Case Alerts

This article was first published online by Highways Today on 15th November 2018 and is reproduced with kind permission.

Introduction

The Well-managed Highway Infrastructure Code (“WMHI”) was published in October 2016. Its two year transition period has now ended. The code was touted as a review of existing practice, as opposed to a complete rewriting, with the focus shifting to a risk-based approach to reflect the flexibility required to enable authorities to adequately respond to each specific sector.

Its 36 recommendations, broadly split across 6 different focussed areas, are officially in force and the WMHI will now be relied upon by local authorities, practitioners, experts, lawyers and the courts as guidance when the adequacies of the network in question are challenged.

This article focuses on a few key areas of the WMHI and highlights important considerations when dealing with civil claims for damages.

Risk Analysis

There has been extensive consultation, engagement and debate as to the changes contained within the WMHI – the most significant being the asset management approach to highway infrastructure based on the establishment of local levels of service through risk-based assessment – Recommendation 7.

Each authority is now left to determine and implement its own network agenda based on its assessment and evaluation of specific needs. A useful reference point is ISO 31000:2009 Risk Management Principles and Guidance. This sets out the management process and model to maximise the effectiveness of a risk-based approach, which can then be adapted to each highway network.

The risk-based approach permeates all of the guidance and includes operational and asset plans, the classification and hierarchy of the network itself, the frequency and method of inspections, investigatory levels and repair timescales.

It is imperative that any decision made in relation to a network risk is documented and recorded so that evidence can be obtained to justify that decision if and when challenged. This could include, amongst others, defined policy and procedures, documented and approved minutes from executive committees, classification data, records of previous accidents and previous claims. Unfortunately, the extent of what a court may wish to consider in order to rule on an authorities’ classification of risk is currently unknown, but it is clear that such information will be a critical consideration in any defence to a claim.

Part of the management of a risk-based approach is also the need to review and monitor the risks of the network. This may be through periodic reviews of usage classifications, new data models and/or condition surveys and a review of defensibility of claims both in the local authority and elsewhere. Evidence will be required to prove that risks are continually being assessed and reviewed. For potential developers within an authority, consideration will need to be given, and evidence provided, as to whether the use of the network will alter and how this can be justified should such a development progress.

Data

Accurate, up to date and accessible data is key. The WMHI specifically states that “A risk-based approach to highway maintenance needs to be founded on information that is sufficiently robust to enable decisions on levels of service to be taken and reviewed over time.” It is clear that the collection, accuracy and analysis of data will be paramount when explaining the risk-based decisions adopted by each local authority under the WMHI.

The recommendations identify the importance of data management as it requires a review and analysis of a number of factors including but not limited to: current/expected levels of use; resilience; local economic and social factors; together with a review of the scale, nature and use of individual assets such as schools and hospitals. This background network data will be relied upon in any defence of a claim as the justification for the risk level in each case.

Careful consideration must be taken as to how such data is collected and reviewed and authorities should consider the adoption of new and emerging technologies as part of their highway service as evidence will be required when the authority is required to justify its categorisation within the network hierarchy.

Collaboration and communication

One of the underlying themes throughout the WMHI is one of integration, collaboration and communication. Within recommendations 3, 4, 5, 6, 8, 24 and 30 it has an important impact on all stages of risk assessment. Whether this be the need for each individual authority to work closely with its internal highway divisions, to publish policy and strategies, to facilitate transparency through data or for each neighbouring authority to be aware and involved in the approach adopted elsewhere, there is a clear push for a unified approach to be adopted and explained. In promoting consistency for all network users irrespective of geographical location, the WMHI encourages local authorities to work closely together when determining levels of service and to justify the approach they have adopted.

The effectiveness of the new recommendations should be encouraged through the establishment of relevant forums, peer-to-peer training and sharing of experiences. However, each authority may well have to differ its approach depending on the characteristic of the assets it has within its control. The relative strength and defensibility of each policy decision will then depend on its ability to record, share and explain its reasoning before court.

There is some concern that the inherent flexibility envisaged by the risk-based approach leaves an authority potentially exposed to large amounts of data and information requests disproportionate to the value of the claim itself. This may lead to satellite litigation to determine the appropriate disclosure of relevant information and is something one would expect to be considered by the courts in the near future.

Competencies and Training

Another area open to challenge within a civil claim is the proven competency of persons involved in the implementation of the guidance in the network itself. Recommendation 15 specifically states that appropriate competencies for all staff should be identified. Training should be provided for directly employed staff (where needed) and contractors should be required to provide evidence of the appropriate competencies of their staff.

Because of the reliance placed on the need to explain each risk-based decision, it is inherent within the system that those persons who will assess the risks are suitably qualified to do so.

Individual training and development plans should be established and reviewed and formal training records should be kept. The use of external training providers and vocational qualifications may be relied upon as evidence of the competency of those whose decisions are being challenged. The need for regular review and refresher training will also be paramount to demonstrate the suitability of qualifications and experience.

Consideration should also be given to membership of professional bodies and/or the need to evidence compliance with industry standards and qualifications provided by an accredited programme. There are a number of diplomas and courses currently available but it is expected that more courses specifically designed to address the risk-based approach will be made available to practitioners as challenges to the competency of persons involved in the network develops in the courts.

Conclusion

The intention behind the WMHI is to promote flexibility and transparency. Whilst each local authority is able to devise its own risk based approach, it must be able to justify and evidence those decisions. The intention is that this is not undertaken in isolation but that there is the opportunity and desire for shared learning across the country to help achieve a more unified network.

As the recommendations only came into force on 28^th October 2018 the courts are yet to interpret how the recommendations should be implemented. There will certainly be challenges ahead as the new approach is explored in court but there are clear opportunities for both local authorities and businesses involved in the highway infrastructure to fully maximise the increased flexibility encouraged through the risk-based approach as long as careful consideration has been given as to how they are able to explain, evidence and justify the relevant decisions made.

If you would like to know more about this matter, please speak to your contact at Plexus Law:

Tom Silson, Associate Partner

T: 0161 2457 973   |   M: 07790 344 010  |   E: tom.silson@plexuslaw.co.uk

City Tower  |  Piccadilly Plaza   |  Manchester |  MI 4BT

Whilst we take care to ensure that the material in this Case Alert is correct, it is made available for information only, and no representation is given as to its quality, accuracy, fitness for purpose, or usefulness. In particular, the contents of this Case Alert do not give specific legal advice, should not be relied on as doing so, are not a substitute for specific advice relevant to particular circumstances. Plexus Law accepts no responsibility for any loss which may arise from reliance on information or materials published in this Case Alert.

Does a clinically unqualified A&E receptionist owe a duty of care in giving information about waiting time? On 10 October, in Darnley v Croydon Health Services NHS Trust [2018] UKSC 50, the Supreme Court said yes.

Facts

Just before 8.30 pm Mr Darnley arrived at a hectic A & E department, having received a violent blow to the head. He complained of considerable pain, but when the reception desk simply told him he would have a 4-5 hour wait he went home without telling anyone at the hospital, later deteriorating and suffering permanent brain damage.

But he would ordinarily have been triaged by a qualified nurse within 30 minutes. He would have stayed if he had been told that, and the resulting priority treatment would have meant a very near full recovery.

Previously

The trial judge recorded the above but ruled that for an unqualified A & E receptionist it was a courtesy, but not a duty, to give information about waiting time, and it was not “fair, just and reasonable” to impose one. Potential liability could mean all such staff being told never to give any indication on timing.

Their role was clerical and confined to obtaining accurate details and relaying those to qualified colleagues. Waiting time was a matter of clinical judgment for the medical team. There was no breach in the reception desk either failing to provide accurate information or providing inaccurate information, and in any case the cause of the Claimant’s brain injury was his own uncommunicated departure.

By a 2:1 majority the Court of Appeal agreed.

To place a duty on A&E receptionists not to provide inaccurate information about waiting time would add a new layer of responsibility for clerical staff. It would create wider potential liability and might lead to increased contest over what was said across the desk.

The reception here had not assumed responsibility for the consequences of the Claimant’s decision to leave, which alone was the cause of his major injury.

Decision

A unanimous Supreme Court reversed this, ruling that:

1. Rather than opening new avenues of liability or expanding the duty of care, the case came within an established category for an A&E department. That was to take reasonable care not to cause physical injury to a patient, and included a matching duty not to provide misleading information which could foreseeably do that;
2. The duty not to provide such misinformation did not depend on whether medical or non-medical staff were involved, though that might sometimes be relevant as to whether there had been a breach of duty;
3. Here the standard was that of an averagely competent and well-informed A&E receptionist, and it was negligent to have misguided the Claimant as to when he would first get medical help;
4. That had caused the Claimant’s permanent brain injury.  His leaving was at least partly based on a misleading implication that he would have to wait 4-5 hours before being seen by a doctor, when he would have stayed (and thus been successfully treated) if he had known the true position of qualified triage usually within 30 minutes.

Commentary

At first blush this decision signposts the information given by an A&E reception desk – and perhaps others – an additional claims target. However, it is submitted that it does not and that the ruling should not encourage focus on what might have been said at reception, by switchboard or via any other first point of contact.

All will depend on what happened. The dissenting Court of Appeal opinion was expressly “fact specific”, and while the Supreme Court was less emphatic on that there is nothing to suggest a boundless duty to provide, update and otherwise correct information on waiting time. Such will vary according to demand and emerging priority, and a reception desk cannot be expected to keep patients continually posted.

The “question … is whether [there is] a duty to take reasonable care when providing … information as to the period of time within which medical attention is likely to be available”. Precision on that had not been suggested and would be impossible.

This case emphasises a duty not to mislead, but it would be unwise and probably unworkable to seek refuge in silence. As the Supreme Court hinted, this risk area might best be addressed by a suitable notice or leaflet – taking account of experience and relevant guidelines – on the nature of possibly unfamiliar triage and its normal waiting time.

If you would like to know more about this matter, please speak to your contact at Plexus Law:

Dr. Julian Morris, Partner

T: 020 7220 5873   |   M: 07584 101 584  |   E: julian.morris@plexuslaw.co.uk

Peninsular House  |  30-36 Monument Street  |  London  |  EC3R 8NB

Whilst we take care to ensure that the material in this Case Alert is correct, it is made available for information only, and no representation is given as to its quality, accuracy, fitness for purpose, or usefulness. In particular, the contents of this Case Alert do not give specific legal advice, should not be relied on as doing so, are not a substitute for specific advice relevant to particular circumstances. Plexus Law accepts no responsibility for any loss which may arise from reliance on information or materials published in this Case Alert.

 

 

 

 

 

In the case of Charlotte Swift v Malcolm Carpenter [2018] Mrs Justice Lambert had to decide whether to adopt alternative approaches to Roberts v Johnstone including those put forward by the Personal Injuries Bar Association (PIBA).

The Claimant was a 43 year old who suffered serious lower limb injuries in a road traffic accident. She had a below knee amputation of the left leg as well as a significant crushing injury to her right foot. The Court had to determine a number of issues including the Claimant’s accommodation needs.

The Issue

The Claimant lived in West London in a property which the Judge estimated at £1.45m. Having heard evidence from both parties accommodation experts she found that the appropriate figure for special accommodation was £2.35m i.e. additional capital costs of £900k.

In Roberts v Johnstone the Court of Appeal held the extra cost of accommodation should not be calculated by the capital sum or the current mortgage rate because both approaches would result in overcompensation to the Claimant. The correct approach would be to allow the “going rate” of temporarily foregoing the use of the money required to fund the purchase of special accommodation. Stocker LJ found the “going rate” to be 2% per annum. He reasoned that, where the capital asset in respect of which the cost is incurred consists of house property, the inflation and risk element were secured by the rising value of such a property as bricks and mortar will maintain their value.

Lord Lloyd in Wells v Wells, saw no reason to regard the figure of 2% as sacrosanct. In light of expert evidence on the average net return on low risk Index-Linked Government Stock in the conjoined appeals before him, he increased the figure to 3%, thus bringing it in line with the discount rate to be applied for the calculation of multipliers for future loss.

In March 2017, the Government changed the discount rate to -0.75 %. The Judge explained that given the current negative discount rate to be applied for the purpose of calculating multipliers of future loss, the Claimant would, adopting the Roberts v Johnstone formulation, recover a nil award in respect of the £900k additional capital cost for special accommodation.

The Parties Submissions

The Claimant argued for four alternative approaches none of which link the multiplicand to the current discount rate:

1.   The cost of an interest only mortgage based on the current rate which was circa 3.8%. This percentage applied to the additional £900k and a full life multiplier would produce a figure of £1.89m.

2.   The Defendant to pay an interest only mortgage in the form of a Periodical Payments Order. Once again, if the Claimant achieved her predicted life expectancy this would exceed the difference in the capital cost between the Claimant’s injured and uninjured accommodation needs.

3.   To adopt the Roberts v Johnstone approach but to substitute a different rate of return namely 2%.

4.   An award to reflect the cost of renting special accommodation although the Claimant’s Counsel accepted this was not a serious option. The annual rent would be in the order of £48k which would once again produce a total sum well over the capital value of the property.

The Judge noted (1) – (3) reflected the submission of PIBA when they intervened in the appeal in JR (Protected Party via his mother and litigation friend) v Sheffield Teaching Hospitals NHS Foundation Trust [2017]. In JR the Judge was urged to either award a lump sum to reflect the difference in value between the two properties or an award reflecting the difference subject to a deduction of the general damages figure. However, the Judge considered he was bound by Roberts v Johnstone and awarded nothing for this head of damage.

Judgment

The Judge felt the real point being made by the Claimant was that the Roberts v Johnstone formula was no longer fit for purpose in the modern context of a negative discount rate. She noted the problems the formula could produce; she also noted the Court of Appeal had observed its imperfect principles which have held sway since George v Pinnock. She had no doubt she was bound by Roberts v Johnstone and it could not be sensibly argued otherwise. Each alternative formulation advanced by the Claimant would produce, if capitalised, a final figure greater than the loss which the formula is intended to address. In the circumstances she made no award in respect of the additional costs associated with the purchase of special accommodation.

Comment

The Claimant’s lawyers have been arguing with some confidence in JSM’s that Roberts v Johnstone is ripe for challenge even at the Court of first instance. In practice the argument which is pursued with the most conviction by Claimants is an award based on the interest only rate. Notwithstanding these submissions by the PIBA, Mrs Justice Lambert had no hesitation in concluding she was bound by Roberts v Johnstone. It follows that it will take an appeal to the Supreme Court to overrule Roberts v Johnstone.

If you would like to know more about this matter, please speak to your contacts at Plexus Law:

Philip D’Netto, Partner

T: 0161 245 7929   |   M: 07970 318 434   |   E: philip.d’netto@plexuslaw.co.uk

Lorien Helm, Partner

T: 0161 245 7930   |   M: 07584 147 890   |   E: lorien.helm@plexuslaw.co.uk

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Anthony Bushell, Partner

T: 01386 578 8863   |   M: 07866 634 085   |   E: anthony.bushell@plexuslaw.co.uk

Vale Chambers  |  110-112 High Street  |  Evesham  |  WR11 4EJ

Whilst we take care to ensure that the material in this Case Alert is correct, it is made available for information only, and no representation is given as to its quality, accuracy, fitness for purpose, or usefulness. In particular, the contents of this Case Alert do not give specific legal advice, should not be relied on as doing so, are not a substitute for specific advice relevant to particular circumstances. Plexus Law accepts no responsibility for any loss which may arise from reliance on information or materials published in this Case Alert.

 

Mercel Hislop v Laura Perde & Kundan Kaur v Committee of Ramgarhia Board Leicester [2018] EWCA Civ 1726

Issue

The consequences of a Part 36 offer at Trial are clearly set out at CPR 36.17 and include an award of costs on the indemnity basis, punitive interest at 10% above base rate and an additional 10% of damages. The question of the outcome where a Defendant accepts a Claimant’s Part 36 offer out of time but before Trial is governed by CPR 36.13(4) and requires the Court to decide the appropriate Order. That question has been answered differently by several County Court Judges at first instance and on first Appeal. Some Judges have awarded costs on the indemnity basis for the period post expiry of the Part 36 offer and therefore following the decision of Broadhurst v Tan the Claimant has recovered hourly rate costs as opposed to the usual fixed costs for that later period.

This has become any increasingly prevalent tactic of Claimants seeking to maximise their costs recovery by escaping the fixed costs that would otherwise be awarded to them. The issue is therefore of great importance to Defendants as this escape from fixed costs can have meaningful implications to reserves and litigation strategy generally.

Facts

The Hislop case was a modest value Road Traffic claim where the Defendant accepted the Claimant’s Part 36 offer out of time and shortly before Trial. The Kaur case was a modest value Public Liability claim where following unfavourable expert opinion the Defendant instead of accepting the Claimant’s Part 36 offer at £2,000 made their own Part 36 offer at £3,000 which was accepted by the Claimant. In both cases the Judges below had decided that the Claimant was entitled to assessed costs rather than fixed costs, but such costs should be assessed on the standard basis not the indemnity basis.

Decision

The Court accepted as a starting point the encompassing nature of Part 45 and the rather limited exceptions and escapes to that regime. The Court considered the previous authority of Broadhurst v Tan and clarified that the situation following judgment at Trial and an offer accepted late but before Trial were very different. The Broadhurst decision was founded upon CPR 36.17, however, that Rule was of no assistance to a Claimant who did not proceed to Trial.

In considering the general approach to late acceptance of Part 36 offers the Court said that “.. the general position is that the late acceptance of a Part 36 offer may warrant an order for indemnity costs. But that will always be a question of fact in each case; there is no presumption to that effect.”

The Court held that the effect of the Rules is that (aside from a case proceeding to Trial and thus invoking CPR 36.17) the fixed costs regime in Part 45 applies rather than the general provisions of Part 36. Therefore on late acceptance the power to order assessed costs under CPR 36.13  does not arise. The Court finding that CPR 36.20 makes provision for costs consequences in fixed costs cases and such qualifies the reference to standard costs with the words “except where the reasonable costs are fixed by these Rules.”

Therefore it was held that the only escape from fixed costs is by reference to CPR 45.29J invoking exceptional circumstances. It was held however, that late acceptance of a Part 36 offer should not give rise to a presumption that exceptional circumstances were made out, but rather each case was fact specific. The Court said “A long delay with no explanation may well be sufficient to trigger rule 45.29j; a short delay with a reasonable explanation will not.”

The Court rejected the argument that this provision would only come in to play if it were shown the exceptional circumstances had caused the litigation to be more expensive as this would lead to “An unnecessarily restrictive view of the rule.” The Court did however, acknowledge that “It goes without saying that a test of exceptional circumstances is already a high one.”

The appeals in both cases were therefore allowed with the Claimants awarded only fixed costs.

Comment/Conclusion

The only escape from fixed costs pre-trial is exceptional circumstances under CPR 45.29j. Late acceptance itself may well not be enough to trigger that. The test generally is a high one. If the Claimant fails on that test the Defendant will be awarded the costs of that exercise with such costs likely to be offset against the fixed costs awarded.

In non-fixed costs cases it will not now be enough for Claimants to simply rely on late acceptance for indemnity basis costs awards, the reason and length of delay are crucial. This will have impact on cases where indemnity basis assessments are desirable due to obviating the operation of the test of proportionality or seeking to escape the restrictions of a low budget/Costs Management Order.

If you would like to know more about this matter, please speak to your contact at Plexus Law:

Chris White, Technical Director

T: 0113 468 1659   |   M: 07557 430 241   |   E: chris.white@plexuslaw.co.uk

Joseph’s Well  |  Hanover Walk  |  Leeds  |  LS3 1AB

Whilst we take care to ensure that the material in this Case Alert is correct, it is made available for information only, and no representation is given as to its quality, accuracy, fitness for purpose, or usefulness. In particular, the contents of this Case Alert do not give specific legal advice, should not be relied on as doing so, are not a substitute for specific advice relevant to particular circumstances. Plexus Law accepts no responsibility for any loss which may arise from reliance on information or materials published in this Case Alert.

 

 

In the recent case of ABC (through her litigation friend) v DFT [2018] His Honour Judge Yelton had to assess damages for a Claimant with significant pre-existing learning difficulties.

The Claimant was aged 17 when she was involved in a road traffic accident. She sustained multiple injuries including significant psychiatric and psychological problems. There was a dispute whether she sustained a minor brain injury although the Judge preferred the evidence of the Claimant’s neurologist, Professor Hutchinson to his counterpart, Dr Foster on the issue.

Prior to the accident the Claimant had suffered from significant learning disabilities. At aged 13 she was said to have a reading age of 7. Her IQ two years before the accident was 67. Aspects of her memory were below the first percentile of her peers. She was unable to read time from a clock face.

Notwithstanding these difficulties she was attending an educational unit three days a week and held two part-time jobs, as a barmaid and helping out in some stables.

In respect of her pre-accident position the Judge found she could not realistically ever have lived unaided on her own.

Her predominant disability following the accident was psychological.

The Defendant’s psychiatric expert, principally Professor Declan Murphy argued that with a programme of multi-disciplinary rehabilitation she would revert to her pre-accident state. The Judge found Dr Murphy to be an impressive witness and accepted his evidence, albeit with some modification in relation to the recovery period. The Judge was, however, critical of Insurers for refusing to fund the rehabilitation at an earlier stage. On the balance of probabilities he found that it would take two years from the judgment to recover.

This had a significant effect on her claim which was pleaded at over £7m including £5m for care. While the Judge accepted that some experts had assessed heads of loss on a worst case scenario he still felt the analysis put forward by the Claimant’s care expert was unrealistic in the extreme.

There was a dispute between the parties in relation to the method and costs of administering her damages/Court of Protection Fees. The Defendant’s expert argued the Claimant should have a Trust rather than a Deputy. The Defendant relied on the observations of Mr Justice Charles in Watt v ABC [2016]. The Judge found a Trust was both impractical and inappropriate. It would also be unfair on the Claimant’s parents, neither of whom had any expertise in dealing with large sums of money.

Notwithstanding the Judge’s findings on the recovery period the Claimant’s expert still quantified Court of Protection fees at £872,787. Once past losses and rehabilitation were stripped out the award of damages was circa £220,000, and much of this was likely to be spent on purchasing a house within the reasonably near future. The Judge found the sum claimed was grossly disproportionate. It could not be fair to a Defendant or proper in a developed legal system to pay the costs of managing an award of damages which were about four times its capital sum. However, the Judge did not find the figures put forward by the Defendant’s experts to be helpful either although the proper approach would be to come to a jury figure. He awarded a figure of £125,000 for Court of Protection fees, albeit that may also be too generous to the Claimant.

Comment

This case demonstrates the importance of a forensic approach to Claimants with significant pre-existing disabilities. It also shows that Rehabilitation can be more than a “tick box exercise” and in the right case Defendants should be prepared to fund rehabilitation, in order to realise gains against future losses. It is noteworthy that while the Judge was critical of the Defendant for failing to fund the rehabilitation they  did change their position before Trial and had applied for an adjournment to allow the rehabilitation to take place .

It is difficult to understand how, notwithstanding the Judge’s findings on the recovery period, the claim for Court of Protection fees was so high. It appears the Judge found little assistance from either expert on this issue. It is hoped that more Judges will treat this as a “Jury issue” because in many cases the experts can do no more than guess at the likely future costs associated with managing a damages fund. Another issue in practice, not addressed in this case, is how the Claimant’s solicitors can also act as the Deputy. There arguably creates a conflict where the Claimant’s personal injury lawyers have to advise on offers made by Defendants for Court of Protection fees which the same firm will incur. Some commentators believe this is an area the Office of Public Guardian should address.

If you would like to know more about this matter, please speak to your contacts at Plexus Law:

Philip D’Netto, Partner

T: 0161 245 7929   |   M: 07970 318 434   |   E: philip.d’netto@plexuslaw.co.uk

Daniel Clegg, Partner

T: 0161 245 7911   |   M: 07890 590 188   |   E: daniel.clegg@plexuslaw.co.uk

City Tower  |  Piccadilly Plaza  |  Manchester  | M1 4BT

Whilst we take care to ensure that the material in this Case Alert is correct, it is made available for information only, and no representation is given as to its quality, accuracy, fitness for purpose, or usefulness. In particular, the contents of this Case Alert do not give specific legal advice, should not be relied on as doing so, are not a substitute for specific advice relevant to particular circumstances. Plexus Law accepts no responsibility for any loss which may arise from reliance on information or materials published in this Case Alert.

NB: this Case Alert is a commentary piece on a non-Plexus case.

This appeal considered whether a Defendant can enforce an adverse costs order against damages recovered by a Claimant from a Co-Defendant under the QOWCS regime.

The Background

The Claimant issued a claim for noise induced hearing loss “NIHL” against six named Defendants. The third Defendant to the initial action, Venduct Engineering Limited (“Venduct”) accepted that it was responsible for any liability that was established on the part of D1 and D2. The Claimant discontinued against D1 and D2 by consent.

The Claimant subsequently compromised its claim against D4 – D6 by way of a Tomlin order.

At about the same time, the claimant served a notice of discontinuance in respect of the claim against Venduct. Venduct’s solicitors asserted that they had the right to recover the costs which they had incurred as a result of the Claimant’s claim. They maintained that this could be paid out of the Claimant’s damages, which were paid by D4-D6.

In response, the claimant said that it had the protection of the QOWCS regime. In addition, the Claimant alleged that, since the sums from D4 – D6 were paid by way of a Tomlin order, Venduct could not rely on r.44.14 in any event.

The Issues

There were 2 main issues in this case.

Issue 1: Can one Defendant take advantage of damages paid to the claimant by another Defendant?

In summary, yes.

This issue was concerned with the proper interpretation of r.44.14.

The Court of Appeal upheld Cost Judge Hale’s decision on the applicability of the QOWCS regime to multi-defendant cases. It was found that where the Claimant had sued more than one party freely there was no reason why one defendant should not recover costs against the Claimant, where the Claimant was successful against a second Defendant. The rule intended to permit enforcement.

The overriding theme within the Judgment was that the Claimant should be discouraged from bringing proceedings which were unlikely to succeed.

This is a positive for Defendants and ensures they are not faced with having to defend hopeless claims only to have them shortly discontinue prior to trial.

Issue 2: Does It make a difference if sums are due by way of a Tomlin Order?

In summary, again, yes.

Enforcement is not possible when the sums payable arise from a Tomlin order.

CPR 44.14(1) requires “an order of the court”. A Tomlin order is not a “court order” and thus is outside the scope of the section. Whilst the Tomlin order itself is enforceable, the schedule is not an order of the court at all. The schedule instead reflects the agreement reached between the parties and CPR 44.14 did not apply.

There are also practical difficulties if a lump sum figure for damages and costs was agreed in a Tomlin order. How can a court go about identifying the relevant figure for the purposes of establishing the damages cap against which costs can be recovered when the damages figure agreed upon is a global figure to include costs?

Implications for Defendants

The Court of Appeal’s decision has important ramifications for the approach to multiple defendant litigation in personal injury proceedings.

Whilst a Defendant can recover costs from a Claimant against damages awarded to that Claimant from a Co-Defendant, this is only if that award was made by way of court order.

The amount that is payable to the Claimant by way of damages and interest is a cap on the amount which a Defendant can seek by way of enforcement of any costs order(s) in its favour. If the Claimant is unsuccessful, then the Defendant will recover nothing, despite those costs orders.

Practically what should we do:

1. It is more important than ever at the outset of cases to assess our early prospects of success in defending the file. We need to advise our client about the potential for a costs recovery, but ensure advice is given regarding the implications if the Claimant is unsuccessful, or the claim is settled by way of Tomlin Order.
2. It will be imperative to have good relationships with the other parties and engage in early discussions any other Defendants to any actions. A good working relationship should allow us to be able to ask for any settlement to be done by way of a Consent Order rather than a Tomlin Order, which will ensure any potential costs recovery is not stymied.
3. As always, keep proportionality in mind. Even if we are successful in recovery of costs, the amount recoverably is limited to the amount of the Claimant’s damages and interest.

If you would like know more about this Case Alert, please speak to your contacts at Plexus Law:

Andrew Steel, Partner

T: 0161 2457  965   |   M: 07557 232 419  |   E: andrew.steel@plexuslaw.co.uk

Rebekah Tomlinson, Associate Partner

T: 0161 244 6928   |   E: rebekah.tomlinson@plexuslaw.co.uk

City Tower  |  Piccadilly Plaza   |  Manchester   | M1 4BT

Whilst we take care to ensure that the material in this Case Alert is correct, it is made available for information only, and no representation is given as to its quality, accuracy, fitness for purpose, or usefulness. In particular, the contents of this Case Alert do not give specific legal advice, should not be relied on as doing so, are not a substitute for specific advice relevant to particular circumstances. Plexus Law accepts no responsibility for any loss which may arise from reliance on information or materials published in this Case Alert.