CLAIMANT CAN RECOVER COSTS AGAINST A DEFENDANT NOT NAMED IN THE CFA
In Engeham -v- London & Quadrant Housing Ltd & Academy of Plumbing Ltd (01/12/2015) * the Court of Appeal upheld a finding that a consent order which stated that damages and costs were to be paid by a defendant not named in the Conditional Fee Agreement was a “win” which entitled the claimant to recover costs from that defendant.
- The claimant was injured when a ceiling fell on her.
- She signed a CFA which named her landlord, London Quadrant Housing Group, as the defendant.
- Proceedings were issued against four defendants, the action against two was discontinued before they were served. The Housing Group was named as the first defendant.
- The action was settled against a defendant not named in the CFA.
- At first instance it was held that the CFA did not cover an action against that defendant and no costs could be recovered.
THE DECISION ON APPEAL TO THE CIRCUIT JUDGE
On appeal to HH Judge Mitchell (sitting with Senior Master Hurst) the argument that the wording of the CFA, in itself, covered the action was rejected.
However the terms of the settlement were that
“upon payment by the second defendant of the agreed sum and costs, the first defendant and second defendant be discharged from all further liability to the claimant in respect of the claims made by the claimant in this action.”
“The claimant has agreed to accept the sum of £1,000 in full and final settlement of the claims brought in this action” (this was in the plural).
The court held:
- The definition of “win” in the conditional fee agreement is not restricted to who pays.
- The meaning of win should be widely construed as “in any way you derive benefit pursuing the claim”.
- The claimant had derived benefit from pursuing the claim.
- The appeal was allowed on this second ground.
THE COURT OF APPEAL DECISION
The Court of Appeal upheld the decision of HH Judge Mitchell:
- It was not realistic to say that the claimant had not won.
- The Tomlin order was an agreement to pay damages for the purpose of the CFA.
- It was not relevant that it was the second defendant paying
(* This post is based on the Lawtel summary of the Court of Appeal decision and the full transcript of the appeal before HH Judge Mitchell).