PART 36 AND THE ASSESSMENT OF COSTS: CLAIMANT ALLOWED TO RAISE THE ISSUE LATE, BUT TO NO GREAT AVAIL
In Best v Luton & Dunstable Hospital NHS Foundation Trust  EWHC B2 (Costs) Costs Judge Leonard allowed a claimant to raise an argument as to Part 36 benefits following an offer in assessment proceedings. However it was held that the claimant was not entitled to any Part 36 advantages.
“… my conclusion is that the costs of the detailed assessment proceedings do not, for the purposes of CPR 36.17(4), fall within “any issue that arises in the claim”. The Claimant’s submission that it does seems to me to be inconsistent with the way in which CPR 36 has been interpreted since well before 2013. It is also, in my view, inconsistent with the full provisions of CPR 36.17. To accept it would be to override my obligation to interpret the Civil procedure rules in accordance with the overriding objective.”
The claimant’s costs in a clinical negligence action were compromised when the defendant accepted a Part 36 offer out of time. The only matter outstanding was the costs of the assessment process itself. An assessment took place and the figure reached was £51,119.80.
Shortly after the hearing the claimant’s counsel stated that they wished to raise another issue in relation to claiming the benefits of a Part 36 offer. The hearing was taking place remotely and had finished early. However the defendant’s representative could not be contacted. After contact was made it was agreed that this issue should be raised in written submissions.
SHOULD THE CLAIMANT BE ALLOWED TO RAISE THIS ISSUE AFTER THE HEARING ?
It was held that the claimant should be able to argue the Part 36 benefit point despite the hearing having ended.
5. Some of the Defendant’s submissions query why the part 36 issue was not raised during the hearing, rather than after its conclusion. In fact Ms McDonald did explain in the reconvened hearing that she had omitted to address the point. With hindsight I realise that the fact that this was a simple oversight may not have been as clear to Mr Stott as it was to me, because he had not been present when Ms McDonald initially explained to me why she was requesting that we reconvene, but that was the essence of what she was saying.
6. Mr Clegg for the Defendant suggests that the Claimant should have filed a formal application to raise a new issue after the conclusion of the hearing. He refers to Re L and B (Children)  UKSC 8, in which the Supreme Court considered the appropriate exercise of a judge’s power to change a decision at any time before the relevant order is perfected, and Vringo Infrastructure Inc v ZTE (UK) Ltd  EWHC 214 (Pat), in which Mr Justice Birss (applying the principles of Re L and B and Ladd v Marshall  1 WLR 1489,  3 All ER 745 , CA) refused a defendant’s application, after judgment had been given but before an order was sealed, to amend its pleading, rely on new evidence and reopen the trial.
7. Mr Clegg argues that the principles applied by Birrs J, as is evident from his judgment, apply equally to the introduction of a new argument. The Part 36 argument could have been raised, with reasonable diligence, during the hearing. It is also disproportionate to raise the issue post-hearing, given that the value of the new argument in financial terms is (assuming that the Claimant seeks only a 10% uplift on the costs awarded, pursuant to CPR 36.17(4))) around £5,800. The consequence of this is he says that the Defendant did not achieve the final resolution of the case which it had a right to anticipate, but had to put up with the delay and additional cost necessarily attendant on written submissions and a written decision.
8. For the Claimant Ms McDonald relies upon the “slip rule” at CPR 40.12. She argues that the omission to raise the Part 36 offer was quickly identified and the matter brought back to a hearing within the original allocated time. It is not uncommon for parties to leave the courtroom, notice an error or omission, and go back to the court for the error or omission to be rectified. There is no real prejudice to the Defendant, in drawing the court’s attention to the fact that the Claimant had beaten her own Part 36 offer.
9. The first point to make is that I do not believe that I am being asked to change my mind about a decision I have already made. The summary assessment of the Claimant’s costs is undisturbed at £58,119.80. In the reconvened hearing I was asked only to address the consequences of that assessment in the light of the Claimant’s Part 36 offer, a point that had not previously been put to me.
10. Given that Ms McDonald was able to raise her point within the time originally allocated for the hearing, I think it is fair to approach the issue on the basis that she did in fact do so before the hearing ended. In other words, the hearing had not quite ended when we thought it had, because not all the issues had been addressed. As Ms McDonald says, the situation is really not very different to the parties, having left for a short period, re-entering the courtroom within the time allocated for the hearing to pick up a point that had been overlooked.
11. If I am wrong about that, however, I am sure that the Claimant should be able to raise the Part 36 point, for these reasons.
12. On the basis that the hearing had ended, I am not sure that either Re L and B (Children) or Vringo Infrastructure are entirely on point. Like Birrs J in Vringo Infrastructure, I am asked to consider something new, but the Claimant is not in this case seeking to amend her case or introduce new evidence. She is simply asking me to entertain a point that she should have raised, but omitted to raise, before the hearing was over.
13. For that reason, I do not think that the principles set out in Ladd v Marshall, which have to do with the admission of new evidence on appeal, have any real bearing. I am however assisted, as was Birrs J, by the principles identified by the Supreme Court in Re L and B (Children). In essence I must apply the overriding objective to deal with the case justly, considering relevant factors such as whether any party had, in consequence of the Claimant’s omission, acted to that party’s detriment or otherwise been prejudiced.
14. It seems to me that the simple answer to that is “no”. As Ms McDonald says, the oversight was spotted promptly and the hearing was reconvened within its original time slot. The reason that the point went to written submissions, rather than been dealt with on the spot, was that I thought that in order to present their case properly both parties needed an opportunity to understand and respond to the logic of my unreported decision in Bourne, and time did not allow for that. That would have happened even if Ms McDonald had raised the point immediately following the summary assessment.
15. In fact the only material difference caused by the Claimant’s omission is that the Defendant has been given an opportunity to argue, albeit unsuccessfully, that the Claimant should not now be able to raise the point. There is no prejudice to the Defendant in that. It seems to me that in all the circumstances, the application of the overriding objective requires that the Claimant be allowed to raise the matter of her Part 36 offer.
16. As a footnote I would add that I do not think, strictly speaking, that CPR 40.12 has any application, because that rule is designed to correct errors in orders and judgements that have already been perfected. I did however find it instructive, on reviewing the notes in CPR 40.12 in the White Book, to follow their reference to the observations of Rix LJ and Lewison LJ in Tibbles v SIG plc  EWCA Civ 518, on the subject of the court’s power to change a perfected order, whether under CPR 40.12 or CPR 3.1(7), to remedy an accidental omission of counsel or solicitor to ask for something which ought to have been provided for.
17. Evidently both R LJ and Lewison LJ thought that it could be appropriate to do so provided that an application to do so was made promptly, for example by the following day. If that is right where a hearing has concluded and an order has been perfected, it must be right where a hearing has concluded but the order has not been perfected.
THE CLAIMANT WAS NOT ENTITLED TO PART 36 BENEFITS
Having given the claimant permission to raise the point the Costs Judge was against the claimant’s construction of the rules.