appellant should not object to the processing of his data in the UK. In these circumstances it is not immediately apparent what would therefore be gained by adjourning the appeal so that the appellant could return to the UK. Further if an appellant objects to the processing of his data for the purposes of frustrating the appeal hearing and there is no lawful basis by which the appeal may otherwise be heard using the appellant’s data, the FTT may consider that the appellant is deliberately frustrating and therefore abusing the appeal process. The FTT may in those circumstances consider whether to continue with the hearing, making it as fair as the appellant permits it to be.”

 

Comment

A very useful and thorough examination of Data Protection law in the context of legal proceedings, and in my experience few lawyers realise that, for all intents and purposes, legal proceedings are exempt from the provisions of the Data Protection Act 2018 and the General Data Protection Regulations.

Written by kerryunderwood

August 7, 2020 at 11:36 am

Posted in Uncategorized

PART 36: WITHDRAWN OFFER STILL COUNTS: AN UNFORTUNATE DECISION

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The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

These principles, and the whole issue of Qualified One-Way Costs Shifting, is dealt with in my book – Qualified One-Way Costs Shifting, Section 57 and Set-Off – Available from me here for £15.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In

Blackpool Borough Council v Volkerfitzpatrick Ltd [2020] EWHC 2128 (TCC)

the Technology and Construction Court, part of the High Court, considered the correct approach to costs where a Part 36 offer has been withdrawn and where the claimant recovers less at trial than had been on offer.

It was common ground that the automatic consequences of Part 36 do not apply to a withdrawn offer – see CPR 36.17(7)(a).

However, the offer may still be taken into account under the general costs provisions in CPR 44, specifically CPR 44.2(4)(c), with the key issue being whether the recipient of the offer acted reasonably in rejecting it when it was available – see

Thakkar v Patel [2017] EWCA Civ 117.

Here, the court held that the claimant did indeed act unreasonably in not accepting the defendant’s Part 36 offer, which was subsequently withdrawn, and ordered the successful claimant to pay 80% of the defendant’s costs after the expiry of the 21 day period for accepting a Part 36 offer.

The judgment here also sets out how the court should consider the reasonableness of rejecting, or failing to accept, Part 36 offers which are subsequently withdrawn.

The court should put itself in the position of the claimant at the time of the offer and not judge the case with hindsight.

The court should consider the reasonableness of the non-acceptance, taking into account the facts and matters relating to the merits of the claim as they ought reasonably to have appeared to the claimant at that time, and not by reference to wider commercial factors.

Here, the claim was for £6.7 million in relation to a tram depot and the claimant won on six out of seven matters, but recovered only £1.1 million, with the awards on many of the successful elements of the claim being cut sharply, in one case by over 90%.

The court held that it was unreasonable for the claimant not to accept the Part 36 offer as it knew, or was in a position to know, that its case had been significantly weakened by test results and therefore there was a real risk that it would fail to beat the offer.

The claimant had taken a commercial risk.

The defendant was awarded 80% of its costs in relation to the subject matter of the Part 36 offer from 21 days after its service.

The case is also significant for the court choosing to make a percentage costs order rather than an issue based costs order and thus is inline with the very recent case of

Jones v Ministry of Defence [2020] EWHC 1987 (QB)

dealt with in my blog –

PROPORTIONATE COSTS ORDERS PREFERRED TO ISSUE BASED COSTS ORDERS: UPDATED:

TWO NEW CASES

Here the court said:

 

“81. Whilst it would be possible to make an issue based costs order after 6 September 2019, this is a paradigm case for the court to make a percentage order if practicable under CPR Part 44.2(7), because an order awarding the claimant the costs of the tram doors issue alone would not reflect the fact that there are two reasons why the case went to trial, the first being the claimant’s failure to accept the defendant’s Part 36 offer and the second being the defendant’s unexplained (and, frankly, rationally inexplicable) decision to exclude that claim from its Part 36 offer.”

 

Comment

With respect, the court here appears to have got confused between disallowing a successful party’s costs, and indeed ordering them to pay part of the other side’s costs, and Part 36.

Absent any Part 36 offer, it is almost inconceivable that the claimant here would have recovered all of its costs, by virtue of the facts set out above.

It is also true that the court has a very wide discretion in CPR 44 in relation to costs.

However, it cannot be right that a withdrawn Part 36 offer should ever get anywhere near having the same consequences as an offer capable of acceptance.

Here, the claimant had to plough on, as once the offer was withdrawn, there was no offer to accept, and no way that the claimant could end its claim, which did, after all, result in an award of £1.1 million.

The defendants here have been allowed to eat their cake and still have it, that is to be at no risk of any offer being accepted after it was withdrawn, but, for all intents and purposes, getting the full protection in costs of Part 36.

This is open to heavy abuse. A defendant makes a Part 36 offer very early on in the case, and almost immediately withdraws it. Thus, if the claimant accepts the offer then that is that and the defendant is liable for limited costs as the offer has been made very early on.

Why, in those circumstances, should the defendant then get protection in relation to potentially millions of pounds of costs incurred when the other party had no mechanism for ending the case, short of discontinuance, when it would also be liable for the defendant’s costs?

Part 36 is difficult enough anyway, and I understand the logic of a court having to take into account a non-Part 36 offer, such as a Calderbank offer, as such offers give more flexibility than Part 36 and may be entirely reasonable in the particular circumstances of the case.

However, I see no justification whatsoever for a withdrawn Part 36 offer ever being taken into account in relation to costs.

This decision should be overturned on appeal.

Written by kerryunderwood

August 6, 2020 at 4:49 pm

Posted in Uncategorized

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