Kerry Underwood

Archive for October 2017

PART 36 AND LATE ACCEPTANCE: SUPER OMNISHAMBLES

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I am organizing, chairing, and speaking at a Part 36 Conference in Central London on Tuesday 14 November with Ben Williams QC and David Pilling. For more information, or to book, click here.

In Whalley v Advantage Insurance Company Limited, Kingston-Upon-Hull County Court, 5 October 2017, case number – B58YM864

Regional Costs Judge Besford held that on late acceptance by a Defendant of a Claimant’s Part 36 offer, the Claimant was only entitled to fixed costs, in a fixed costs case, and not indemnity costs.

As we have seen from previous posts of mine on this subject, First Instance and Circuit Judge decisions are all over the place on this subject, and apparently the issue will be heard by the Court of Appeal reasonably soon.

Why then am I bothering to mention this further decision?

Because it adds a new ingredient to the stew.

The reason is that District Judge Besford, in this decision, actually refutes his own decision in Sutherland v Khan, which I have reported extensively elsewhere.

There, the judge held that on late acceptance by a Defendant a Claimant was entitled to indemnity costs and not fixed costs.

He has now changed his mind.

Now, there is something to be said in praise of anyone who has the courage to admit that they were wrong, but this does add yet further confusion to this vitally important issue.

It is chaos.

I do not blame the individual judges as the Civil Procedure Rules are entirely unhelpful and there is a clear contrast between CPR 45.29 and CPR 36.

This is far from the only instance in which there are mutually contradictory Civil Procedure Rules.

This tension, on this matter of extreme importance as far as costs are concerned, has been apparent for nearly five years and yet throughout the whole of that time the Civil Procedure Rules Committee have not thought it necessary to amend the rules, or issue a Practice Direction.

Soon we will have a new Intermediate Track, with a streamlined procedure and fixed costs in virtually all civil litigation where the damages are £100,000.00 or less.

One hopes that the Civil Procedure Rules Committee will draft the new Intermediate Track Fixed Costs Rules with rather more care than they have drafted the existing Fast Track Fixed Costs Rules.

 

Also see:

PART 36 AND INDEMNITY COSTS

ACCEPTING A PART 36 OFFER DURING TRIAL

PART 36 AND INDEMNITY COSTS ON LATE ACCEPTANCE: THE CHAOS CONTINUES

PART 36 AND LATE ACCEPTANCE: EVEN MORE CHAOS

FIXED COSTS AND PART 36: POST 3

PART 36: CLAIMANT ORDERED TO PAY INDEMNITY COSTS ON LATE ACCEPTANCE

Written by kerryunderwood

October 31, 2017 at 8:53 am

Posted in Uncategorized

NOTICE TO ADMIT FACTS AND FIXED COSTS

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All of these matters are dealt with in my new book – Personal Injury Small Claims, Portals and Fixed Costs, running to three volumes and 1,300 pages and costing £80.00 and available from me here or Amazon here.

In a Fixed Costs world the less work done the better, and so some neglected tactical tools will gain a new lease of life.

One of those is the Notice to Admit Facts, on prescribed Form N 266, which gives notice to another party in the proceedings that it is being required to:

– admit identified facts in the claim; and

– agree how the admitted facts will be treated.

The party responding to the notice must state which facts are admitted and which are not.

Thus the facts which need to be proved at trial can be reduced, thus cutting time and costs, which is essential in the new Intermediate Track.

Any Notice to Admit must be served no later than 21 days before trial – CPR 32.18(2).

There is no time limit for responding.

More than one Notice to Admit may be served.

Where there are multiple parties, there is no need to serve them simultaneously – MMR and MR Vaccine Litigation (No 5), Sayers v Smithkline Beecham Ltd [2002] EWHC 1280 (QB).

Responding

Failure to respond or an unreasonable failure to admit a fact can lead to costs consequences. In the Intermediate Track unreasonable behaviour can lead to a fixed uplift on fixed costs of 30% or 40%.

Admissions can be made by completing the bottom section of Form N 266 or by service of a respondent’s own Form N 266.

Facts are admitted for the purpose of the claim only and on the basis that the admitted fact /admission will not be used on any other occasion or by any other person- CPR 32.18(3).

The court may allow a party to amend or withdraw an admission on such terms as it thinks just- CPR 32.18(4).

In Practice

When drafting the Statement of Case, limited to 10 pages in Intermediate Track cases, consider all facts that may be capable of admission and serve a Notice to Admit.

Total witness statements for each party are limited to 30 pages in the Intermediate Track, so Notices to Admit may help cut down the length of the statements.

Admissions may also reduce the number of witnesses attending trial, and thus cut the trial length.

This could result in a claim moving down a Complexity Band and thus lessening costs. That benefits the ultimate paying party but reduces the risk for both parties and means that the fee, whether from the other side or one’s own client, will be earned for less work.

A further review should be undertaken once witness statements are exchanged and again once the matter is nearing trial, and the whole issue should be kept under constant review.

With Fixed Costs less work equals more profit, a reversal of the hourly rate system, so the more that is agreed, the better for both sets of lawyers and their clients.

 

Also see:

FIXED COSTS REPORT OVERVIEW : POST 1

FIXED COSTS AND PART 36: POST 3

FIXED COSTS: THE FAST TRACK FIGURES: POST 4

JUDICIAL REVIEW AND FIXED COSTS: POST 5

CLINICAL NEGLIGENCE AND FIXED COSTS: POST 6

THE NEW FIXED COSTS REGIME: POST 7

FIXED COSTS EXTENSION: WHAT TO DO NOW

APPLICATIONS, INJUNCTIONS, NON-MONETARY RELIEF AND FIXED COSTS

Written by kerryunderwood

October 27, 2017 at 8:23 am

Posted in Uncategorized

APPLICATIONS, INJUNCTIONS, NON-MONETARY RELIEF AND FIXED COSTS

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This blog first appeared in Practical Law on 24 October.

All of these matters are dealt with in my new book – Personal Injury Small Claims, Portals and Fixed Costs, running to three volumes and 1,300 pages and costing £80.00 and available from me here or Amazon here.

Fast Track 

In relation to the Fast Track, Lord Justice Jackson proposes no change and the only suggestion, emanating from Claimant representatives, was that there should be better provision for the costs of Pre-Action Disclosure Applications as recommended by the Court of Appeal in Sharp v Leeds City Council [2017] EWCA Civ 33.

 

Interim applications in the Fast Track

LJ Jackson states that the costs of any applications properly made, for example because the other party is in default, should be recovered separately.

CPR 45.29H currently fixes costs for such matters and provides for “one half of the applicable Type A and Type B costs.”

Type A is for preparation and Type B is for advocacy and each type of costs is £250.00.

In relation to Noise-Induced Hearing Loss claims and Fast Track Band 4 cases, the report proposes that two thirds, rather than one half, of Type A and Type B costs be recoverable.

Thus the fee would be £166.66, instead of £125.00, an increase of £41.66 which will probably not open the floodgates.

Band 4 in the Fast Track is in many ways more like Band 1 in the Intermediate Track than it is its Fast Track siblings.

Fast Track Band 4 cases will include Employers’ Liability other than Noise-Induced Hearing Loss claims, any particularly complex tracked possession or housing disrepair claims, property disputes, professional negligence claims and “other claims at the top end of the Fast Track.”

 

Preliminary issues

The costs of any preliminary issue trials should be recovered separately, but are strongly discouraged in the Fast Track.

The report points out that limitation is sometimes tried as a preliminary issue in Employers’ Liability disease claims but states that this is generally unwise as:

(i) there is much overlap of evidence between limitation and liability;

(ii) the litigation will get hopelessly bogged down if the limitation decision is appealed;

(iii) to have two trials of a Fast Track case drives up costs and is disproportionate;

(iv) if the claimant wins on limitation and then loses on liability, the first trial has been a waste of time.

 

Interim injunctions

The fixed recoverable fee for an interim injunction application in the Fast Track should be £750.00.

Non-Monetary Claims

All Fast Track claims will be subject to Fixed Recoverable costs, even where the claim is only, or primarily, for non-monetary relief.

With reference to the Fixed Costs Grid, LJ Jackson says;

“There is obviously some difficulty in applying the above table to claims for, or including, non-monetary relief. The court must, I am afraid assign a value to such relief. I propose that a claim for a declaration or injunction should be treated as the equivalent of a claim for £10,000, with the court having power to vary that figure upwards or downwards.

“For example, in a housing disrepair claim where the defendant is ordered to carry out repairs with a value of £20,000, the injunction requiring such works should be treated as if it were an award of £20,000.”

 

Intermediate Track

The report states that the new Intermediate Track, for claims valued at between £25,000.00 and £100,000.00 should apply to claims which are principally for monetary relief, such as damages or debt, and will include cases where declarations are sought “largely to support claims for monetary relief.”

It will not be possible evade the regime by including incidental claims for declaratory relief.

In exceptional circumstances a claim for non-monetary relief may be assigned to the FRC Scheme, where it is necessary to promote access to justice and two examples are given:

(i) If individual householders are claiming an injunction to restrain private nuisance caused by a nearby industrial enterprise, they may not be able to proceed unless their adverse costs risk is limited by an FRC regime.

(ii) Individuals of modest means bringing defamation claims because of material on the internet may only feel comfortable if their adverse costs risk is limited by FRC.

LJ Jackson also suggests that in certain categories of litigation, “where emotions are apt to run high, parties may need to be protected from their own enthusiasm for the fray” where “the straitjacket of the Intermediate Track may save them from ruinous litigation.”

He gives as examples disputes about family businesses or boundary disputes between neighbours, where the disputed land has no great value.

It may be that declaratory, and not monetary, relief is the main remedy sought in such cases, but they may still go into the FRC regime.

 

Applications

These should be made at the Case Management Conference (CMC) but if any application is necessary after the CMC then the rules should provide that:

(i) all applications and documents filed in support must be concise;

(ii) the respondent must answer in writing within 7 days of service of the application notice and the response must be concise;

(iii) any reply from the applicant must be provided within two business days of service of the response and be concise;

(iv) the court will deal with an application without a hearing unless it considers it necessary to hold one and in appropriate cases that hearing may be by telephone,

(v) the court will decide who shall pay the costs of any interim application and shall summarily assess them and any such costs will be in addition to FRC.

 

Vexatious applications

Lord Justice Jackson accepted that the court must control the scope and number of interim applications to avoid procedural gamesmanship, for example repeated applications by a wealthy party for specific disclosure or for answers to CPR 18 requests.

This would be dealt with as unreasonable litigation conduct warranting an order for indemnity costs, which will now be a fixed uplift on costs, of either 30% or 40% – that issue remains to be decided.

As to what constitutes unreasonable litigation conduct, Lord Justice Jackson refers to the case of Dammermann v Lanyon Bowdler LLP [2017] EWCA Civ 269.

 

The future

The report states that if the new proposals work satisfactorily then the Civil Procedure Rule Committee may decide to expand the scope of the Intermediate Track to include monetary claims above £100,000.00 and to include claims for non-monetary relief.

 

Also see:

FIXED COSTS REPORT OVERVIEW : POST 1

FIXED COSTS AND PART 36: POST 3

FIXED COSTS: THE FAST TRACK FIGURES: POST 4

JUDICIAL REVIEW AND FIXED COSTS: POST 5

CLINICAL NEGLIGENCE AND FIXED COSTS: POST 6

THE NEW FIXED COSTS REGIME: POST 7

FIXED COSTS EXTENSION: WHAT TO DO NOW

Written by kerryunderwood

October 25, 2017 at 9:41 am

Posted in Uncategorized

CONTRA PROFERENTEM: DOES IT STILL EXIST?

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By Mohammed Tanweer, Underwoods Solicitors

The contra proferentem rule is generally considered to have originated from the decision of the privy council in

Canada Steamship Lines Limited v The King [1952] AC 192

and that rule requires any ambiguity in an exemption clause or indemnity clause in a contract to be resolved against the party who put the clause forward and relies upon it.

At paragraph 208 Lord Morton said:

“(1) If the clause contains language which expressly exempts the person in whose favour it is made (hereafter called “the proferens”) from the consequence of the negligence of his own servants, effect must be given to that provision. Any doubts which existed whether this was the law in the Province of Quebec were removed by the decision of the Supreme Court of Canada in The Glengoil Steamship Company v Pilkington.

(2) If there is no express reference to negligence, the court must consider whether the words used are wide enough, in their ordinary meaning, to cover negligence on the part of the servants of the proferens. If a doubt arises at this point, it must be resolved against the proferens in accordance with Article 1019 of the Civil Code of Lower Canada: “In cases of doubt, the contract is interpreted against him who has stipulated and in favour of him who has contracted the obligation.”

(3) If the words used are wide enough for the above purpose, the court must then consider whether “the head of damage may be based on some ground other than that of negligence”, to quote again Lord Greene in the Alderslade case. The “other ground” must not be so fanciful or remote that the proferens cannot be supposed to have desired protection against it; but subject to this qualification, which is no doubt to be implied from Lord Greene’s words, the existence of a possible head of damage other than that of negligence is fatal to the proferens even if the words used are prima facis wide enough to cover negligence on the part of its servants.”

In Persimmon Homes Limited & Others v Ove Arup and Partners Limited & Another [2017] EWCA Civ 373

where Lord Justice Jackson considered the modern application of the doctrine.

Lord Justice Jackson said that the principle set out in the Canada Steamship case is of more relevance to indemnity clauses, rather than exemption clauses when incorporated into a commercial agreement.

He said that the contra proferentem rule now had a very limited role in commercial contracts negotiated between parties of equal bargaining strength:

“In recent years, and especially since the enactment of UCTA [The Unfair Contracts Terms Act] the courts have softened their approach to both indemnity clauses and exemption clauses: see Lictor Anstalt v MIR Steel UK [2012] EWCA Civ 139; [2013] 2 ALL ER (Comm) 54 at [31][2][34]. Although the present judgment is not the place for a general review of the law of contract, my impression is that, at any rate in commercial contracts, the Canada Steamship guidelines (insofar as they survive) are now more relevant to indemnity clauses than to exemption clauses.”

Consequently the Court of Appeal drew a distinction between the application of the contra proferentem doctrine in exemption clauses and indemnity clauses, and it is clear that the doctrine still has potential application to indemnity clauses.

The Court of Appeal stated that, as a general principle, exemption clauses were used for allocating risk in commercial contracts.

However the Court of Appeal did not extend that reasoning to indemnity clauses.

In any event, much will turn on the wording of the clauses and also the negotiating strength of the parties.

The Persimmon case concerned the meaning of the words “liability for any claim in relation to asbestos is excluded”.

The Claimants submitted that these words did not exclude liability for negligence in failing to identify and report on asbestos found at the site, and they relied on the contra proferentem rule.

The Court of Appeal held that all liability relating to asbestos, including that arising from negligence, was excluded.

The court relied on the clarity of the language.

There is a debate and tension between the court giving a contract a commercial common sense interpretation – the Commercial Meaning Test – and focusing on the language used – the Language Primacy Test.

The commercial common sense interpretation took precedence in the case of

Rainy Sky SA v Kookmin Bank [2011] UKSC 50

whereas the Language Primacy Test took precedence in

Arnold v Britton [2015] UKSC 36.

In Wood v Capita Insurance Services Limited [2017] UKSC 24

the Supreme Court denied any such tension and said that interpretation was a unitary exercise and the weight to be given to the various considerations depended on the circumstances.

Courts give the language use the meaning which would be given by a reasonable person in the position of the parties and furnished with their common knowledge of the background to the transaction.

Others argue that little has changed. In the 1889 case of

Cornish v The Accident Insurance Company Limited [1889] 23 QBD 453

the Court of Appeal said:

“In a case of real doubt, the policy ought to be construed most strongly against the insurers; they frame the policy and insert the exceptions. But this principle ought only to be applied for the purpose of removing a doubt, not for the purpose of creating a doubt, or magnifying an ambiguity, when the circumstances of the case raise no real difficulty.”

Canada Steamship itself made it clear that the stated principles were only employed where there was doubt as to whether the words used were wide enough to cover negligence, and thus the issue may simply be resolved via contractual interpretation in the future.

Clearly careful consideration needs to be given when drafting contractual clauses relating to indemnity and/or exemption.

It also appears that where the parties have unequal bargaining power, the contra proferentem rule may still apply.

Where the court cannot achieve protection for the weaker party through various statutory provisions, such as the Unfair Contract Terms Act 1977 and the Consumer Rights Act 2015, it could still apply the principles.

Section 69(1) of the Consumer Rights Act 2015 is a statutory restatement of the contra proferentem rule in favour of the weaker party:

“If a term in a consumer contract, or a consumer notice, could have different meanings, the meaning that is most favourable to the consumer is to prevail.”

That will not always be against the preparer of the contract, but in fact in a consumer contract it will virtually always be the stronger party, that is the non-consumer, who has prepared the contract.

As we have seen the doctrine is likely to continue to have relevance in relation to the indemnity clauses.

Indemnity clauses are ones which provide for one party to give an indemnity to another for losses occurring on the happening of certain events.

One of the issues that can arise is as to whether a person guilty of negligence can benefit from the indemnity given by the other party to the contract.

Following the Canada Steamship case, the courts have generally required that either there must be a reference to negligence in order for such liability to be included in the indemnity or the language must be wide enough to cover negligence.

Persimmon suggests that where indemnity clauses are involved, the Canada Steamship guidelines may continue to have a role, but if the language used is clear then the role of the rule may be limited, or indeed non-existent.

The modern approach is that courts are less likely to resort to rules for construction generally to resolve issues of interpretation, but are more likely to focus on the language and the contact.

The Court of Appeal said in

K/S Victoria Street v House of Fraser [2011] EWCA Civ 904

that “such rules are rarely, if ever, of any assistance when it comes to construing commercial contracts”.

This modern approach also raises doubts as to whether other traditional principles of construction will continue to be relevant.

The doctrine of expressio unius est exclusio alterius asserts that the express mentioned of a particular thing shows an intention to exclude another similar thing.

The principle of ejusdem generis is that when general words follow a list of specific matters, often causes or events, of a similar kind, the general words may be given a similarly limited meaning.

In Transocean Drilling UK Ltd v Providence Resources Plc [2016] EWCA Civ 372

the first instance judge used the ejusdem generis principle to cut down the meaning of “loss of use” in that contract.

However the Court of Appeal overturned that decision and had regard to the language and context and disregarded both the ejusdem generis and contra proferentem principles.

Written by kerryunderwood

October 24, 2017 at 9:02 am

Posted in Uncategorized

PORTALS: EMPLOYERS’ LIABILITY OR PUBLIC LIABILITY?

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All of these matters are dealt with in my new book – Personal Injury Small Claims, Portals and Fixed Costs, running to three volumes and 1,300 pages and costing £80.00 and available from me here or Amazon here.

What happens if an employee suffers an injury at a work-related social event, or when attending work outside normal working hours, for example to collect pay?

Is that an Employers’ Liability or a Public Liability Portal claim?

Under paragraph 1.1(14) of the Employers’ Liability and Public Liability Portal, which is a single portal, the definition of employers’ liability claim is given as follows:

 

(14) ‘employers’ liability claim’ means a claim by an employee against their employer for damages arising from—

(a) a bodily injury sustained by the employee in the course of employment; or

(b) … [irrelevant]”

 

Under paragraph 1.1(18) a public liability claim is defined as follows:

 

“(18) “public liability claim” –

(a) means a claim for damages for personal injuries arising out of a breach of a statutory or common law duty of care made against—

(i) a person other than the claimant’s employer; or

(ii) the claimant’s employer in respect of matters arising other than in the course the claimant’s employment; but

(b) … [irrelevant]”.

 

Thus the protocol specifically envisages a claim against one’s employer as potentially being a public liability claim, and the key issue is as to whether the accident happened “in the course of employment” or “in the course of the Claimant’s employment”, or otherwise.

It is unfortunate that there are two slightly different definitions, but they amount to the same thing in my view.

The fact that something occurs outside of working hours does not of itself take the matter outside the course of employment.

For example there is considerable employment case law holding that work related social events, such as Christmas parties etc. can be in the course of employment.

On balance, I take the view that attending work by arrangement with one’s employer in order to collect one’s wages for working is indeed acting in the course of employment as it is part of the employment arrangement, that is the receipt of wages in return for the provision of work.

Likewise an accident at a work related social event.

However, a court could find otherwise.

I referred above to the Employers’ Liability and Public Liability Protocol being a single protocol.

There is no concept of there being a separate Employers’ Liability Protocol and a separate Public Liability Protocol, although it would have been easy to do so had the Rules Committee and Parliament wished to do so.

Compare and contrast that with the Road Traffic Accident Portal, which is a separate protocol in a separate portal.

When you initiate the process you are required to select one of the two protocols, that is the RTA Protocol on the one hand or the EL/PL Protocol on the other hand.

Thus an ex EL/PL Portal Claim, and will remain in, the Fixed Recoverable Costs Scheme unless and until the matter is allocated to the Multi-Track.

If the claim settles for between £1,000.00 and £5,000.00 pre-issue, the fixed costs for an Employers’ Liability and Public Liability matter are the same, that is £950.00 plus 17.5% of damages.

If it settles for between £5,000.00 and £10,000.00, then the core fee is the same, that is £1,855.00, but the percentage of damages is different.

For employers’ liability it is 12.5% of damages over £5,000.00 whereas for public liability it is 10% of damages over £5,000.00.

Thus the difference is 2.5% of the damages over £5,000.00, which is £2.50 per £100.00 or £25.00 per £1,0000.00.

In the £10,0001.00 to £25,000.00 bracket the core fee for employers’ liability is £2,500.00 as compared with £2,370.00 for public liability cases.

In each case the percentage fee is 10% of damages over £10,000.00.

There is then a greater difference, both in the core fee and the damages, as the matter progresses through the litigation stages.

A matter that has exited one portal can then be put onto the other portal, but the EL/PL portal is one single portal.

 

Consumer Protection Act claims

Section 2 of the Consumer Protection Act 1987 states:

 

(1) Subject to the following provisions of this Part, where any damage is caused wholly or partly by a defect in a product, every person to whom subsection (2) below applies shall be liable for the damage.

(2) This subsection applies to—

(a) the producer of the product;

(b) any person who, by putting his name on the product or using a trade mark or other distinguishing mark in relation to the product, has held himself out to be the producer of the product;

(c) any person who has imported the product into a member State from a place outside the member States in order, in the course of any business of his, to supply it to another.

 

Do such claims fall within the PL Portal, that is, is it a breach of a statutory duty?

By virtue of section 2 of the Consumer Protection Act, those listed have a statutory duty not to cause damage which is caused wholly or partly by a defect in a product.

The fact that it refers to three different types of people, seems to me to make no difference.

Thus, a producer of the product is in breach of the duty and so is any person who, by putting his name on the product or using a trademark or other distinguishing mark in relation to the product, has held himself out to be the producer for the product, and so is any person who has imported the product into a member State from a place outside the member States in order, in the course of any business of his, to supply to another.

Indeed it seems to me that this is far more an incident of breach of statutory duty rather than a straightforward injury.

Without the statute, that is the Consumer Protection Act, arguably those mentioned in section 2(2)(b) and (c) would have no liability.

Thus the section creates a liability on a person who puts his name to the product or imports the product etc., over and above the common law duty on the producer.

How does one plead the matter in a statement of case?

By saying “…is in breach of its duty under section 2 of the Consumer Protection Act…”?

The Portal definition is intended to be inclusive and the exclusion is contained at paragraph 1.1(18)(b) where it says that a public liability claim does not include a claim for damages arising from a disease that the Claimant is alleged to have contracted as a consequence of breach of statutory or common law duties of care, other than a physical or psychological injury caused by an accident or other single events.

Had the portal intended to exclude any other type of public liability claim, one would have expected it to do so there.

Paragraph 4.3 of the portal lists another series of exceptions, and this is not one of those exceptions, although if the matter was never potentially on the portal it does not need to be excluded.

Case law on other matters shows that it is the intention, where possible, that claims should be in the portal, rather than outside it and my view is that, on balance, a court is likely to find that this is indeed a portal claim.

A Court may take a different view.

I am grateful to Catherine Hyde of Coodes Solicitors for bringing some of the material in this piece to my attention, and also to Andrew Last of Mooneerams Solicitors.

Written by kerryunderwood

October 20, 2017 at 8:01 am

Posted in Uncategorized

FIXED COSTS EXTENSION: WHAT TO DO NOW

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I deal with Fixed Costs at length in my book Personal Injury Small Claims, Portals and Fixed Costs running to 1,300 pages and three volumes, available for £80.00 including P&P from Amazon here or me here.

Fixed Recoverable Costs: What clients need to know and what we should be telling them?

  • Consider the Track and Complexity Band for all new work up to £250,000.00.

 

  • Prepare list of issues to discuss with client.

 

  • Prepare Letter of Claim/Response as to appropriate track and band.

 

  • Make Part 36 offer on liability.

 

  • Consider Part 36 offer on quantum.

 

  • Consider appropriate arrangement with counsel

 

  • Speak to counsels’ chambers.

 

  • Study the existing FRC scheme and relevant case law.

 

  • Part 36 to be fixed percentage uplift, not open costs- how will this affect your tactics?

 

  • Learn about contingency fees and Section 57 Solicitors Act 1974.

 

  • FRC are bound to increase work significantly – plan to make a profit out of it!

 

  • Consider method of charging client.

 

  • Claimant – FRC plus percentage of damages?

 

  • Defendant  – FRC plus percentage of damages saved?

 

  • No Win Lower Fee Agreements.

 

  • ATE insurance.

 

  • Third Party Funding.

 

  • Online Courts – No costs under £25,000.00.

 

  • Go on a course.

 

Also see

FIXED COSTS REPORT OVERVIEW : POST 1

FIXED COSTS AND PART 36: POST 3

FIXED COSTS: THE FAST TRACK FIGURES: POST 4

JUDICIAL REVIEW AND FIXED COSTS: POST 5

CLINICAL NEGLIGENCE AND FIXED COSTS: POST 6

THE NEW FIXED COSTS REGIME: POST 7

Written by kerryunderwood

October 19, 2017 at 8:52 am

Posted in Uncategorized

AUTOMATIC STRIKE-OUT, COSTS AND SMALL CLAIMS

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CPR 3.7A 1(7) provides that if the trial fee has not been paid on or before the trial fee payment date, then the claim will automatically be struck out without further order of the court, and unless the court orders otherwise, the Claimant will be liable for the costs which the Defendant has incurred.

That is a draconian penalty which lawyers need to be aware of and if a claim is struck out an immediate application to reinstate should be made.

However, here I want to consider the effects of the automatic liability for payment of the Defendant’s costs, unless the court orders otherwise.

Qualified One-Way Costs Shifting

CPR 44.15 allows a Defendant to enforce “to the full extent of such orders” – that is exceeding damages, without permission of the court, where the proceedings have been struck out on the ground that –

(a) the claimant has disclosed no reasonable grounds for bringing the proceedings;

(b) the proceedings are an abuse of the court’s process; or

(c) the conduct of –

(i) the Claimant; or

(ii) a person acting on the Claimant’s behalf and with the Claimant’s knowledge of such conduct,

is likely to obstruct the just disposal of the proceedings.”

Automatic strike-out for failure to pay the trial fee is not caught by this exception and thus, although the Defendant will have a costs order in its favour against a personal injury Claimant whose claim is struck out for failure to pay the fee, the Defendant will be unable to enforce that costs order.

Small Claims

CPR 27.14 sets out the limited circumstances in which costs may be ordered in the Small Claims Track, and the circumstances set out in CPR 3.7 do not come with any of the listed exceptions in CPR 27.14.

CPR 44.9 is headed “Cases where costs orders deemed to have been made” and reads:

44.9

(1) Subject to paragraph (2), where a right to costs arises under –

(a) rule 3.7 or 3.7A1 (defendant’s right to costs where claim is struck out for non-payment of fees);

(a1) rule 3.7B (sanctions for dishonouring cheque);

(b) rule 36.13(1) or (2) (claimant’s entitlement to costs where a Part 36 offer is accepted); or

(c) rule 38.6 (defendant’s right to costs where claimant discontinues),

a costs order will be deemed to have been made on the standard basis.”

The rest of the rule does not apply to this situation.

Thus CPR 44.9 deems there to have been an order in those circumstances and, as we have seen, the strike-out is automatic.

Thus the effect of the combination of CPR 3.7 and CPR 44.9(1)(a) is that upon the non-payment of a trial fee the matter is automatically struck out and there is automatically deemed to have been a costs order made.

Thus the strike-out and the costs order occur without any judicial discretion or intervention. They are automatic.

Thus there is a clear contrast and conflict between these provisions and CPR 27.14

This issue needs clarifying as it will become of much greater importance as and when the small claims limit for personal injury rises to £2,000.00 generally and £5,000.00 in relation to road traffic accident matters.

The general small claims limit is already £10,000.00 and under the Briggs Reforms is proposed to rise to £25,000.00.

I am grateful to Alex Williams of Oriel Chambers for bringing this to my attention.

Written by kerryunderwood

October 18, 2017 at 7:50 am

Posted in Uncategorized

INDEMNITY COSTS DUE TO EXPERTS’ CONDUCT

with 2 comments


In The Governors and Company of the Bank of Ireland (1) and Bank of Ireland (UK) PLC (2) v Watts Group PLC [2017] EWHC 2472 (TCC)

the Technology and Construction Court ordered that the costs incurred as a result of the conduct of the Claimant’s expert be assessed on the indemnity basis.

The court said that it was particularly critical of the Claimant’s expert quantity surveyor who gave evidence on behalf of the bank and had “grave concerns about his evidence.”

The court took the opportunity to review the case law in relation to conduct so bad that it warrants indemnity costs orders.

The court concluded that there is authority for the proposition that where a court concludes that the conduct of an expert should be marked in the Costs Order, it may be appropriate to order that the specific costs generated by that expert should be assessed on an indemnity basis – see

Balmoral v Borealis [2006] EWHC 2531 (Comm) and

Williams v Jervis [2009] EWHC 1837 (QB).

“Accordingly, I consider that the costs of the Defendant’s QS expert, Mr Whitehead, should be assessed on an indemnity basis, as should the costs of and occasioned by Mr Vosser’s oral evidence at the trial.”

Comment

There is a view that experts have got away with it as far as the extension of fixed costs is concerned, as, alone, their costs remain unfixed and uncapped.

However, there is increasing evidence that the courts are looking at experts’ fees and conduct much more closely than in the past.

Written by kerryunderwood

October 17, 2017 at 9:06 am

Posted in Uncategorized

DISCLOSURE CUT BY 90% BY COMMERCIAL COURT

with 3 comments


In Bank Mellat v Her Majesty’s Treasury [2017] EWHC 2409 (Comm)

The Commercial Court, part of the High Court, considered the appropriate order for disclosure in respect of “affected transactions” identified by the claimant bank.

At an earlier hearing it was thought that the number of “affected transactions” might run into tens of thousands, with the idea that disclosure should only be given in respect of limited, agreed sample transactions.

A schedule subsequently prepared by the claimants identified 2,500 affected transactions.

Mr Justice Males noted that the parties’ expert accountants had been unable to agree an approach to sampling.

The defendants argued that the claimant should be required to give disclosure on all of the transactions it relied on, so that the claim could be “properly tested”, whilst the claimant bank pointed to the “extremely onerous and expensive task” that that would involve, possibly taking over a year, and costing at least £2 million.

The claimant proposed that there should be disclosure in respect of 10% of the transactions in the schedule, selected at random.

Mr Justice Males concluded that, due to the inevitable impact of ordering full disclosure, the sample approach was one that should be attempted.

He noted, though, that this was a very substantial claim and, if the transactions were to be relied on, reliable evidence had to be given.

Therefore, he made the order for sample disclosure on that basis that, once the material had been disclosed and considered, further disclosure might be required.

This is yet another example of the court restricting, or criticising, the volume of documents in litigation, with parties sticking to the outdated concept of standard disclosure, which will shortly be scrapped for virtually all cases worth less than £100,000.

Due to concerns over the huge costs generated by the disclosure process, a working group chaired by Lady Justice Gloster is considering possible procedural reforms in all cases.

Written by kerryunderwood

October 16, 2017 at 8:19 am

Posted in Uncategorized

SOLICITORS ORDERED TO PAY COSTS OF FALSE CLAIM

with 8 comments


In Trehan v Liverpool Victoria Insurance Company Ltd (unreported), 3 October 2017, Nottingham County Court

a firm of solicitors, deceived by a fraudster into pursuing a fraudulent personal injury claim, was ordered to pay all the defendant insurer’s costs, and the costs of an application by the person whose name was fraudulently used as claimant, under the court’s section 51 wasted costs jurisdiction.

The fraudster, the director of a claims referral company, was also jointly and severally ordered to pay costs under the non-party costs jurisdiction.

The claim had been made without the claimant’s knowledge or authority.

The director deceived the solicitors by forging the claimant’s signature on a number of documents, but the solicitors had also behaved reprehensibly by failing to conduct basic client checks and by dating letters incorrectly to hide non-compliance with court rules.

The judge said that, in terms of the professional standards required of a solicitors’ practice, their conduct was appalling, and he refused the solicitors’ claim for indemnification from fraudster.

As between the solicitors and the fraudster, the judge apportioned costs one third to the solicitors and two thirds to the fraudster.

 

Written by kerryunderwood

October 13, 2017 at 8:39 am

Posted in Uncategorized

CLINICAL NEGLIGENCE AND ATE PREMIUMS: A SUITABLE CASE FOR TREATMENT

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In Mitchell v Gilling-Smith [2017] EWHC B18 (Costs)

the Senior Courts Costs Office upheld recovery of an After the Event Insurance Premium of £10,000.00 plus Insurance Premium Tax (IPT) in a clinical negligence case, where such premiums remain recoverable, but only in relation to the risk of incurring a liability to pay for reports relating to reliability or causation.

The total premium was £13,500.00 plus IPT, split into £10,000.00 covering the cost of experts’ reports and just £3,500.00 to cover all other disbursements and adverse costs.

At the time of settlement, the actual cost of the report was £2,000.00, so the Defendant had to pay that sum and five times as much for the insurance to cover that sum.

The Costs Master said that this premium “could not be characterised as disproportionate in a clinical negligence claim that settled for £200,000.00”.

That makes no sense at all. The proportionality test must relate to the disbursement and what it covers.

The logic of this is that in a big claim one could spend, say, £10.00 on a cup of coffee at court or whatever.

I am no fan of the National Health Service Litigation Authority, or Resolution, or Sellafield, or whatever it is now called, nor of its lawyers, but this is absurd and is a waste of money that could be spent on medical treatment.

Who, out of their own money, and not out of their mind, would pay £10,000.00 to insure £2,000.00?

How can the cost of insuring the risk of all other disbursements and adverse costs be only around one-third of the cost of insuring the medical reports?

This brings the clinical negligence sector into disrepute and is one of the drivers for the move towards fixed costs for all clinical negligence actions of all kinds.

The obvious answer is for the NHS to provide an expert at no charge.

Even taking into account cases which do not succeed or proceed, this would be far cheaper for the NHS and would give greater access to justice and prevent insurance companies taking NHS money.

Written by kerryunderwood

October 12, 2017 at 10:27 am

Posted in Uncategorized

THE NEW PRE-ACTION PROTOCOL FOR DEBT CLAIMS

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By Anna Patsalides, Solicitor, Underwoods Solicitors

On 1 October 2017, a new pre-action protocol for debt claims came in to force which can be found here.

The Protocol describes how the court expects parties to act before legal proceedings are commenced.

This will apply to business creditors seeking to recover debt from an individual or a sole trader.

The new protocol increases the amount of work which a creditor must do, even in a simple debt claim.

The changes in the protocol will mean that the court will be able to look at both parties behaviour before a case is issued at court.

The purpose of the new pre-action protocol is to encourage parties to communicate and for information to be exchanged at an early stage to avoid the need for court proceedings.

The aim of the new changes is to keep costs down so that they are reasonable and proportionate to the debt in question.

The New Procedure

Before this protocol came in to force there was no specific procedure outlined for debt claims and they would fall under the general pre-action protocol.

The protocol provides that a creditor must now issue a letter of claim to the debtor before any legal proceedings are commenced and that the creditor must provide mandatory information. This should include:

  • The amount of debt due as well as any interest and any charges applied.

 

  • Full details of the written or oral agreement which was entered into by the debtor and creditor.

 

  • The option for the debtor to request a copy of any written agreement.

 

  • In the event that the debt has been assigned the letter of claim must provide the details of that assignment.

 

  • If instalments are being paid against the debt but the creditor believes that the current arrangement is unacceptable, an explanation for this should be provided.

 

  • An information sheet and reply form.

 

There is also now a new requirement that the letter of claim must be posted on the day on which it is dated and signed or if that is not reasonably possible, posted the following day.

Response to claim

The debtor should respond to the claim within 30 days. This is in contrast to the previous guidance which provided for a response within 14 days or at the very most 21 days.

There is a prescribed form set out in Annex 1 to the protocol which should be used. There are some tick box options to which the debtor can either agree or disagree to all or part of the claim and state whether they are in a position to make a payment.

If a debtor indicates that they are seeking advice, creditors must then allow a reasonable period of time for that advice to be obtained.

Under the new protocol, the creditor must not commence legal proceedings within 30 days following receipt of the completed reply form.

Where the debtor admits the debt but requires time to pay, the parties should try and reach an agreement for the debt to be settled based on the debtor’s income and expenditure. If the creditor refuses a debtor’s proposals then they must provide reasons for this.

The parties are now also under an obligation to take steps to try and resolve matters without court proceedings and should consider alternative dispute resolution.

Where parties have been unable to reach an agreement, the creditor should give the debtor at least 14 days’ notice of their intention to issue court proceedings.

Sanctions for failure to comply

If a party fails to comply with the protocol and proceedings are issued, the court can take this into consideration when giving directions. This could result in a stay of proceedings to allow for parties to enter into communications.

In exceptional cases, the court may also impose cost sanctions against non-complying parties.

What does this mean for creditors?

Creditors need to adapt their own debt collection procedures.

Their letter of claim is likely to have to be longer and include more detailed information than before.

The letter of claim should be sent by post even if the creditor has additional contact details for the debtor, such as an email address.

The only time in which a creditor is not required to do this is if the debtor has specifically asked that correspondence should not be sent by post and has provided an alternative method.

Compared to the existing practice, from the time the letter of claim is sent until the commencement of court proceedings, it is likely to increase from an average of 2 weeks to 30 days and this could even increase up to 74 days where legal advice is sought or discussions are entered into.

The protocol does state that courts will not be unduly concerned with minor or technical breaches, especially if the matter is urgent but they will have the power to consider breaches of the protocol and impose sanctions.

Comment

At first glance it might appear that the changes will significantly weaken the position of a business claiming a debt, as the guidance puts a greater burden on creditors to provide historical information.

My view is that creditors will be more determined to issue court proceedings and the changes to the protocol will simply result in businesses seeking legal advice at an earlier stage.

Creditors will no doubt tighten up their internal processes so that it becomes harder for an individual to borrow money or get credit.

Whilst the aim of the Protocol may have been to reduce litigation and provide extra protection for consumers I think the reality is more bureaucracy, more costs and more litigation.

Written by kerryunderwood

October 10, 2017 at 1:47 pm

Posted in Uncategorized

PART 36 AND INDEMNITY COSTS

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I am organizing, chairing, and speaking at a Part 36 Conference in Central London on Tuesday 14 November with Ben Williams QC and David Pilling. For more information, or to book, click here.

In The Governors and Company of the Bank of Ireland (1) and Bank of Ireland (UK) PLC (2) v Watts Group PLC [2017] EWHC 2472 (TCC)

a High Court Judge refused to make an order for indemnity costs in circumstances where the Claimant failed to beat the Defendant’s offer.

That must be right.

However the court referred to the fact that where a Claimant fails to beat a Defendant’s Part 36 offer then, unlike a successful Claimant, there is no automatic entitlement to indemnity costs.

The court observed:

“I know this misalignment is considered by some to be unjustified, but it remains the law.”

With respect to the judge, that shows a misunderstanding of the true position.

Where a Claimant fails to beat a Defendant’s offer, but nevertheless wins the case, the Claimant is punished twice.

Firstly it does not receive any costs from the date of expiry of the Defendant’s Part 36 offer, even though it has won the case.

Secondly it has to pay the Defendant’s costs on the standard basis from the date of expiry of the offer which it failed to beat.

Thus the double penalty on the Claimant is that they are having to pay part of the costs of the action, and are being deprived of part of the costs of the action, even though they have won the case.

A Claimant who beats its own offer would have no incentive to make an offer without the award of indemnity costs, as it would recover costs in any event as the winner of the action.

If a Defendant was to get indemnity costs when its own offer was not beaten, then the logic would be that a Claimant would get indemnity costs when it beats the Defendant’s offer, and that has not happened.

Some judges seem never to have got to grips with the idea of Claimants’ Part 36 offers.

Written by kerryunderwood

October 10, 2017 at 10:44 am

Posted in Uncategorized

ACCEPTING A PART 36 OFFER DURING TRIAL

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I am organizing, chairing, and speaking at a Part 36 Conference in Central London on Tuesday 14 November with Ben Williams QC and David Pilling. For more information, or to book, click here.

CPR 36.11(3)(d) states that the court’s permission is required to accept a Part 36 offer once a trial is in progress.

In Houghton (Stanley) v P.B.Donoghue (Haulage & Plant Hire Ltd and Others) [2017] EWHC 1738 (CH)

the Chancery Division of the High Court refused to allow a party to accept an outstanding Part 36 offer during the trial.

During the course of litigation the Defendant had made an unwithdrawn Part 36 offer of £360,000.00.

After two days of evidence at the trial, the Claimant applied for permission to accept that Part 36 offer and the Defendant objected.

The judge said:

“I think that the philosophy exists that where a Claimant decides to take his chances with the trial and then repents of his earlier decision to turn down the offer of settlement because the trial, he thinks, is going less well or more badly than predicted, that the court will often take the view that it is not right to give permission to impose a settlement on the reluctant Defendant.”

The court here reviewed the authorities in coming to that conclusion and in particular considered the cases of:

  • Capital Bank Plc v Stickland [2005] 1 WLR 3914;

 

 

 

Although those authorities were given under earlier versions of Part 36, the principles remained the same.

Here the judge said that what he was being asked to do was to impose upon the Defendant a liability to pay £360,000.00, which he was no longer willing to do because it had asked the court to refuse permission.

The Defendant now wished to take its chances with the trial continuing, so the court is imposing a result, imposing a settlement which is not a voluntary settlement any longer.

It is clear that the rules require the court’s permission in such circumstances.

However, the Defendant’s remedy is to withdraw the offer.

In circumstances such as this, the Defendant is eating its cake and still having it, in that it can argue the case, prevent the Claimant from accepting the offer, but still get the very significant costs benefit if the Claimant fails to beat that offer.

The law needs reviewing in this area.

Written by kerryunderwood

October 10, 2017 at 8:54 am

Posted in Uncategorized

SIGNING SOLICITORS’ BILLS

with 2 comments


The relevant legislation is Section 69 of the Solicitors Act 1974 and the signature requirements are dealt with in Section 69 (2A) which reads:

“(2A) a bill is signed in accordance with this subsection if it is –

(a) signed by the solicitor or on his behalf by an employee of the solicitor authorized by him to sign, or

(b) enclosed in, or accompanied by, a letter which is signed as mentioned in paragraph (a) and refers to the bill.”

 

There is no further reference to authorization and thus that is entirely an internal matter and, in my view, as a matter of common law and general construction that authorization could be retrospective.

Certainly the client does not need to be informed that that employee is authorized by the solicitor to sign bills.

Section 69 (2A)(b) goes further and states that the bill is signed in accordance with the subsection if the bill is enclosed in, or accompanied by, a letter which is signed by the solicitor or by an employee of the solicitor authorized by him to sign.

For all intents and purposes the bill can be signed by anyone.

Section 69(2)(b) also requires the bill to be delivered in accordance with Section 69(2)(C) and that section reads:

 

“(2C) a bill is delivered in accordance with this subsection –

(a) it is delivered to the party to be charged with the bill personally;

(b) it is delivered to that party by being sent to him by post to, or left for him at, his place of business, dwelling house or last known place of abode, or

(c) it is delivered to that party –

(i) by means of an electronic communications network, or

(ii) by other means but in a form nevertheless requires the use of apparatus by the recipient to render it intelligible,

and that party has indicated to the person making the delivery his willingness to accept delivery of a bill sent in the form and manner used.

 

That last part appears to me to apply to both Section 69(2C)(c) (i) and (ii) and thus there is a requirement that the recipient of the bill has indicated willingness to accept delivery by email or in any other non-personal or non-postal form.

Section 69(2D) then provides that any indication given under Section 69(2C)(c) must state the address to be used and must be accompanied by such other information that person requires for the making of the delivery and may be modified or withdrawn at any time by a notice given to that person.

Section 69(2E) creates a statutory presumption that where a bill is proved to have been delivered in compliance with the requirements of sub-sections (2A) and (2C), it is not necessary in the first instance for the solicitor to prove the contents of the bill and it is to be presumed, until the contrary is shown, to be a bill bona fide complying with the Act.

Overall that represents a major relaxation of the earlier law.

Section 69(5) provides that references to an electronic signature are to be read in accordance with Section 7(2) of the Electronic Communications Act 2000. Section 69(6) provides that “Electronic Communications Network” has the same meaning as in the Communications Act 2003.

Section 7 of the Electronic Communications Act 2000 reads as follows:

“7.          Electronic signatures and related certificates.

(1) In any legal proceedings—

(a) an electronic signature incorporated into or logically associated with a particular electronic communication or particular electronic data, and

(b) the certification by any person of such a signature, shall each be admissible in evidence in relation to any question as to the authenticity of the communication or data or as to the integrity of the communication or data.

(2) For the purposes of this section an electronic signature is so much of anything in electronic form as—

(a) is incorporated into or otherwise logically associated with any electronic communication or electronic data; and

(b) purports to be used by the individual creating it to sign.

(3) For the purposes of this section an electronic signature incorporated into or associated with a particular electronic communication or particular electronic data is certified by any person if that person (whether before or after the making of the communication) has made a statement confirming that—

(a) the signature,

(b) a means of producing, communicating or verifying the signature, or

(c)a procedure applied to the signature, is (either alone or in combination with other factors) a valid means of signing.”

The Communications Act 2003 has no fewer than 411 Sections and 19 Schedules and, happily, I do not think it necessary to make any further reference to it in this short advice.

Written by kerryunderwood

October 9, 2017 at 9:39 am

Posted in Uncategorized

EMPLOYMENT TRIBUNALS AND SIMMONS V CASTLE 10% UPLIFT

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In De Souza v Vinci Construction (UK) Limited [2017] EWCA Civ 879

the Court of Appeal held that in Employment Tribunal awards for personal injury and injury to feelings, both of those types of award attracted the 10% general damages uplift arising from the Court of Appeal’s decision in Simmons v Castle [2013] 1 ALL E.R 334.

That uplift had been intended to compensate partially Claimants for the fact that they could no longer recover the success fee from the Defendant and would generally have to pay that element of costs to their own solicitor out of damages.

The Court of Appeal in Simmons made it clear that this uplift applied even in circumstances where the client would not in fact have to pay anything out of damages, for example a legally-aided client.

Such clients would receive a windfall, but that was the price to pay for unification and consistency of general damages awards.

Generally no costs are recoverable in Employment Tribunals and so Claimants would not lose out by the loss of recoverability as there has never been recoverability in that forum.

Here, the Court of Appeal held that Section 124(6) of the Equality Act 2010 meant that the amount awarded by an Employment Tribunal for a particular head of loss must be the same as if an award for the same loss had been made in the County Court.

It would be unacceptable for compensation to be different depending upon which part of the Equality Act 2010 applied, that is whether the claim was in the Employment Tribunal or the County Court.

The Court of Appeal observed that no problem should arise in relation to damages for psychiatric injury as the Judicial College Guidelines could incorporate the uplift.

The position was different in relation to awards for injury to feelings, but the same effect could be achieved by applying the uplift to the Vento Bands set out in

Vento v Chief Constable of West Yorkshire Police [2003] IRLR 102.

Written by kerryunderwood

October 5, 2017 at 9:06 am

Posted in Uncategorized

STREAMLINED PROCEDURES

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I am currently on my Autumn Tour on the extension of fixed costs as proposed by Lord Justice Jackson and associated matters until Monday 16 October and these will be my only courses on this subject until at least September 2018.

You can book here.

All of these matters are dealt with in my new book – Personal Injury Small Claims, Portals and Fixed Costs, running to three volumes and 1,300 pages and costing £80.00 and available from me here or Amazon here.

I have written elsewhere about the streamlined procedure in the new Intermediate Track – See THE NEW INTERMEDIATE TRACK: SCOPE AND PROCEDURE.

However, it is clear that the judiciary in England and Wales has made a deliberate policy decision strictly to limit the production of documents and skeleton arguments in virtually all cases.

The Commercial Court Pilot for claims up to £250,000.00 has a streamlined procedure and that itself reflects the Shorter Trial procedure.

Even where those special procedures do not apply, the courts are becoming increasingly critical of over-long skeleton arguments, core bundles and the “grossly excessive volume of documentation.”

This is a very welcome move and is in sharp contrast to the position in most states of the United States of America where document disclosure and inspection can cost a fortune and paralyse the judicial process.

Here are quotes from three recent decisions which give a flavour of the attitude of the courts here.

 

In ICAP Management Services Ltd v Berry & Anor [2017] EWHC 1321 (QB)

the court said:

“In advance of the hearing, I had received skeleton arguments from all three parties. Paragraph 12.3.8 of the Queen’s Bench Guide sets out the requirements for a skeleton argument. It provides that skeleton arguments should “not normally be longer than twenty pages of doubled spaced A4 paper”. Converting the skeleton arguments in this case to that format produces a skeleton argument from the claimant of 151 pages, plus 35 pages of appendices. For the first defendant the figure was 158 pages, plus eight pages of appendices; for the second defendant the figure was 51 pages, plus six pages of appendices. There was, in fact, no significant issue between the two defendants; the provision of two separate skeletons of such length making similar points was singularly unhelpful.

This was a case with a time estimate of six days including two days for pre-reading. The issue at stake was the enforcement of the terms of an employment contract for something less than three months. The overriding objective, set out in CPR 1.1(2), directs the court to ensure that cases are dealt with “justly and at proportionate cost”. That includes allotting to the case “an appropriate share of the court’s resources”. As I made clear to the parties at the commencement of this hearing, skeleton arguments of the length described above, in a case such as this, are inconsistent with that overriding objective. The skill in drafting a skeleton argument lies in the production of a concise outline of the essential elements of the argument which is to be developed orally in court.

It is evident that the authors of the skeletons in the present case were proceeding on the assumption that they could demand of the court such judicial time as they thought necessary. In that they were mistaken. The length of the written argument means that the vast bulk of such pre-reading time as was allowed had to be devoted to reading them, rather than underlying documents. In fact, in this case, the length and complexity of the written argument served to obfuscate the real issues in the case. In truth, these were not skeleton arguments at all; the arguments contained in these documents were fully fleshed out and dressed in much unnecessary finery.

I indicated at the beginning of these proceedings that I was minded to disallow a substantial part of the costs of preparing the skeleton arguments. I will, of course, hear submissions on that issue, but that remains my preliminary view.

In addition to the excessive skeleton arguments, I was presented with a grossly excessive volume of documentation. The primary bundles for use in court ran to 13 volumes. I also received a further 44 lever arch files of allegedly confidential documentation. Of the 14,000 pages of documentation in the confidential files, I was referred at the hearing to less than 100. I was also provided with six volumes of authorities.

The provision of that sort of volume of material in a four day case is absurd. It too is contrary to the overriding objective. It betrays a failure by those acting for all the parties to adopt a sensible and constructive approach to preparation. My current view, again subject to submissions at the handing down of this judgment, is that a substantial part of the costs of producing or agreeing this vast quantity of material should also be disallowed.”

 

In Network Rail Infrastructure Ltd, R (On the Application Of) v The Secretary of State for the Environment, Food And Rural Affairs [2017] EWHC 2259 (Admin)

the court said:

“I regret the need to have to make some observations on the inappropriate manner in which the claim was put before the court. I do so in order to make it plain to litigants that the practices that were followed in this case, and regrettably sometimes in others, are not acceptable. Notwithstanding the clear statement by Sullivan J (as he then was) in R (Newsmith Stainless Ltd) v Secretary of State for Environment, Transport and the Regions [2001] EWHC (Admin) 74 at paragraphs 6-10, this claim was accompanied by six volumes comprising over 2,000 pages of largely irrelevant material. The Claimant’s skeleton argument was long, diffuse and often confused. It also lacked proper cross-referencing to those pages in the bundles which were being relied upon by the Claimant. The skeleton gave little help to the court.

Shortly before the hearing the court ordered the production of a core bundle for the hearing not exceeding 250 pages. During the hearing, it was necessary to refer to only 5 or 6 pages outside that core bundle. Ultimately, as will be seen below, the claim succeeds on one rather obvious point concerned with the effect of the Grampian condition in the 2016 permission. But this had merely been alluded to in paragraph 76 and the first two lines of paragraph 77 of the skeleton. Indeed, the point was buried within the discussion of Ground 3 of the claim, a part of the Claimant’s argument to which it does not belong. Nevertheless, Mr Tim Buley, who appeared on behalf of the Defendant, acknowledged that he had appreciated that this point could be raised. He was ready to respond to it.

Certainly, for applications for statutory review or judicial review of decisions by Planning Inspectors or by the Secretary of State, including many of those cases designated as “significant” under CPR PD 54E, a core bundle of up to about 250 pages is generally sufficient to enable the parties’ legal arguments to be made. In many cases the bundle might well be smaller. Even where the challenge relates to a decision by a local planning authority, the size of the bundle need not be substantially greater in most cases.

Prolix or diffuse “grounds” and skeletons, along with excessively long bundles, impede the efficient handling of business in the Planning Court and are therefore contrary to the rationale for its establishment. Where the fault lies at the door of a claimant, other parties may incur increased costs in having to deal with such a welter of material before they can respond to the Court in a hopefully more incisive manner. Whichever party is at fault, such practices are likely to result in more time needing to be spent by the judge in pre-reading material so as to penetrate or decode the arguments being presented, the hearing may take longer, and the time needed to prepare a judgment may become extended. Consequently, a disproportionate amount of the Court’s finite resources may have to be given to a case prepared in this way and diverted from other litigants waiting for their matters to be dealt with. Such practices do not comply with the overriding objective and the duties of the parties (CPR 1.1 to 1.3). They are unacceptable.

The Court has wide case management powers to deal with such problems (see for example CPR 3.1). For example, it may consider refusing to accept excessively long skeletons or bundles, or skeletons without proper cross-referencing. It may direct the production of a core bundle or limit the length of a skeleton, so that the arguments are set out incisively and without “forensic chaff”. It is the responsibility of the parties to help the Court to understand in an efficient manner those issues which truly need to be decided and the precise points upon which each such issue turns. The principles in the CPR for dealing with the costs of litigation provide further tools by which the Court may deal with the inappropriate conduct of litigation, so that a party who incurs costs in that manner has to bear them.”

 

In Miley v Friends Life Ltd [2017] EWHC 2415 (QB)

the Queen’s Bench Division of the High Court said:

“I would wish, at this early stage, to repeat an observation I have made in earlier cases in which I have been required to consider and adjudicate on very substantial quantities of material which have, in turn, given rise to lengthy oral and written representations. The parties in this case have produced opening and closing written submissions which run to a very substantial length indeed and all of which I have read carefully. As I remarked in Laporte v The Commissioner of Police of the Metropolis [2015] 3 All E.R. 438 at paragraphs 2 and 3:

“2…Whilst paying tribute to the level of industry to which these well intentioned and articulate submissions attest I resist the temptation to try to reconcile and resolve all of the subordinate issues which have thereby been generated. As the Court of Appeal held in Customs and Excise Commissioners v A and Another [2003] Fam 55:

 

“82. A judge’s task is not easy. One does often have to spend time absorbing arguments advanced by the parties which in the event turn out not to be central to the decision-making process…

83. However, judges should bear in mind that the primary function of a first instance judgment is to find facts and identify the crucial legal points and to advance reasons for deciding them in a particular way. The longer a judgment is and the more issues with which it deals the greater the likelihood that: (i) the losing party, the Court of Appeal and any future readers of the judgment will not be able to identify the crucial matters which swayed the judge; (ii) the judgment will contain something with which the unsuccessful party can legitimately take issue and attempt to launch an appeal; (iii) citation of the judgment in future cases will lengthen the hearing of those future cases because time will be taken sorting out the precise status of the judicial observation in question; (iv) reading the judgment will occupy a considerable amount of the time of legal advisers to other parties in future cases who again will have to sort out the status of the judicial observation in question. All this adds to the cost of obtaining legal advice.

84. Our system of full judgments has many advantages but one must also be conscious of the disadvantages.”

3. I have tried to balance those advantages and disadvantages in what follows by giving reasoned decisions on those issues of fact which I consider to be central but without dealing with every peripheral issue the resolution of which would not in any event impact on my essential findings or upon the outcome of the claims.”

Those observations apply with equal force to the present case.”

Later on in the judgment the court said:

“The volume of material involved, spanning as it does a number of years, is very considerable indeed. It is in this case, as it was in Laporte, a tribute to the industry of the legal teams on each side that this large body of evidence has been subjected to such sedulous analysis in both oral and written submissions. However, there is a risk in cases such as this that too close a scrutiny of the trees risks losing sight of the wood. With each, and ever more closely observed, layer of inspection and analysis, the law of diminishing returns takes a heavier toll.

It is for this reason that I have resisted the temptation to rehearse and resolve every issue of primary fact which has arisen; concluding that the demands of both justice and clarity are best served by an analysis involving a more generic and broader textured approach. The parties can, however, remain confident that where I have not made express reference to any given issue it is because I have considered it unnecessary to resolve that issue before reaching my central and essential conclusions on the evidence as a whole.”

 

Also see:

THE NEW INTERMEDIATE TRACK: SCOPE AND PROCEDURE

FIXED COSTS PILOT

EXTENDED FIXED COSTS PILOT SCHEME

IPEC, FIXED COSTS AND REFUSAL TO TRANSFER CASE TO HIGH COURT

Written by kerryunderwood

October 4, 2017 at 8:30 am

Posted in Uncategorized

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