I am grateful to Matthew Hoe from Taylor Rose TTKW for sending me a copy of the judgment of HHJ Sephton QC in Lovatt -v- Lew Diecastings Ltd (County Court in Manchester, 4th December 2018). Lovatt v LEW Diecastings Ltd [2019]
The judgment considers the issue of what rules apply when a court is considering whether fixed costs apply. The judge preferring the view that the “new” rules apply and fixed costs should be paid. (Otherwise, ironically, there was an argument that the claimant should recover no costs at all).
THE CASE
The claimant was injured at work. He submitted a claim on the Employers’ Liability Protocol. The action fell out of the Protocol because the defendant did not admit liability. The action settled for £29,000.
THE ISSUE AS TO COSTS: THE DECISION OF THE DISTRICT JUDGE
The parties could not agree whether the claimant was entitled to fixed costs or costs to be assessed. Part 8 proceedings were issued in relation to costs. The District Judge held that because the figure exceeded £25,000 the Protocol ceased to apply and there should be an assessment of costs. The defendant appealed.
THE JUDGMENT ON APPEAL
There had been a change of rules between the “old” rules, which meant the claimant was entitled to an assessment of costs and the “new” rules which meant the claimant was entitled to fixed costs. The defendant contended the court should apply the rules on the date which the decision was made.
WHICH RULES APPLIED
HHJ Sephton QC held that the new rules applied and the claimant was entitled to fixed costs. The new rules had been introduced for clarification, and to prevent an argument that a claimant who settled for more than £25,000 was not entitled to any costs at all. There was no hardship in finding that the District Judge should applied the new rules.
“30. The first question I have to ask myself is what was the appropriate set of Rules that
District Judge Richmond ought to have had in mind when making the decision that he
did. He was sitting in a court at a time at which the new Rules, if I can use that
nickname for them, were in force. It seems to me that following the authorities, to
which my attention has been directed, I have to consider whether there is some
significant unfairness to the parties in reaching the conclusion that the new Rules
should apply. That is the litmus proposed by the House of Lords in L’Office Cherifien
case. These Rules clearly are procedural Rules, I accept, as I must, the decision of
Yew Bon Tew to the effect that merely because they are procedural Rules that does not
mean to say that they do not have retrospective effect.
31. What, it seems to me, those Rules were intended to be and indeed were, was a
clarification. The original Rule had been conceived under the illusion, to use Briggs’
LJ words, that the limit was £25,000 and the effect of the new Rule was to abolish
that illusion and to make clear that Claimants who had brought a claim under the
Protocol, which was subsequently settled for more than £25,000, were not deprived of
any costs at all as the strict reading of table 6C, together with 45.29D, would imply.
32. In other words, it seems to me that the purpose of the revision to the Rules was not to
impose unfairness upon Claimants but to make it clear, first of all, to all concerned
what the consequences were likely to be if a claim was started under the Protocol but
which ended up being worth more than £25,000. Secondly, to avoid injustice to
Claimants whose claims were settled for more than £25,000 and who would
otherwise, on a strict reading of Part 45.29D and Part 45.29E and the table annexed
thereto, be entitled to no costs at all.
33. Accordingly, there being no unfairness, in my judgment, to the Claimant in adopting
the new Rules, it seems to me that the new Rule should apply. It follows, in my
judgment that District Judge Richmond was wrong in applying, or purporting to apply
the old Rules. Had he done so properly, in my judgment, the Order that ought to have
been made is zero because that is the strict interpretation of 45.29D and table 6C.
Had I been approaching this matter afresh, I might have been tempted to read into
table 6C an omission of the words “but not more than £25,000” but it seems to me
District Judge Richmond was right when he said at paragraph 8 of his judgment that
he simply could not ignore those words.
34. The conclusion I reach, therefore, is that the District Judge ought to have been
applying the new Rules, that the fixed costs regime applies to this case and that,
therefore, the appeal is allowed.”
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