Kerry Underwood

PORTAL MISTAKE BINDING: OUTRAGEOUS AND SHAMEFUL DECISION

with 10 comments


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

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.

 

In

Mahoney v Royal Mail, Truro County Court, 26 May 2020

a Deputy District Judge ruled that a personal injury claimant who had mistakenly settled a claim on the portal for £550, rather than £5,550, was bound by that error, even though in any case outside the portal system the common law doctrine of mistake would have allowed the claimant to avoid the consequences of the mistake.

The defendant was very well aware of the mistake as it had offered £4,000 and so knew that the claimant responding with an offer of just £550, rather than £5,550, was an error.

Nevertheless the Royal Mail, itself subject in other proceedings to stinging criticism, exploited the position and promptly accepted the offer.

The solicitors for the claimant realized the mistake and contacted the solicitors for the Royal Mail to attempt to withdraw the offer and return the money, including sending a cheque back, but the solicitors for Royal Mail refused to accept the cheque and maintained that the matter had been compromised when it accepted the claimant’s offer on the portal.

The claimant issued Part 7 proceedings to re-start the claim and the Royal Mail sought to have the claim struck-out, relying on similar cases such as Fitton v Ageas, where the court found that the doctrine of mistake did not apply to portal claims.

The Circuit Judge there said that although this might lead to “rough justice” on occasion, the overall benefits of the system far outweighed the negative.

By the way “rough justice” means no justice and injustice, and is a weasel phrase unworthy of any members of the judiciary.

The District Judge here, in a bizarre decision for someone charged with administering something approaching justice if possible, held that it did not matter that the defendant knew that the claimant had made a mistake, and nor did the magnitude of the mistake matter – it was “neither here nor there”.

Well, for the claimant of course it was “here or there”.

The claim was struck-out.

The judge gave an example of where an offer of £25,000 was made instead of £25 and said that the cost of rectifying the error, that is issuing proceedings, would exceed the costs of the mistake.

The difference there is £24,975. I was unaware that the portal and fixed costs scheme in Cornwall had costs exceeding that sum.

From now on we should all make a stampede down to Cornwall, lockdown restrictions permitting, to recover fixed costs of over £25,000 and to test our eyesight at the same time.

On its website Crown Office Chambers report this case as “A v B”.

No restricted reporting order was made, and nor could it be in a case such as this, and everyone else is reporting the defendant as the Royal Mail, well known to be heavily involved in highly controversial legal proceedings elsewhere.

Is it the case that the lawyers who represented the Royal Mail did not want it to know that it was the Royal Mail who behaved in this way?

 

Comment

An outrageous decision which shames our judicial system.

Do courts want the sort of scenes we are seeing on the streets of the United States to occur in the United Kingdom? If you say that what happened to George Floyd is vastly more serious than this, then you are right, but the significance is in the loss of trust in the judiciary, Parliament and the establishment to treat all equally.

The Court of Appeal should strike these judgments down with ferocity and with the severest criticism.

To seek to justify the decision by the fact that the cost of rectifying the error might exceed the cost of the mistake is ludicrous; let’s all save a few bob by scrapping the courts and having summary execution.

Firstly – surely it is more important that justice is done than a few pounds saved.

Secondly – if the message went out to parties that an obvious error would be rectified, then parties would not act in the way that the Royal Mail did here, and the cost of putting it right would be one email – that is around £15 for a junior fee earner.

In any event, how does it save money? The claimant will presumably sue the solicitors in negligence, with all of the costs that that involves.

This decision was made during a nationwide lockdown.

The relevance of that is that the Prime Minister’s most senior adviser can break the law with impunity with no consequences but one of the plebs loses £5,000 because of a typing error that any of us could make.

In any event, if the cost of rectification argument is a legitimate one, then why does it not apply to any other form of legal proceedings outside the portal system?

One law for the plebs, one for the rest.

What is the moral difference between accepting an offer that you know has been made by mistake, thus avoiding paying the proper sum, and the fundamental dishonesty of a claimant exaggerating a claim to try and get more?

 

Remedies

  1. Extend the Civil Procedure Rules to Cornwall, especially CPR 1.3;

        “The parties are required to help the court further the overriding objective.”

  1. Make it compulsory to spell out the amount, that is “five hundred and fifty pounds” and that any offer has to be typed in twice, just like a password, to avoid such a mistake, with Portal software be written to pick up an obvious error, e.g. a claimant offering to accept, as here, less than the defendant had offered, or a defendant offering to pay more than a claimant had offered to accept.

          It is common when filling out a form online for the software to say something like “Did you really mean           that?

  1. A short Act of Parliament stating that any court must take into account an obvious error and apply the common law doctrine of mistake in all cases.
  2. Mass legal tourism to Cornwall, where apparently fixed recoverable costs in the portal are over £25,000.
  3. Compare and contrast the behaviour here with leaving a briefcase on a train and lying to your employer about it, resulting in you being struck off.
  4. Consider whether the legal establishment, responsible in this case and Denton, for causing enormous worry to legal workers should stop bleating about its concerns for the mental health of young lawyers.
  5. Consider what will happen next year when many on the portal will be Litigants in Person.
  6. Consider whether the portal injustices outweigh its usefulness and whether it should now be scrapped.

Written by kerryunderwood

June 5, 2020 at 12:04 pm

Posted in Uncategorized

10 Responses

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  1. I am broadly in agreement, but what about mistake and Part 36? My understanding is that if a Part 36 offer is made in error, and accepted before it is withdrawn, that is the end of the matter also. I have had this happen a couple of times – once with an offer of £10k on a claim that was clearly worth about a tenth of that – I accepted it obviously, but I also agreed not to enforce settlement when the other side realised their error and we agreed a proper figure; the other time the offer was maybe 20% above my top valuation, and was an odd figure including some pence rather than the usual round figure for an injury claim; nevertheless I took the view that it was designed to end the claim immediately and that the odd amount included some interest. I accepted it. The other side came back a day later to say they had mistakenly included an insurer’s outlay in the offer, which was not pleaded and which had been paid pre-issue without me ever knowing about it. I stuck to my guns on that one; they applied and lost.

    David Van Der Burg

    June 5, 2020 at 12:19 pm

    • David

      Many thanks. Yes, your analysis of Part 36 is correct, but two wrongs do not make a right.

      The problem arises when courts take it upon themselves to decide that something is a ”self-contained code” which roughly translates as ”oh goodie – we can ignore a thousand years of common law evolution.’’

      The problem with modern self-contained codes like Part 36 and the portals is that they have not been tested, and issues and ambiguities are bound to occur, and that is precisely where common law principles would be invaluable in assisting in the interpretation of these codes.

      There is the additional point that they appear to have been written by nursery age children in lockdown.

      Kerry

      kerryunderwood

      June 5, 2020 at 4:32 pm

  2. I agree with everything you say here Kerry, and it did need saying. If we’re stuck with the portal then at the very least the software needs substantial overhaul. I’ve often thought that it was designed to be unhelpful and for the benefit of Defendants. It’s an outrage that the common law can be disapplied in the
    portal. Claimants and their lawyers are treated like unworthy scroungers from the public purse. Defendants and their insurers are not the public purse.Their conduct never truly faces the scrutiny it should.

    Rod Dutton

    June 5, 2020 at 12:27 pm

    • Thank you Rod, and I agree entirely.

      It will be chaos when Litigants in Person are allowed onto the portal. At least a Claimant who has a Solicitor who makes the mistake can sue the Solicitor, whereas a Litigant in Person who makes a mistake is stuffed.

      Many thanks for your comment.

      Kerry

      kerryunderwood

      June 5, 2020 at 1:52 pm

  3. Hi Kerry,

    Many thanks for this great post.

    I was also thinking about your penultimate point regarding litigants in person.

    The Claimant here at least has the benefit of being able to pursue her solicitors. A LIP will have no such fall back and I can only imagine the dread when they are told that their claim which was valued at £25,000 has been compromised at £25 and it’s his/her error and there’s nothing that he/she can do.

    Fundamental honesty is another great point too – it seems it’s only Claimants who can be subjected to this.

    Rule of law eh! Only for the plebs, never the establishment or those with deep pockets.

    Stay safe and well and please keep these posts coming.

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    Faqir Nawaz

    June 5, 2020 at 2:06 pm

    • Many thanks. I agree and I think that as soon as Litigants in Person start making mistakes and losing out to insurance companies, when they have been the victims of accidents, the attitude of the judiciary will have to change.

      There also needs to be severe penalties on Defendants in personal injury matters who are guilty of fundamental dishonesty – I have in the past suggested double damages; it is definitely not a level playing field at present.

      Stay safe yourself, and thank you for your kind remarks.

      Kerry

      kerryunderwood

      June 5, 2020 at 4:01 pm

  4. This does cut both ways on Claimants and Defendants. I’ve even had two claims listed together where both C & D had each made a mistake in two separate portal claims and it was always going to be the case that each party would win one and lose one. If you allow common law mistake in, then are you going to start allowing Estoppel, Offer and Acceptance, Waiver and Affirmation, Deemed Service?

    You need to think of the portal as being a bit like the small claims track. Its rough alright!

    sarahjrobson

    June 5, 2020 at 4:44 pm

    • I agree that it cuts both ways, two wrongs do not make a right.

      Yes, of course all common law principles should be allowed in the portal; after all common law simply represents the evolution of law so as to provide justice.

      For all intents and purposes, the portals are compulsory, in the sense that there are swinging costs penalties for failure to use them.

      In those circumstances, litigants should indeed be given the full protection of the common law.

      These are not small claims; by definition they are excluded from the process which covers claims up to £25,000, which is a significant sum of money to most people.

      Kerry

      kerryunderwood

      June 8, 2020 at 12:30 pm

  5. “Extend the Civil Procedure Rules to Cornwall” – tickled me there Kerry. Great post, thanks!

    Josh Coleman

    June 9, 2020 at 9:06 am


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