CLAIMANT WHO FAILED TO USE THE PORTAL WAS UNREASONABLE AND HAS TO FACE THE MUSIC: FIXED COSTS APPLY

I am grateful to Gemma Blackburn from DWF Law for bringing my attention to the judgment of Costs Judge Haworth in Harford v Music Store Professional UK/DV247 Ltd [2021] EWHC B17 (Costs).

 

“I am satisfied that in this case the Protocol should have been used and its non-use was unreasonable.  As regards CPR 44.11 and at 45.24(2)(b)(ii), I am satisfied that these provisions provide ample scope for discretion on my part to only allow the fixed costs to set out at Protocol.”

THE CASE

The claimant brought an action for damages for personal injury following an accident. He suffered a hernia. A letter of claim was sent stating that the matter was not suitable for the portal. Proceedings were issued and the action settled for £11,200 in total.

 

THE ISSUE

The judge was asked to determine whether it was unreasonable for the claimant not to use the Portal.

THE ARGUMENTS FOR BOTH SIDES

The judge set out the arguments for both sides.

Submissions
Claimant
  1. For the Claimant it was submitted that the decision not to use the Portal was a reasonable decision because the claim was felt to be worth above the portal upper limit.  That decision was objectively reasonable.  It was also submitted that the valuation of a claim is more of an art than a science and is a prediction of what a Court is likely to award and no more.  Ms Robson submitted that the Defendant must show that the Claimant’s assessment of the likely value of the claim was so unreasonable that the Court should drastically limit their costs entitlement to Portal costs.
  2. Further, CPR 45.24(2) was engaged only “where a judgment is given” [my emphasis].  In this case the claim settled with no judgment having been entered, and accordingly CPR 45.24(2) was not applicable.
Defendant
  1. For the Defendant it was submitted that fixed costs apply by virtue of one of two alternative routes.  First, in accordance with CPR 45.24(2)(b)(ii) by valuing the Claim more than £25,000 so that the Claimant need not comply with the relevant Protocol.  In that situation, the Court may order that the Defendant pay no more than fixed costs in Rule 45.18, together with the disbursements allowed in accordance with Rule 45.19.
  2. Dealing with the submission that judgment was needed to be given in favour of the Claimant, before Rule 45.24(2) is engaged, Mr Marven argued that the Claimant accepted a late Part 36 offer.  There had been no further settlement of the cost position, not least because of the parties’ disagreement as at the basis on which the Claimant’s costs should be determined.  Thus, pursuant to CPR 36.12(5) the Court can make an order for costs.  It was argued that any such order constituted a judgment for the purposes of Rule 45.24(2)(b)(ii).
  3. As an alternative, it was submitted that the analysis of the Court of Appeal in Williams v Secretary of State for Business [2018] EWCA Civ 852 4 WLR 147 lead to the same conclusion.  The Appeal Court held that at where the Protocol should have been used, and its non-use was unreasonable, the provisions of CPR 44.4 requiring a Judge to assess costs having regard to the conduct of the parties, provided ample scope for the Judge assessing costs to allow only the fixed costs set out in the Protocol.

THE JUDGE’S FINDING IN FAVOUR OF THE DEFENDANT

The judge found in favour of the defendant.   The claimant should have used the Protocol and the claimant’s costs were confined to fixed costs.

  1. At paragraph 56 of Williams, Lord Justice Coulson said this:
“56.  In my view it is at this point at paragraphs 2.1, 3.1 and a warning at 7.59 of the EL/PL Protocol become relevant.  Taken together, these paragraphs comprise a clear indication that if a claim should have been started under a protocol but was not, and it was unreasonable that the claim was not so started, then by the operation of the Part 44 conduct provisions, the Claimant should be limited to the fixed costs that would have been recoverable under the EL/PL Protocol.”
  1. I had the benefit of a statement from the Claimant’s solicitor, Stephen Francis Peter Green, dated 11 June 2020 which set out the instructions provided by the Claimant to him, his initial valuation of the claim, the further medical evidence obtained by him in 2017, his reasons for issuing proceedings, allocation to track and Counsel’s advice on quantum, which valued the claim at significantly less that £25,000.
  2. I am satisfied that on reviewing the facts of this case, bearing in mind an accident in 2015, a letter of claim on 26 May 2017, coupled with the fact that the second medical evidence does not appear to have been obtained until 15 January 2018, less than three months before the expiry of limitation, to proceed with the claim outside the EL/PL Protocol was unreasonable.  In my judgment, the reason for the issue of proceedings on 19 March 2018 was conditioned by the expiry of the limitation period without thought to the benefits of the Protocol and its undoubted relevance in these proceedings.
  3. For those reasons, I am satisfied that in accordance with the provisions of CPR 44.11, I have the discretion to disallow all or part of the costs of this claim, and accordingly the fixed costs set out in CPR 45.18 Table 6A shall apply in the sum of £4,205.
  4. If I am wrong in relation to my interpretation of the facts of this case, I prefer the submissions of the Defendant to those of the Claimant.  I am satisfied that by virtue of the Claimant’s acceptance of the Part 36 offer, pursuant to CPR 36.13(5) in itself constitutes a “judgment” [my emphasis] for the purposes of 45.24(2)(ii) CPR which is thus engaged.
  5. In conclusion I am satisfied that in this case the Protocol should have been used and its non-use was unreasonable.  As regards CPR 44.11 and at 45.24(2)(b)(ii), I am satisfied that these provisions provide ample scope for discretion on my part to only allow the fixed costs to set out at Protocol.