COSTS WHERE A PARTY SUES A NUMBER OF DEFENDANTS: DEFENDANTS ORDERED TO PAY SUCCESSFUL DEFENDANT’S COSTS: HIGH COURT APPEAL

I am grateful to Thomas Riis-Bristow, Associate Solicitor at Irwin Mitchell, for sending me a copy of the judgment of Mr Justice Lavender in McDermott -v- Inhealth Limited (19/07/2018),  This deals with the issue of the appropriate costs order when a claimant is successful against some, but not all, defendants.

THE CASE

The claimant was a professional boxer.  Unbeknown to him he had an aneurysm in his brain. In 2010 he underwent an annual mandatory check up as a condition of renewal of his boxing licence.

  • The imaging was carried out by the second defendant, in Health Limited.
  • The protocol for renewal did not require a “GE” scan, however the third defendant carried out such a scan.   This scan showed the aneurysm.  This was never disclosed to the claimant.
  • There was an unresolved issue whether this was because the third defendant never sent the scans to the second defendant, or the first defendant (a consultant neuroradiologist).

PRE-ACTION CORRESPONDENCE

Prior to the issue of proceedings none of the three defendants admitted liability. Each blamed the other.  The second defendant blamed the first defendant, neuroradiologist.

THE ISSUE OF PROCEEDINGS

The claimant issued proceedings. Initially proceedings were issued only against the neuroradiologist.  The pleadings were later amended to include the second and third defendants.

CLAIMANT’S PROPOSED MEETING

Very early on in the litigation the claimant proposed a joint settlement meeting. This never happened.

THE JUDGE’S COMMENTS ON THE CLAIMANT’S CONDUCT AT THE EARLY STAGE

The judge commented that, at this stage, the claimant had acted totally reasonably in joining all three defendants into the action.   No defendant had admitted liability and the claimant was not responsible for the complexities that he faced.

THE “PROTOCOL” CLAIM AGAINST THE SECOND DEFENDANT

There was an additional allegation against the second defendant. That the second defendant was negligent in the design of the protocol that governed medical examinations for renewal of the boxing licence.  There should have been a mandatory requirement for a GE scan.  This was referred to as the “protocol” claim. The “scans” claim involved allegations of negligence against all three dfne

THE DEFENCE

Each defendant filed a defence denying liability.

  • The third defendant stated it had sent the scan images to the second defendant, alternatively that it owed no duty of care as it had not been engaged to undertake a GE scan.
  • The second defendant denied that the GE images were sent to it, alternatively if they had they would have been sent to the first defendant. It also argued that its duty of care was limited to complying with the exam required for the boxing licence.
  • The third defendant denied he owed the claimant a duty of care and also contended that the scans were not sent to him, alternatively if they had been sent that he would not have reviewed them.

THE SETTLEMENT

The second and third defendant made an agreement that they would be liable for the claimant’s damages.  Consequently the second defendant wrote and stated it would be liable for the claimant’s damages.  Given this the claimant discontinued his claim against the third defendant with (as agreed between them) no order for costs.  The claimant also discontinued against the first defendant and was liable to pay his costs.   The issue arose as to the extent to which the second defendant should indemnify the claimant against the first defendant’s costs.

THE ORDER OF THE DISTRICT JUDGE

The District Judge made a limited “Bullock Order”. He ordered the second defendant to pay the costs that the claimant was liable to pay the first defendant, and the claimant’s own non-generic costs of the action, but only after December 2016. The District Judge held that it was unreasonable for the second defendant not to admit liability after that date as it had received a report that indicated it was responsible and it should have admitted liability.

THE CLAIMANT’S SUCCESSFUL APPEAL

The claimant appealed against the District Judge’s order.   On appeal the High Court judge held:

  • It was reasonable for the claimant to bring claims against all three defendants.
  • It was reasonable for the claimant to discontinue against the first and third defendants once he had obtained an admission of liability by the second defendant.
  • The District Judge had erred in finding that the “protocol” claim and the “scans” claim were different causes of action against each defendants.  They were sufficiently linked to make a Bullock order appropriate.

Consequently it was held that the District Judge was wrong to treat the protocol claim as an independent claim. The High Court judge looked at the matter afresh and held that it was appropriate to order that the second defendant be liable to pay all of the costs that the claimant was liable to pay the first defendant and all of the claimant’s generic costs against the action against the first and third defendants.

“The Claimant acted reasonably in suing these three defendants, who were blaming one another, and it would not be unjust to order the Second Defendant to bear costs which were reasonably incurred in consequence of the Second Defendant’s negligence”.