Kerry Underwood

Archive for August 2020

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

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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

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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.

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August 28, 2020 at 9:00 am

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CIVIL LITIGATION FUNDING AGREEMENTS: PART 1: CONTINGENCY FEE 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.

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

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LITIGANTS IN PERSON: WHY I THINK THEY SHOULD BE BANNED

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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

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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

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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

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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

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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

Posted in Uncategorized

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

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

Posted in Uncategorized

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.

Written by kerryunderwood

August 14, 2020 at 8:13 am

Posted in Uncategorized

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

COSTS CHAOS BETWEEN COURTS AND TRIBUNALS

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

In

JH (Palestinian Territories) v Upper Tribunal of the Immigration And Asylum Chamber & Anor [2020] EWCA Civ 919

the Court of Appeal, in a judgment so riddled with technical initials and abbreviations as to be almost incomprehensible, and to make Kafka seem like a light read, considered the validity of its own decision in

R (Faqiri) v Upper Tribunal (Immigration and Asylum Chamber) [2019] EWCA Civ 151

where it held that an order for costs could be made in favour of a successful claimant in CPR 54.7A proceedings against the Secretary of State for the Home Department, even though he was not a defendant but an interested party who had not actively participated in the proceedings.

The issues in the case here were, for all intents and purposes, identical.

CPR 54.7A deals with Judicial Review of decisions of the Upper Tribunal and the rule applies where an application is made, following refusal by the Upper Tribunal of permission to appeal against a decision of the First Tier Tribunal, for Judicial Review –

(a) of the decision of the Upper Tribunal refusing permission to appeal; or

(b) which relates to the decision of the First Tier Tribunal which was the subject of the application for permission to appeal.

Given the separate sets of rules dealing with costs in different jurisdiction there was a dispute about whether the Administrative Court, subject to the general Civil Procedure Rules, could remit the issue of the costs in the CPR 54.7A proceedings to the Upper Tribunal where costs are subject to Section 29 of the Tribunals Courts and Enforcement Act 2007, which gives the relevant tribunal full power to determine by whom and to what extent costs are to be paid.

The governing rules are the Tribunal Procedure (Upper Tribunal Rules 2008).

The Court of Appeal held that there must be an order for costs made by the Administrative Court at the conclusion of the CPR 54.7A proceedings but that order cannot be transferred to the Upper Tribunal, whose costs are governed by a different regime.

An appellate court cannot make a costs order effective in an appeal in a separate jurisdiction, governed by other enactments and different rules of court.

The costs of the CPR 54.7 proceedings cannot be regarded as “of and incidental to” the costs of the appeal.

The Upper Tribunal dealing with the appeal proceedings is not authorised by statute or rules of court to make an order in respect of the costs of the proceedings in the Administrative Court.

Here, the Court of Appeal said that this jurisdictional issue could be dealt with by transferring the Judicial Review proceedings to the Upper Tribunal in relation to the application for costs.

That had the effect of importing the CPR 44 General Costs Rules into the Upper Tribunal’s assessments of costs of the Judicial Review proceedings.

 

Comment

All costs in all proceedings should be contained in one document, with different rules for different tribunals as necessary, but all in one document and with as much unity as possible.

For example, the General Costs Rules in most tribunals could be covered by the statement that generally there will be no order for costs absent unreasonable behaviour.

The current scattering of costs rules across loads of different sets of rules, and in the case of the Civil Procedure Rules scattered throughout the rules themselves, is what leads to the huge volume of cases on costs.

I am not talking about assessment of costs; I am talking about the endless litigation about costs principles, and virtually all of which would be unnecessary if the rules were written clearly in the first place.

Written by kerryunderwood

August 6, 2020 at 9:39 am

Posted in Uncategorized

PROPORTIONATE COSTS ORDERS PREFERRED TO ISSUE BASED COSTS ORDERS: UPDATED: TWO NEW CASES

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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

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

the Queen’s Bench Division of the High Court awarded a successful claimant in a clinical negligence claim only 60% of his costs on the basis that the sum recovered was much lower than the sum sought as the court had overwhelmingly preferred the evidence of the defendant’s expert to that of the claimant’s expert.

 

In the words of the judge:

 

“…this had a profound impact on my findings on causation and consequently on quantum.”

 

The significance of the decision is the court’s finding that where the general rule that the winner gets costs is departed from, then the court should make orders expressed in percentage terms, or by reference to distinct periods of time, and should not make issue based costs orders.

Such orders are allowed pursuant to CPR 44.2(6)(f) but CPR 44.2(7) provides that before considering making an issue based cost order, the court should consider whether it will be practicable to make an order for payment of a proportion of costs, which is what the court did here.

 

The court said:

 

“Orders of this nature can present an unnecessary and disproportionate burden in Detailed Assessments where many of the issues (here negligence, causation and loss) materially overlap with each other and are difficult to unpick fairly.”

 

As to orders for distinct periods of time, these are common, as that is what happens in relation to Part 36, that is one party is ordered to pay the costs up to a certain date and is then the receiving party from that date onwards.

Indeed, that happened here as the claimant failed to beat the defendant’s Part 36 offer, and thus had to pay the defendant’s costs from the expiry of the time for accepting that offer.

It was the pre-Part 36 offer costs in favour of the claimant which were reduced to 60%.

Exactly the same approach was taken in another very recent case –

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.

I deal with the case in a separate blog – but the relevance here was that the court ordered the claimant to pay 80% of the costs, rather than making an issue based costs order, even though it said it could have worked the costs out issue by issue –

See my blog

PART 36: WITHDRAWN OFFER STILL COUNTS: AN UNFORTUNATE DECISION

 

Written by kerryunderwood

August 5, 2020 at 3:03 pm

Posted in Uncategorized

PART 36: WHAT HAPPENS WHEN ONE OF A NUMBER OF DEFENDANTS ACCEPTS A PART 36 OFFER?

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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.

 

The position is that the costs payable by that Defendant will be limited to the cost of the proceedings against that Defendant, which will generally be costs attributable solely to that Defendant’s case plus their share of any generic costs.

The authority is

Hynes v Department for Business Innovation and Skills [2014] EWHC 643 (QB).

In that case offers were made to ten Defendants, but only one of them accepted and the Claimant then discontinued against the others, and the court found that the Claimant was not entitled to recover all reasonable costs without those costs being disaggregated, proportioned or divided.

The single paying party would pay its own individual costs, together with its share of the common costs.

In that case the court interpreted the relevant provision at the time, CPR 36.13 (1) and said:

 

“The … issue turns on what is meant by the term, the Cost of the Proceedings” … I have no hesitation in concluding that the term means, in this context, “the costs of proceeding against the Defendant against whom the deemed order has been made.” Any broader definition would achieve obvious injustice and violate the language of the rule as seen in its proper contextual setting.”

 

Otherwise, a Claimant could sue parties who were in no way responsible for the tort, or breach of contract or whatever, and then recover from the guilty party, who accepts the Part 36 offer, all of the costs of wholly wrongly brought, and entirely misconceived, actions against the innocent party.

In respect of generic costs, the court considered that there were two categories of such costs:

(i) those which are non-specific and would have been incurred regardless of the number of the Defendants, such as court fees, medical reports and travel expenses; and

(ii) specific costs which are capable of identification and division, for example a conference with counsel in relation to the liability of each defendant.

The court held that the Claimant was entitled to recover the non-specific costs, such as court fees etc. in full, but then held in relation to specific generic costs, that these should be identified and divided appropriately.

The court held that the Claimant’s offer, which was accepted, was only ever intended to be an offer to settle the claim against that particular Defendant, leaving open the possibility of pursuing other Defendants for the balance of the alleged loss, where the offer was to settle the whole of the claim against any and all of the Defendants.

There is some suggestion in the case law that, even within Part 36, the parties are free to agree to a different form of order, for example, that a single accepting Defendant will pay all of the costs, including the costs incurred against the non-accepting Defendants.

My view is that that is wrong, as Part 36 is a self-contained code and seeking to impose costs conditions outside those imposed by Part 36, takes the offer outside of Part 36.

There is nothing to stop a Claimant in such circumstances making a Calderbank offer on the basis that any single accepting Defendant would be liable for the Claimant’s costs against all of the Defendants and that avoids the automatic application of Part 36, which the courts have constantly held to be a self-contained code.

Written by kerryunderwood

August 5, 2020 at 2:22 pm

Posted in Uncategorized

PERSONAL INJURY: QOCS AND FUNDAMENTAL DISHONESTY: NEW HIGH COURT CASE

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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

Pegg v Webb & Anor [2020] EWHC 2095 (QB)

the Queen’s Bench Division of the High Court, on appeal, overturned the trial judge’s finding that the claimant had not been fundamentally dishonest and substituted its own decision that the claimant had been fundamentally dishonest, and therefore lost Qualified One-way Costs Shifting protection and had to pay the costs of the defendant.

This was a road traffic accident for which the defendant driver was wholly liable, although the insurance company for the defendant had argued that there had been no accident, or if there had been, then it had been contrived by the parties.

The trial judge rejected that argument, but nevertheless dismissed the claim on the basis that the claimant had not shown that the accident had caused the injuries complained of, or indeed any injury at all.

Thus, it was a strange decision in that the judge accepted the claimant’s evidence that there had been an accident but rejected the claimant’s evidence as to injuries suffered and actually dismissed the claim, rather than just awarding modest damages and/or punishing the claimant in costs.

On appeal, the High Court said:

“…no judge could reasonably have failed to have come to the conclusion that the claim for damages as presented by the Claimant in this action was a fundamentally dishonest one, perpetrated by fundamentally dishonest accounts to the only medical expert and in the various court documents.”

In spite of dismissing the claim the trial judge had ordered the successful defendant to pay 60% of the claimant’s costs on the basis that the defendant’s allegation of fundamental dishonesty against the claimant meant that what would have been a one day fast-track claim became a two day multi-track claim.

There was no appeal against the finding that there had been no accident, or that if there had been an accident it had been staged between the parties.

Thus, the appeal turned on the dishonest evidence given by the claimant  to the medical expert.

The trial judge found that the claimant had failed to give the expert relevant information and that what he told the expert about the longevity of his injuries was inconsistent with his own evidence at trial.

Consequently, the trial judge said that no reliance could be placed on the medical report and, without that report the claim had to fail.

That a bit self is a somewhat curious finding as clearly a person could give evidence about their own injuries.

A month after the accident the claimant was involved in another accident, arising from his use of a quad bike and he attended the emergency department at hospital, but made no mention of the road traffic accident, and his alleged injuries, to the doctor at the hospital.

The expert spent just 10 minutes with the claimant.

He did not mention the second accident to the expert, and lied about various matters.

The trial judge said:

“I accept that, on the balance of probabilities, Mr Pegg knew that it was relevant to tell Mr Shakir about the quad bike accident but he did not do so.”

On appeal, the High Court found that that must have involved the trial judge finding that the failure by the claimant to tell the expert about the quad bike accident was dishonest.

Although each case will depend upon its facts, the court here reviewed the case law in relation to findings of fundamental dishonesty in the context of QOCS.

Here the High Court found that the dishonesty about the injuries was fundamental as that was the whole point of the claim and the evidence, as liability had been admitted.

It was “the very basis of the claim.”

The court adopted the common law test for dishonesty as recently restated by the Supreme Court in

Ivey v Genting Casinos Limited [2018] AC 391,

where the court said:

“When dishonesty is in question the fact-finding tribunal must first ascertain (subjectively) the actual state of the individual’s knowledge or belief as to the facts. The reasonableness or otherwise of his belief is a matter of evidence (often in practice determinative) going to whether he held the belief, but it is not an additional requirement that his belief must be reasonable; the question is whether it is genuinely held. When once his actual state of mind as to knowledge or belief as to facts is established, the question whether his conduct was honest or dishonest is to be determined by the fact-finder by applying the (objective) standards of ordinary decent people. There is no requirement that the defendant must appreciate that what he has done is, by those standards, dishonest.”

The High Court here also examined the scope of an appellate court in relation to findings of fact by the trial judge and reminded itself that there is a distinction between the finding of a specific fact and the finding of facts which were really an inference drawn from the facts specifically found.

In the case of so called inferred facts, an appellate tribunal will more readily form an independent opinion than in the case of specific facts which involve the evaluation of the evidence of witnesses.

The High Court allowed the appeal and ordered that the order dismissing the claimant’s claim be endorsed with a finding of fundamental dishonesty on the part of the claimant in relation to the claim for damages.

In relation to costs, the judge substituted an order that the claimant pay 70% of the defendant’s costs, to be assessed on the indemnity basis, and due to the finding of fundamental dishonesty the defendant can enforce the full order in accordance with CPR 44.16(1) which provides:

“(1) Orders for costs made against a claimant may be enforced to the full extent for such orders with the permission of the court where the claim is found, on the balance of probabilities, to be fundamentally dishonest.”

The reason that the court only ordered 70% of the defendant’s costs to be paid was that it had failed in its allegation against the claimant that the claim was bogus either because there had been no collision or there had been collusion between the parties.

Written by kerryunderwood

August 4, 2020 at 2:00 pm

Posted in Uncategorized

PORTALS: PUTTING CASE ON WRONGLY: WRONGLY USING PART 8 AND NOT PART 7: NO STRIKE OUT

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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

Cable v Liverpool Victoria Insurance Co Ltd [2020] EWCA Civ 1015

the Court of Appeal held that an action should not be struck out because the claimant had wrongly used the portal and Part 8 procedure, instead of Part 7.

In so doing, it overturned the decision of the District Judge, which in turn had been upheld on appeal by the Circuit Judge.

The claimant placed the matter, which arose out of a road traffic accident in September 2014, on the Road Traffic Accident portal, but a subsequent medical report indicated that the claimant was absent from work and the claim would be much higher than the portal limit.

The defendant sought further information but got little response, with the claimant engaging in what the District Judge termed “radio silence”.

In July 2017 the claimant issued a Part 8 claim form and a stay was granted until August 2018 and the court ordered that a copy be sent to the defendant by August 2017, but this was not done until February 2018.

Part 8 is the procedure for dealing with the matter under Stage 3 of the portal system.

In August 2018 the claimant’s solicitors informed the defendant that the case was substantial and applied to lift the stay and for the matter to proceed under Part 7, and that application was granted without notice.

The defendant applied to set aside the without notice order; the District Judge did so and refused permission for the matter to proceed by way of Part 7 and the claimant’s appeal to the Circuit Judge was dismissed and the effect was that the claim was stuck out.

 

The Court of Appeal put the issue in this way: 

 

“2. But what happens if, following the making of a claim under the RTA Protocol, Part 8 proceedings are started and then immediately stayed on the false premise that the claim is or remains a low value RTA claim, when it is (or should have been) obvious to the claimant’s solicitors that the claim was worth almost a hundred times more than £25,000? That is the question raised in this appeal. In the light of the many failures on the part of the appellant’s solicitors, the district judge declined to lift the stay and transfer the claim to CPR Part 7. In consequence, she struck out the claim altogether. The circuit judge upheld her order. The issue for this court is whether she was right to have done so.”

 

The Part 7 claim form claimed £2.2 million.

The Court of Appeal stated that the real issue is whether the claimant’s conduct warranted the draconian penalty of his claim being struck out, as that was the effect of refusing to lift the stay.

The key issue therefore was whether the claimant’s conduct was an abuse of process.

Firstly, the court has to determine whether the claimant’s conduct was an abuse of process, and if it was, then the court has to exercise its discretion as to whether or not to strike out the claim, with particular reference to the proportionality of that penalty.

The lower courts had erred in not recognising that the true nature of the decision was a strike out and consequently had failed to address the issues to be determined on strike out.

 

“66. The consequences of this flawed approach can be seen most obviously at [67] and [68] of her judgment. At [67] she said that, in all the circumstances, it would not be a proper exercise of her discretion to allow the appellant’s solicitors to transfer this case to Part 7, “so I’m not going to exercise that discretion”. As she recognised at [68], “that leaves that claim form in limbo. The stay has expired. I have not granted permission to lift that stay and therefore the court has no other option but to strike a claim out”.

67. For the reasons that I have given, I do not think that that was the right approach. The striking out of a claim should never become the sort of administrative afterthought which DJ Campbell describes in these passages. For that reason, therefore, I have concluded that it is necessary for this court to consider afresh the two stages of the test identified in Asturion. Was there an abuse of process and, if so, what is the appropriate sanction for that abuse? In particular, was it proportionate to strike out the claim?”

 

The Court of Appeal then proceeded to consider the matter afresh.

It found that there was an abuse of process by the claimant.

However, in the exercise of its discretion, taking into account that the defendant had admitted liability and the claim had been issued in time, the Court of Appeal held that there was no prejudice to the defendant, except delay, whereas there was obvious, severe prejudice to the claimant in having his admitted claim struck out.

He would then need to sue his solicitors for negligence, and that would be a loss of a chance claim, and not necessarily for the full value.

As a sanction the Court of Appeal ordered that the claimant pay the defendant’s costs on the indemnity basis up to and including the hearing before the District Judge, and recover no interest on special damages before the same date, 17 October 2018.

The stay was lifted, and the matter transferred to Part 7.

My write-up of the Circuit Judge’s decision appears here in my blog

£2.6 MILLION CLAIM SHOULD NOT GO ON THE PORTAL: CLAIM STRUCK OUT

Written by kerryunderwood

August 4, 2020 at 12:34 pm

Posted in Uncategorized

DETAILED ASSESSMENT: COSTS DISALLOWED IN FULL DUE TO MISCONDUCT

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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

Farmer v The Chief Constable of Lancashire [2019] EWHC B18 (Costs)

the Senior Courts Costs Office disallowed all of the costs of the receiving party, due to its misconduct during detailed assessment proceedings.

The receiving party’s original bill of costs for detailed assessment was £174,565.79 and included £58,573.29 for a success fee under a Conditional Fee Agreement (CFA1), which the receiving party now admitted was unenforceable, and costs calculated at wrong hourly rates, which the receiving party conceded were too high.

The paying party applied pursuant to CPR 44.11 to disallow all of the bill.

The receiving party submitted a replacement bill of costs, but the arithmetic was wrong and the summary, although not the total, still contained CFA1.

The Master held that a second CFA was retrospective only to around 14 March 2015, not the start of the action in 2012.

There was, therefore, no retainer under which parts 2 and 3 of the bill could be recovered.

The bill also included the costs of an application to dislodge the receiving party’s litigation friend, which should not have been included.

The correct total costs were about £68,000, around one third of the original total and well below the threshold for detailed assessment.

Had the bill been correct, the court fee would have been lower and the costs of the detailed assessment proceedings would have been capped at £1,500 plus VAT.

Instead, four days of court time had been set aside to hear the bill of costs which was still incorrect.

The receiving party’s solicitor had signed the bill, the replies to the paying party’s Points of Dispute and a Witness Statement without any proper regard for the need to check the facts and ensure that matters were dealt with properly.

The conduct of the receiving party’s solicitor was unreasonable, improper and in breach of the CPR, especially the overriding objective (CPR 1.3).

This justified disallowing, under CPR 44.11, all of the remainder of the bill of costs.

The court distinguished

Gempride Ltd v Bamrah and another [2018] EWCA Civ 1367

where the claimant lost half of the profit costs for claiming a higher hourly rate than the solicitor – client retainer provided for.

The claimant’s solicitors in the Farmer case, McMillan Williams Solicitors Ltd, heavily criticized here, went into administration in May 2020.

 

Comment

Time and time again solicitors conduct the actual case with great skill and tenacity, but then adopt a very scrappy and careless approach to costs, often delegating the task to a junior member of staff who is not properly informed about the file, and the law of costs.

Written by kerryunderwood

August 4, 2020 at 7:52 am

Posted in Uncategorized

EMPLOYMENT: TRANSFER OF UNDERTAKINGS: TWO NEW CASES

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

Transfer to Multiple Transferees

In

ISS Facility Services NV v Govaerts and another Case C – 344/18 (ECLI:EU:C2020:239)

the European Court of Justice held that where there is a transfer of an undertaking involving a number of transferees, Article 3(1) of the Acquired Rights Directive means that the rights and obligations arising from a Contract of Employment are transferred to each of the transferees, in proportion to the tasks performed by the worker concerned.

This is subject to the condition that the division of the Contract of Employment as a result of the transfer is possible and does not cause a worsening of working conditions, nor adversely affect the safeguarding of the rights of workers guaranteed by the directive.

If such a division of the contract is impossible, or would adversely affect the worker’s right, then the transferees would be regarded as being responsible for any consequent termination of the employment relationship, under Article 4, even if that termination was initiated by the worker.

This is the first ruling on this point, and it is surprising that it has not arisen before.

United Kingdom law has previously held that an employee cannot be transferred to more than one employer, but that is no longer good law.

Here, Sonia Govaerts was employed by ISS as the project manager responsible for cleaning and maintenance of three lots of buildings in the city of Ghent.

When the three cleaning contracts were put out to tender, ISS were unsuccessful and two of the contracts were awarded to one company and one to another company.

The options were:

(i) that Ms Govaerts’ contractual rights and obligation were transferred to the transferees in proportion to the tasks she performed;

(ii) the transfer was solely to the transferee with whom she was to perform her principle tasks; or

(iii) the rights could not be asserted against either of the transferees.

That third option would previously have been the outcome under UK law.

In fact, the European Court of Justice went for the first option.

It is a matter for the referring domestic court to determine whether the Contract of Employment should be distributed in accordance with the economic value of the lots to which the work was assigned , or in accordance with the time that the worker spends on each lot.

 

Beneficial as Well as Detrimental Variation of Contract Void on Transfer

In

Ferguson and Others v Astrea Asset Management Ltd: UKEAT/0139/19/JOJ

the issue was whether Regulation 4(4) of the Transfer of Undertakings Regulations, which voids “any purported variation of a Contract of Employment” if the sole or principal reason for the variation is the transfer, applies to a variation which benefits the employee.

The Employment Appeal Tribunal found that it did and that a variation of a contract which improves the employee’s terms and conditions is void if the sole or principal reason for the variation is the transfer of an undertaking.

Obviously it does not prevent the parties subsequently agreeing an improvement, such  as an increase in pay, and just as in an employment relationship where there has been no transfer, an employee will invariably agree a beneficial change to the employment contract.

The facts here were unusual in that the controllers and employees of a business about to be transferred arranged for their contracts to be substantially improved so as to provide for guaranteed bonus payments and increased termination payments, but only if the transfer went ahead.

Such changes are known as “poison pills” and can be used by firms holding the contract so as to discourage bidders for the contract.

Here the transferee dismissed the employees for gross misconduct and the Employment Judge found that the new terms were not agreed for any legitimate commercial purpose and that the claimants were acting dishonestly.

Furthermore, the terms of the new contracts were void as it involved a variation by reason of the transfer.

The Employment Appeal Tribunal upheld that ruling and said that:

“…since the purpose of the Directive is to safeguard (and not to improve) the rights of employees which may otherwise be damaged by reason of a transfer, it seems reasonable to exclude positive as well as negative consequences of the transfer.”

Written by kerryunderwood

August 3, 2020 at 11:05 am

Posted in Uncategorized

LITIGATION FRIENDS: DUTIES AND PROCEDURE

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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.

As will be seen below the issue of Litigation Friends is dealt with in CPR 21 and covers children and protected parties.

By definition, children are far less likely to be involved in litigation outside the field of personal injury as they cannot enter into contracts, except for necessities, during their minority, and thus the vast majority of cases in which a Litigation Friend is appointed for a child is in the field of personal injury.

Protected parties are very different; while some clients have lost capacity due to injury, resulting in a personal injury case, very many other examples of Litigation Friends for protected parties are in the general field of civil litigation, rather than personal injury.

In the last two years, there have been three significant cases involving the court’s powers in relation to Litigation Friends outside the field of personal injury.

In

Hinduja v Hinduja & Ors [2020] EWHC 1533 (Ch)

the Chancery Division of the High Court considered in detail the role of Litigation Friends, including their duties and the issue of when a conflict may arise between a Litigation Friend and a protected party.

The case also looks at the requirement to file a certificate of suitability under CPR 21.5 and the necessary steps under CPR 21.3(4) to cure such a failure so as to give effect to all steps taken in the proceedings prior to the filing of the certificates.

The judgment analyses CPR 21 in detail; all lawyers who frequently act for children or protected parties need to be very familiar with this rule, which is not always the case in my experience.

The court has the power to allow a child to litigate without a Litigation Friend; there is no such power in relation to a protected party (CPR 21.2(1)).

Any step taken before a protected party has a Litigation Friend has no effect unless the court orders otherwise (CPR 21.3(4)).

CPR 21.4 reads:

(1) This rule does not apply if the court has appointed a person to be a litigation friend.

(2) A deputy appointed by the Court of Protection under the 2005 Act with power to conduct proceedings on the protected party’s behalf is entitled to be the litigation friend of the protected party in any proceedings to which his power extends.

(3)  If nobody has been appointed by the court or, in the case of a protected party, has been appointed as a deputy as set out in paragraph (2), a person may act as a litigation friend if he –

(a) can fairly and competently conduct proceedings on behalf of the child or protected party;

(b) has no interest adverse to that of the child or protected party; and

(c) where the child or protected party is a claimant, undertakes to pay any costs which the child or protected party may be ordered to pay in relation to the proceedings, subject to any right he may have to be repaid from the assets of the child or protected party.

 

CPR 21. 5 and CPR 21.6 are dealt with at paragraphs 17 to 19 of the judgment here:

 

“17. CPR 21.5 sets out the procedure for a person to become a litigation friend without a court order. Paragraph (1) provides that if the court has not appointed a litigation friend “a person who wishes to act as a litigation friend must follow the procedure set out in this rule”. Where no deputy has been appointed by the Court of Protection with authority to conduct proceedings, the procedure is governed by paragraph (3), which provides that (where the protected person is the claimant) the person “must” file a certificate of suitability “at the time when the claim is made”. Paragraph (4) deals with service, notably not requiring service on the other parties, but rather on someone acting for the protected party, such as a donee under a lasting power of attorney (see CPR 6.13).

18. CPR 21.6 provides that the court may make an order appointing a litigation friend. An application may be made either by the person who wishes to be the litigation friend or by a party, and must be supported by evidence. The court may not appoint a litigation friend under CPR 21.6 unless it is satisfied that the person to be appointed satisfies the conditions in CPR 21.4(3). CPR 21.8 requires any application under CPR 21.6 to be served in accordance with CPR 6.13.

19. Further detail about applications under CPR 21.6 is provided by paragraph 3 of Practice Direction 21, which requires any application to be made in accordance with Part 23, and that the evidence in support must satisfy the court that the litigation friend not only consents to act but meets the requirements set out in CPR 21.4(3). It is again worth noting the position regarding service. Service on other parties to the litigation (in this case, the Defendants) is not automatically required. As pointed out by Wilson LJ in Folks v Faizey [2006] CP Rep 30 at [30], the “respondent” on whom an application under Part 23 must be served is the person “against whom the order is sought”. Others are served only if the court so directs. 

In relation to defendants, a Litigation Friend need only be appointed once a step is taken in the proceedings on the defendant’s behalf.

The court also considered the issue of mental capacity in relation to legal proceedings, and in particular the leading Court of Appeal decision in

Masterman-Lister v Brutton [2003] 1 WLR 1511

where the court said that the key question is whether the party is capable of understanding, with the proper explanation from legal advisers and other experts as the case may require, the issues on which his or her consent or decisions are likely to be necessary: does s/he have the “capacity to understand that which he needs to understand in order to pursue or defend a claim”?

Generally, the issue of capacity is to be decided by the person him or herself, his or her carers, perhaps with the advice of a solicitor, without the need for enquiry by the court.

There is no need for medical evidence.

Age itself cannot justify the need for a Litigation Friend.

The fact that the proposed Litigation Friend is an attorney under a Power of Attorney is a strong indication that the party trusted that person to act in his or her own best interests, and is relevant to the appointment.

 

The issue of a Litigation Friend’s objectivity is dealt with at paragraphs 60 to 62 of the judgment.

 

“60. The comments made about objectivity were obviously made in the context of the facts of that case. The key tests to apply are those set out in the rules. In conducting litigation fairly and competently on behalf of a protected party, it is obvious that a litigation friend must acquaint him or herself with the nature of the case and, under proper legal advice, make decisions in the protected party’s best interests. Being “objective” in this context cannot mean independent or impartial vis-à-vis both parties to normal adversarial civil litigation. The litigation friend is acting on behalf of the protected party. Any objectivity required must relate to the litigation friend’s ability to act in the protected party’s best interests, and in doing so listen to and assess legal advice, and properly weigh up relevant factors in making decisions on the protected party’s behalf.

61. The requirement not to have an adverse interest is closely linked to the requirement that the litigation friend can fairly and competently conduct the proceedings. Any adverse interest would obviously risk compromising the litigation friend’s ability to act fairly in the protected party’s best interests, or at least risk giving the appearance of doing so. For example, in Nottinghamshire County Council v Bottomley [2010] EWCA Civ 756a litigation friend who was subject to a conflict of interest as between the local authority who employed her and the child she was representing was removed. Stanley Burnton LJ made the point at [19] that a litigation friend must be able to exercise some independent judgment on the advice received, and it would be unfair to expect the litigation friend to choose a form of settlement most unfavourable to her employer. He also said that the principle that justice must be seen to be done requires the litigation friend not to be seen as having a conflict.

62. Whether the existence of a financial interest on the part of the litigation friend should debar them from acting will depend on the nature of the interest, and whether it is in fact adverse or whether it otherwise prevents the litigation friend conducting the proceedings fairly and competently on the protected party’s behalf. A person is not prevented from being a litigation friend simply because they have a personal interest in the proceedings. It would, for example, be relevant if any personal interest that the litigation friend had meant that he or she could not approach the litigation in a balanced way, in the sense of not being able to weigh up legal advice and decide what should be done in the protected party’s best interests. But it would be highly unlikely that a litigation friend would be unable to do so simply because he or she has an interest in the proceedings, in circumstances where that interest is aligned with that of the protected party.

On the facts here the court cured the defect of the late filing of the certificate of suitability, holding that the claimant lacked capacity and that the proposed Litigation Friend was suitable.

 

Comment

This is a very helpful decision which analyses the Civil Procedure Rules and case law in this area in detail.

It is clear from the enquiries that I get many solicitors treat the appointment of a Litigation Friend as pretty much a formality, without considering in detail the suitability or otherwise of the Litigation Friend, and without advising the Litigation Friend, again in detail, as to their responsibilities, obligations and considerable liabilities.

 

Court’s Power To End Appointment of Litigation Friend

In

Raqeeb, R (On the Application Of) v Begum & Anor [2019] EWHC 2976 (Admin)

the Administrative Court dismissed an application by Barts Health NHS Trust to terminate the appointment of a litigation friend acting for a child in judicial review proceedings concerning the provision of life-sustaining treatment for the child.

The court reviewed the duties of a litigation friend under CPR 21, and the court’s discretion under CPR 21.7 to terminate a litigation friend’s appointment.

The child, acting through her court-appointed litigation friend, a family member, brought a judicial review challenge against a refusal by the defendant hospital trust to permit the child to be transferred to a hospital in Italy for continued life-sustaining treatment.

During those proceedings, the defendant hospital trust applied for a determination that withdrawing such treatment was in the child’s best interests.

The defendant hospital trust also applied to terminate the court-appointed litigation friend’s appointment as the child’s litigation friend, arguing that the court-appointed litigation friend, owing to her familial love for the child as well as her religious beliefs, lacked the ability to take a balanced and even-handed approach regarding the child’s best interests.

The judge reviewed the authorities and set out the relevant principles.

The court has a wide discretion to terminate a litigation friend’s appointment.

A litigation friend, including one appointed by the court, must be able fairly and competently to conduct proceedings.

This includes acting under proper legal advice, but also being able to exercise some independent judgment on that advice.

A litigation friend who does not act on proper advice may be removed.

The litigation friend must have no interest adverse to that of the child, but there is no principle that a family member cannot act as a litigation friend, so long as they can take a balanced and even-handed approach to the relevant issues.

Religious beliefs of themselves do not disqualify a person from acting as a litigation friend.

Applying these principles, the judge dismissed the defendant hospital trust’s application.

The judge found that the defendant hospital trust’s arguments concerning the litigation friend’s religious views were only relevant to the consequences of a potentially successful outcome to the judicial review application, rather than the merits of the underlying application itself.

The litigation friend had taken legal advice on those merits from the child’s experienced, specialist legal team, and there was no suggestion by that team that the litigation friend acted inappropriately in the context of that advice or had an improper motive.

A litigation friend is an officer of the court whose duty is to take all measures for the benefit of the infant in the litigation – Rhodes v Swithenbank (1889) 22 QB 577.

A litigation friend must take legal advice, but must also be able to exercise some independent judgment on that advice – Nottinghamshire CC v Bottomley [2010] EWCA Civ 756.

 

Appointment of Litigation Friend by Court

In

Keays v Executors of the Late Parkinson [2018] EWHC 1006 (Ch) (8 May 2018)

a Chancery Division Master had a rare opportunity to deal with an application to replace a litigation friend under CPR 21.7.

The case involved Flora Keays, the daughter of the late Cecil Parkinson, the politician and Flora was represented by her mother, Sara Keays, in a claim against the estate under the Inheritance (Provision for Family and Dependants) Act 1975 and it was common ground that Flora lacked capacity to conduct the proceedings herself.

The Defendant executors sought to remove Sara Keays as Flora’s litigation friend, on the grounds that she could not fairly and competently conduct proceedings on Flora’s behalf and that she had an interest adverse to Flora’s interest.

Sara Keays did not object in principle to her being removed as litigation friend after the executors had agreed to fund the costs of a suitable litigation friend acting for Flora and also Flora’s litigation costs.

However, there was a dispute over who the replacement should be and that was the subject matter of this application.

Sara Keays proposed three solicitors but the executors objected to her preferred choice and the court considered whether the executors had shown grounds for removing Sara Keays as the litigation friend.

The court rejected the executors’ submission that Sara Keays was not a suitable litigation friend within the meaning of CPR 21.4 and stated that the evidence was that if she could instruct a competent solicitor with relevant expertise, then she would be able fairly and competently to conduct the proceedings.

The Master stated that a litigation friend had extensive dealings with the parent or the person responsible for the child or protected party and therefore the court should be reluctant to impose a litigation friend on that person and, should only do so if there is no other viable candidate.

The Master considered that Sara Keays should be entitled to appoint her preferred solicitor and the executors’ criticisms of that solicitor were not made out.

The Master therefore made an order appointing Sara Keays’ preferred choice of a solicitor as Flora’s litigation friend.

The Civil Procedure Rules provide for self-certification by the litigation friend that she satisfies the conditions specified in CPR 21.4(3) – see CPR 21.5 – and Sara Keays filed and served such a certificate.

 

CPR 21.7 deals with the replacement of a litigation friend and provides:

 

“(1)    The court may –

(a)    direct that a person may not act as a litigation friend;

(b)    terminate a litigation friend’s appointment; or

(c)   appoint a new litigation friend in substitution for an existing one.

(2)   An application for an order under paragraph (1) must be supported by evidence.

(3)  The court may not appoint a litigation friend under this rule unless it is satisfied that the person to be appointed satisfies the conditions in rule 21.4(3).”

 

Here the Master considered the case of

 

Davila v Davila (18 April 2016) and adopted the remarks made by the judge in that case

 

137:

“(1) As noted above, CPR 21.4(3)(b) stipulates that in order for a person to act as a litigation friend that person must have “no interest adverse to that of the …protected party”. The relevant inquiry here is directed towards the conduct and outcome of the litigation for which the individual is to be appointed as litigation friend, and it will in most cases not be relevant to search, outside the bounds of the particular litigation, for some factor that might suggest some potential conflict between the interests of the party and the interests of the litigation friend unless it can reasonably be said that this potential conflict may also affect the manner in which the litigation friend is likely to approach the conduct of the litigation itself.

(2) Moreover, what this prohibition is directed towards is an interest that is “adverse” to that of the protected party. It follows that the fact that the person appointed as litigation friend has his own independent interest or reasons for wishing the litigation to be pursued ought not, in general, to be a sufficient reason for impeaching that appointment. Such an interest would, at least in general, run in the same direction as the protected party rather than being adverse to the protected party’s interests.

(3) However, it is necessary in this context to have regard to the decision of the Court of Appeal in Nottingham CC v Bottomley and another [2010] EWCA Civ 756, the only authority on this issue to which I was referred. In dealing with the position of a litigation friend, Stanley Burnton LJ (with whom Rix and Maurice Kay LLJ agreed) emphasised the need for the litigation friend to “seek the best outcome” for the protected party and for a litigation friend to “be able to exercise some independent judgment on the advice she receives from those acting for a claimant, and …be expected to accept all the advice she is given”, something that might be difficult where, as in that case, the litigation friend worked for an organisation that would benefit from a settlement in a form that might not necessarily be to the benefit of the protected party itself.

(4) This highlights the fact that, even where the interests of the protected party and litigation friend generally run in parallel or coincide, this does not of itself preclude the possibility that, in some contexts, those interests might diverge and become adverse. Whether or not that is so will, of course, always depend upon the facts of the particular case.”

 

The court rejected the executors’ submissions and allowed the appointment of the solicitor preferred by Sara Keays.

Bizarrely the executors themselves sought the appointment of a solicitor proposed by them which, in a masterful understatement, the Master referred to as “an unusual application”.

The barrister for the executors submitted that it was perverse for Sara Keays to insist upon a solicitor to whom the executors object, and the Master rejected that submission and said that provided the solicitor is otherwise suitable, Sara Keays should be entitled to choose the solicitor that she wanted.

The executors’ objection to the preferred solicitor was that she had taken an obstructive and unreasonable approach to settlement discussions in the claim and was likely to do so again, and that her costs were too high.

In other words the primary objection was that the solicitor would do her job in representing Flora Keays, a protected party.

 

The Master was unimpressed:

 

“The suggestion that the overriding objective requires harmonious personal interactions between solicitors acting for opposing parties seems to me to be unrealistic.” (Paragraph 55)

 

Finally the judge had this to say:

 

“57. Finally, I mention that although the executors in their capacity as such have no interest in the outcome of the claim, they have not taken a neutral position reflecting that absence of interest. Instead, they have actively defended the claim. This has included making the current application. The executors’ counsel informed the court that the stance taken by the executors was supported by the beneficiaries. This is not desirable because costs attributable to the executors’ role in the claim in their capacity as such ought to be clearly distinguishable from costs incurred in opposing the claim: see CPR PD 46, para 1.”

Written by kerryunderwood

August 3, 2020 at 8:31 am

Posted in Uncategorized

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