A DISPOSAL IS A "TRIAL": COURT OF APPEAL DECISION TODAY

November 11, 2016 · by · in Appeals, Assessment of Costs, Costs, Uncategorized

Several people have kindly sent me details of the Court of Appeal decision in Bird -v- Acorn Group Limited [2016] EWCA Civ 1096.  The Court considered whether a matter listed for a disposal under the EL/PL Protocol was a “trial” under the fixed costs regime.

“In my judgment listing a case for a disposal hearing following judgment, pursuantto Part 26PD12, is listing for trial, for the purposes of triggering column 3 in Table 6D part B where a case which originated in the EL/PL Protocol settles after listing”

KEY POINTS

  • An action listed for disposal under the EL/PL Protocol attracts the same costs provisions as an action listed for trial.

THE CASE

An action subject to the Protocol had been listed for disposal. It settled before the disposal hearing. There was an issue as to which table the  fixed costs fell into.  The central issue was whether a matter listed for “disposal” was the same as listing a matter for “trial”.

THE DISTRICT JUDGE: LISTING FOR DISPOSAL WAS LISTING FOR TRIAL

The District Judge found that listing the matter for a disposal was the same as listing the matter for trial and the higher cost provisions applied.

THE COURT OF APPEAL  UPHOLD THAT DECISION

Lord Justice Briggs stated:-
  1. In my judgment listing a case for a disposal hearing following judgment, pursuantto Part 26PD12, is listing for trial, for the purposes of triggering column 3 in Table 6D part B where a case which originated in the EL/PL Protocol settles after listing. My reasons follow.
  2. First, listing a case for “disposal” means exactly what it says. The purpose of doing so is, so far as possible, finally to dispose of the case at first instance. A default or other judgment for damages to be assessed leaves that assessment outstanding, as the last stage in the final disposal of the proceedings. For that purpose it matters not whether the judgment has been obtained by default (as here) or on an application for summary judgment on liability, judgment on admissions, or after a liability only trial: see generally Part 26PD12(2).
  3. The fact that it may be impossible to tell, prior to the disposal hearing itself, whether it will prove to be final in that sense, or merely the occasion for giving of directions, cannot be conclusive against listing of a disposal hearing triggering column 3 of Table 6D part B, because that table is concerned with settlement prior to trial. If the possibility of a disposal hearing being used for the giving only of directions were to be admitted, then it is hard to see how listing could ever be a trigger for the application of column 3 following a settlement. Even the hearing date of a full trial may turn into a hearing for directions if it proves impossible or unjust to do otherwise than permit an adjournment.
  4. Secondly, the fact that a disposal hearing might prove to be uncontested is, again, neither here nor there. It is common ground that, even after a judgment in default, the defendant may attend and oppose the claimant’s case as to quantification of damages at the disposal hearing. Again, if the possibility that such a hearing might prove to be uncontested were sufficient to prevent its listing being a trigger for the application of column 3, then that possibility exists at all kinds of final hearing, including traditional trials.
  5. Thirdly, and as DJ Campbell emphasised, listing for a disposal hearing is the trigger for the claimant (and any other party which wishes to take an active part at that hearing) to prepare and serve the requisite evidence. Addressing the submission that there could be no move to column 3 if there had not previously been allocation to trigger column 2, she said, at paragraph 29 of her judgment:
“I am supported in this view by Mr Latham’s submission that much work is to be done in cases which are heading to a disposal hearing, including the gathering of witness evidence, the preparation and service of written evidence which is specifically required by Practice Direction 26. 12.4(5). Indeed, there are a large number of cases which settle just before the disposal hearing or on the morning of it and I can take judicial notice of that fact as a judge who regularly deals with disposal lists. It cannot be right that those cases attract the same amount of costs as a case that settles after issue but before any allocation by the court which, if I were to accept the defendant’s submissions, all those cases which will be months down the line from the listing of the disposal will only attract the costs in column one.”
This court is entitled to give weight to these observations from a judge with large experience in this particular field. Furthermore, the appellant gains nothing from the fact that this particular disposal hearing was listed for a 10 minute hearing. The County Court at Birkenhead deals with the quantification of damages in relatively small claims of this kind within ten or fifteen minutes on a regular basis, even if opposed, with counsel on both sides. The cases are routinely disposed of on the papers, without oral evidence, after full pre-reading by the judge, and with the benefit of the most succinct submissions, in every respect proportional to the modest amounts usually at stake.
  1. Fourthly, there is a useful pre-history to the formulation “final contested hearing” in Part 45.29E(4)(c). Part 45.15 deals with the success fee percentages applicable in road traffic accident claims. By Part 45.15(6)(b), as it was before April 2013, a reference to “trial” was a reference to the final contested hearing. This rule was introduced in 2004. Lamont v Burton [2007] 1WLR 2814 was about a road traffic accident claim which had concluded at a disposal hearing. It was taken for granted in this court (rather than determined after argument) that the disposal hearing had been a trial for the purposes of Part 45.15. I consider it very likely that, when it adopted the same definition of trial in 2013, for the purposes of fixed costs in EL/PL Protocol cases, the Rule Committee had the analysis in Lamont v Burton well in mind.
  2. By contrast the Forcelux case, relied on by Mr Turner, was about a first hearing of possession proceedings under Part 55, which occurs at the beginning of a claim, rather than (as here) after judgment. The court may determine the claim summarily or give directions for a trial. This court held that a first hearing of a possession claim was not a trial for the purposes of Part 39.3 which, by sub-rule (5) lays down conditions which must be complied with by a person who seeks to set aside the judgment having failed to attend the trial. Not only is a first hearing under Part 55 very different from a disposal hearing of the type with which this appeal is concerned, but the definition of trial for the purposes of Part 39.3 is the general meaning of the word trial in the CPR, rather than the special meaning given for the purposes of fixed costs tables or the quantification of success fees. The Forcelux case is therefore of no assistance to the appellant.
  3. Returning directly to Mr Turner’s submissions, his biggest difficulty was his inability to submit, with any force, (although he did not completely abandon the point) that a contested disposal hearing in which damages actually were assessed was not itself a trial within the meaning of the “final contested hearing” definition. It is noteworthy that the formula for quantifying fixed costs at a trial in Table 6D part C is exactly the same as that in the third column of the table in part B, where a case settles before trial, save only for the relevant trial advocacy fee. Bearing in mind the experience of the District Judge that many disposal hearings do settle shortly before trial, it seems most unlikely that the Rule Committee can have intended to leave the claimant to the much lower column 1 level of recovery after such a settlement, having done all of the work necessary to achieve finality at the disposal hearing, and being entitled to fixed costs equivalent to column 3, plus the trial advocacy fee, if the matter proceeded all the way to a disposal hearing.
  4. Nor do I accept Mr Turner’s submission that if column 3 is triggered when a disposal hearing is listed for trial, there will be no incentive for insurers to settle. Settlement saves the insurer its own costs of preparing for a contested hearing, and both its own and the claimant’s advocacy fees.
  5. Perhaps the most persuasive of Mr Turner’s excellent submissions, initially at least, was the apparent back-tracking from column 3 to column 2 which might occur if, at a disposal hearing, the court were to allocate the case and give directions, but not a listing, for a fast track trial. This lay at the heart of Mr Turner’s submission that the three columns in Table 6D part B were intended to be sequential. But Mr Williams QC for Mr Bird had what seems to me a complete answer to it. First, he pointed out that, even in a case where there was allocation to the fast track, it was common for there to be no moment in time at which column 2 applied, because Part 28.2(2)(a) provides for County Court hearing centres to allocate to the fast track and list for trial simultaneously. Secondly, and more fundamentally, he submitted that, on Mr Turner’s example of a disposal hearing which led to an allocation, there would be no need for a reversion to column 2. The claimant would by then have done all of the work necessary to obtain finality at the disposal hearing, and incurred costs for which column 3 was a proportionate recompense. There will be no need to force the claimant back to column 2 merely because, as the result of allocation, yet further work had to be done. The three columns were sequential, in the sense that once a particular column beyond the first had been reached, there could be no back-tracking. I found that submission entirely persuasive.
  6. I was not persuaded by Mr Turner’s submission based on Part 45PD 4. This section of the Practice Direction applies to fast track trial costs, but not where the case starts in the EL/PL Protocol.
  7. Finally, there are passages in Jackson LJ’s Interim Report, in particular at paragraph 1.12 and following in chapter 22, which suggest that the three columns in what is now Table 6D part B were intended usually to be steps in a ladder. But those general observations do not detract from the interpretation of the definition of trial at which I have arrived. In every case where a claimant obtains judgment for damages to be assessed, followed by a disposal hearing for that assessment, there will be a progression from column 1 (which comes into force when proceedings are issued) to column 3, when the disposal hearing is listed. The fact that column 2 is jumped over because there is no intermediate allocation to the fast track seems to me to be just one of those events which means that the three columns will not always be triggered in succession. But that by no means undermines the good sense of a conclusion that, once there has been a listing for a disposal hearing, column 3 is triggered.
  8. For those reasons I would dismiss this appeal. I will conclude by paying tribute to the expert assistance which we received from the Senior Costs Judge Master Gordon Saker, who sat with us on this appeal as an assessor.

 

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