I am grateful to Gary Brankin and Jeremy Rae of BC Legal for providing more information about the decision in Cartwright v Venduct Engineering Ltd [2018] EWCA Civ 1654, the court of Appeal decision on QOCS considered yesterday. This is a point on the costs of the appeal that is not apparent from the judgment itself.
Since the post was first written I was kindly sent a copy of the supplementary judgment by Jeremy Rea, also of BC Legal. A copy of the judgment is available
COSTS OF THE APPEAL
BC Legal informs me that when the issue of the costs of the appeal came up the Court of Appeal endorsed the approach in Howe -v- MIB No 2 (CA 6th July 2017). It allowed the defendant to offset the costs it should have received following discontinuance against the costs they were ordered to pay in respect of the appeal. It is worthwhile looking at the decision of the Court of Appeal on costs in the Howe case.
THE DECISION IN HOWE -V- MIB (NO 2)
In the substantive appeal in Howe the claimant succeeded in establishing that his action against the Motor Insurers Bureau was covered by QOCS. In a later judgment the Court of Appeal considered whether the MIB should be allowed to set off the costs of the appeal against the costs of the main action that they could not recover because of the operation of QOCS.
The Court of Appeal held that CPR 44.12 gave the court a discretion to order a set-off of costs and that, on the facts of that case the costs orders in his favour should be set off against costs orders existing in favour of the MIB. The Court of Appeal in the Howe case held
“6 In my judgment, it would be just for the costs awarded to Mr Howe to be set-off against costs orders in favour of MIB.
7 MIB, however, goes further, and seeks to enforce the costs orders of the ground that Mr Howe’s appeal was struck out. CPR Part 44.15(1) provides: “Orders for costs made against the claimant may be enforced to the full extent of such orders, without the permission of the court where the proceedings have been struck out on the grounds that (a) the claimant has disclosed no reasonable grounds for bringing the proceedings.” In my judgment, the appeal on liability was part of the same proceedings as the original claim tried by Mr Justice Stewart. ·
8 The conclusion is supported by the decision of the Supreme Court in Plevin v Paragon Personal Finance Ltd. No.2 [2017] UKSC 23, [2017] 1 WLR 1249, in which Lord Sumption said, at para.20:
“The starting point is that as a matter of ordinary language one would say that the proceedings were brought in support of the claim and were not over until the court had disposed of that claim one way or the other at whatever level of the judicial hierarchy. The word is synonymous with action.”
In some contexts, the word “proceedings” can have a narrower meaning, but I do not consider that this is one of them. Moreover, even if one were to chop up the various stages in the overall action Mr Howe had reasonable grounds for bringing, and I stress the word “bringing” his appeal, because it was not until after the appeal was brought that the law changed. I consider, therefore, that the MIB are not entitled to rely on CPR Part 44.15(1).
9 I conclude, therefore, that Mr Howe should have his costs of the costs issue, both here and below, but that the order in his favour should be set off against costs orders existing in favour of the MIB.”
THE ORDER MADE ON THE APPEAL IN CARTWRIGHT
“UPON HEARING leading counsel for the appellant and counsel for the respondent
IT IS ORDERED THAT:
(1) The appeal is dismissed.
(2) Paragraphs 5 to 9 of the additional grounds for upholding the costs judge raised by respondent’s notice are dismissed.
(3) The appellant shall pay 70 per cent of the respondent’s costs of the appeal, to be subject to detailed assessment on the standard basis if not agreed.
(4) The appellant may set-off the costs payable to the respondent under paragraph (3) above against the costs payable by the respondent by virtue of his discontinuance of the claim against the appellant”
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