QOCS, APPEALS, SET-OFF & KAFKA
A claimant loses a personal injury claim and a costs order is made in the usual way but the judge also finds fundamental dishonesty and thus allows enforcement of the costs order totalling £7,210.00.
The claimant appeals against the finding of fundamental dishonesty, but not the loss of the claim, and wins and so the finding of fundamental dishonesty is quashed and the claimant is awarded costs of the appeal of £12,500.00.
The original order against the claimant in respect of the costs of losing the personal injury claim remains in place but is now unenforceable.
The Appeal Judge makes no reference to CPR 44.12 which reads:-
- Where a party entitled to costs is also liable to pay costs, the court may assess the costs which that party is liable to pay and either –
- set off the amount assessed against the amount the party is entitled to be paid and direct that party to pay any balance; or
- delay the issue of a certificate for the costs to which the party is entitled until the party has paid the amount which that party is liable to pay.”
Thus the court here chose not to exercise that discretion, although it appears that this provision, which very obviously applies to the facts of this case, was not drawn to the judge’s attention.
Could the defendant, successful in the primary claim, set-off the £7,210.00 owed to it, under the common law doctrine of set-off?
Yes, in my view – see Kai Surrey v Barnet & Chase Farm Hospitals NHS Trust  EWHC B16 (Costs).
Nothing in CPR 44.12 overrules the common law.
This has the curious effect of the claimant successfully appealing against a finding of fundamental dishonesty, and therefore enforceability of a costs order, nevertheless having to pay those first instance costs by way of set-off against its costs for successfully pursuing the appeal.
Heads you lose; tails you do not win.
Only Kafka, Lord Justice Jackson or the Rules Committee could have written this. For me, The Metamorphosis, The Interim Report, The Trial, the Civil Procedure Rules, The Castle and the Final Report are barely distinguishable, but I know which are better written.
These are the facts of Meadows v La Tasca Restaurants Ltd, Manchester County Court, Claim no. B27YX178, 21 June 2016.
The defendant did not seek CPR 44.12 Set-Off and nor did it utilise the common law right of Set-Off.
Kafka did not get round to writing this one up, so I have done it for him.
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