Source: https://zenithpi.wordpress.com/2018/05/01/3027/
Timestamp: 2019-02-21 00:11:17
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Matched Legal Cases: ['art 8', 'EWCA ', 'art 36', 'art 36', 'art 36', 'art 7', 'art 44', 'art 44', 'art 44', 'art 44', 'art 8', 'art 8', 'art 8']

​FIXED COSTS ONLY WHERE PRE-ACTION PROTOCOL NOT FOLLOWED | Zenith PI: PERSONAL INJURY LITIGATION IN PRACTICE
May 1, 2018 ·	by zenithpi ·	in Uncategorized	· Leave a comment
An unreasonable failure to follow the Pre-Action Protocol for Low Value Personal Injury
(Employers’ Liability and Public Liability) Claims before settling a claim pre-issue will very likely lead to only fixed costs being recovered and the time to raise such an argument is when filing an acknowledgment of service to Part 8 costs-only proceedings.
The Court of Appeal considered this specific scenario in Williams -v- The Secretary of State for Business, Energy & Industrial Strategy [2018] EWCA Civ 852 in the context of a claim for Noise Induced Hearing Loss (“NIHL”).
The full decision of the Court of Appeal can be found here:
http://www.bailii.org/ew/cases/EWCA/Civ/2018/852.html
Mr. Williams claimed that he had suffered NIHL as a consequence of exposure to excessive levels of noise when employed by National Coal Board (whose liabilities devolved to the named Defendant) between 1977 and 1991 and by British Tissues between 1991 and 1993 and 1997 to 2008.
The Claimant’s solicitors did not follow the Protocol, but relied upon paragraph 4.3(6) where, under the heading “Scope” it states that,
“4.3 This Protocol does not apply to a claim-
(6) in the case of a disease claim, where there is more than one employer defendant;”
In late 2013 and early 2014 Pre-action Letters of Claim were served upon both former employers. In response, British Tissues disclosed a copy of Mr. Williams’ contract of employment under which it was a condition that he wear hearing protection. It also disclosed other documents which made it clear that the proposed claim against it had no merit.
However, the claim continued to be pursued against the Defendant. Expert medical evidence and a witness statement were served and, following a subsequent exchange of formal settlement offers, on 23rd December 2014 Mr. Williams accepted a Part 36 offer of £2,500. Argument then ensued over the correct measure of costs.
The Claimant contended that standard costs should apply following his acceptance of a Part 36 offer, but the Defendant said the exception to use of the Protocol did not apply because there was no reasonable prospect of British Tissues being a defendant and so he should be limited to fixed costs.
At first instance, DDJ Morris decided that the claim should have been brought under the Protocol and that the Claimant was limited to fixed costs applying CPR r.45.24. He decided that if proper Instructions had been given by Mr. Williams at the outset then his solicitors would have appreciated that a claim against British Tissues would have been very weak. DDJ Morris said,
“However in this case with which I am dealing and which we now know and the solicitors would have known had they received full instructions at the outset from the claimant that any potential claim against the other proposed defendant was a very weak prospect. Perhaps to the point where if the claimant had given fuller instructions his solicitors would have taken a commercial as well as legal view as to whether they investigated the proposed defendant at all, or whether they simply opened correspondence as part of a ‘fishing’ enquiry to confirm what they knew or should have been told.”
The DDJ’s findings in these respects were not challenged on appeal.
The first appeal was heard by HHJ Gosmark Q.C. who held that CPR r.45.24 did not apply and the acceptance of a Part 36 offer created a contract, the terms of which were set out in the offer. Consequently, the Claimant was entitled to costs to be assessed on the standard basis.
The Court of Appeal explained that CPR rule 45.24 does not provide assistance where the pre-conditions of Part 7 proceedings and Judgment have not occurred despite it being a detailed provision setting out the costs consequences which apply where a claim is either not made or not continued under the EL/PL Protocol.
At paragraph 56 of his Judgment, Coulson LJ expressly referred to CPR r.44.11 and explained that that rule provided the appropriate mechanism for limiting costs when an assessment is carried out,
“52. These provisions contain numerous ways in which a party whose conduct has been unreasonable can be penalised in costs (what I shall call “the Part 44 conduct provisions”). In my view, the Part 44 conduct provisions provide a complete answer to a case like this. They provide ample scope for a District Judge or a Costs Judge, when assessing the costs in a claim which was unreasonably made outside the EL/PL Protocol, to allow only the fixed costs set out in the EL/PL Protocol.”
The provisions in CPR Part 44 provide the answer to giving effect to the warning contained at paragraph 7.59 of the Protocol in a claim that settles pre-issue,
“7.59 Where the claimant gives notice to the defendant that the claim is unsuitable for this Protocol (for example, because there are complex issues of fact or law or where claimants contemplate applying for a Group Litigation Order) then the claim will no longer continue under this Protocol. However, where the court considers that the claimant acted unreasonably in giving such notice it will award no more than the fixed costs in rule 45.18”.
As Coulson LJ continued, at paragraph 62,
“62. … For the reasons that I have given, it will usually follow that a claimant who, on this premise, has only incurred a higher level of costs because he or she has unreasonably failed to follow the EL/PL Protocol, will be restricted under Part 44 to the fixed costs and disbursements encompassed by that Protocol”.
When should conduct issues be raised ?
The Court of Appeal gave guidance that the appropriate time to raise such conduct arguments is at the time of filing the acknowledgment of service to Part 8 costs only proceedings,
“63. We were also asked to indicate the best way in which an argument about whether or not the costs should be restricted in this way should be raised and addressed. I note that, pursuant to CPR 46.14, it is envisaged that, following settlement, costs-only proceedings can be issued under Part 8. That is what happened here. In my view, a defendant who wants to argue that the claimant should be restricted to fixed costs only should raise that submission as soon as possible in the Part 8 proceedings. Under 46PD 9.7 that would probably be when the defendant files an acknowledgment of service stating its intention “to contest the claim or to seek a different order”.
For further information please contact the Clerk of ​Simon Ross, ​Paul McNab. Or to hear more from our PI team come along to one of our ​Wine & Wisdom Seminars.
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