PRACTICE NOTE FROM SENIOR COSTS JUDGE: DEDUCTIONS FROM DAMAGES: CHILDREN AND PROTECTED PARTIES

The Senior Costs Judge has issued a Note on the procedure to be followed in the Senior Courts Costs office on approval of costs settlements where the claimant is a child or protected party.

 

 

THE NOTE

 

APPROVAL OF COSTS SETTLEMENTS, ASSESSMENTS UNDER CPR 46.4(2) AND DEDUCTIONS FROM DAMAGES

 

CHILDREN AND PROTECTED PARTIES

 

PRACTICE NOTE BY THE SENIOR COSTS JUDGE

  1. This note sets out the procedure to be followed in the Senior Courts Costs Office where the court has awarded costs to a child or a protected party and the parties have subsequently reached agreement as to the amount to be paid by the paying party (normally, the Defendant).
  1. CPR 21.10 provides that, where a claim is made on behalf of a child or protected party, no settlement, compromise or payment in respect of that claim shall be valid without the approval of the court.
  1. CPR 46.4(2)(a) provides that where money is ordered or agreed to be paid to, or for the benefit of, a child or protected party, the court must order a detailed assessment of the costs payable by, or out of money belonging to, the child or protected party (in other words, the costs and disbursements payable to the child or protected party’s legal representatives). The amount payable to the legal representatives by the child or protected party will, by virtue of CPR 46.4(4), be limited to that amount.
  1. CPR 46.4(2)(b) provides that on assessing those costs the court must also assess the costs payable by the paying party (unless a Default Costs Certificate has been issued or fixed costs apply).
  1. CPR 46.4(5) provides that where the costs payable by the child or protected party comprise only a CFA success fee or the balance payable under a DBA, the court may direct a summary assessment. (Such costs, if incurred in respect of a child in a claim for damages for personal injury, should be assessed summarily only where the damages do not exceed £25,000: CPR 21.12(1A).)
  1. CPR 46.4(3) and Practice Direction 46 at paragraph 2.1 create a number of further exceptions to CPR 46.4(2), notably where the child or protected party’s legal representatives have waived any claim to costs or disbursements not recovered from the paying party or where there is no need to order detailed assessment to protect the interests of the child or protected party or their estate.
  1. CPR 21.12 makes parallel provision for a litigation friend, on application, to recover costs and expenses incurred on behalf of the child or protected party. Such costs and expenses must have been reasonably incurred and be reasonable in amount and will in any event be limited to the amount recovered by reference to CPR 46.4.
  1. Ordinarily the Court approving settlement of the claim (or awarding damages) will have incorporated in its costs order either provision for the detailed assessment of any costs claimed by the child or protected party’s representatives, or will have dispensed with detailed assessment on one or more of the grounds provided for at Practice Direction 46, paragraph 2.1.
  1. If the costs order does not dispense with detailed assessment as between the child or protected party and their legal representatives, then it may provide for detailed assessment subsequently to be dispensed with if the criteria set by Practice Direction 46 at paragraph 2.1 are met.
  1. Where the court has ordered detailed assessment, the costs payable by the paying party have subsequently been agreed and the child or protected party’s legal representatives have waived any further claim to costs, the costs settlement with the paying party can be approved under CPR 21.10. Application to the SCCO for approval should be made under CPR 23. Appendix 1 to this practice note is a model form of approval order based on waiver.
  1. Where the criteria set by Practice Direction 46 at paragraph 2.1 are not met but the child or protected party’s representatives seek payment only of a CFA success fee or the balance payable under a DBA (and summary assessment is not precluded by CPR 21.12(1A)), application to the SCCO may be made under CPR 23 for a summary assessment under CPR 46.4(5). Appendix 2 to this practice note is a model form of summary assessment order.
  1. Applications for orders that the court “approves” or “certifies” the payment of costs by a child or protected party to their legal representatives are unlikely to be appropriate. If the legal representatives wish to dispense with detailed assessment on one or more of the grounds set out in paragraph 2.1 of Practice Direction 47 (other than waiver of any further claim to costs) they should make an application specifying the grounds relied on. The application must be supported by evidence.
  1. Otherwise a request for a detailed assessment hearing must be filed in form N258 and a hearing fee paid by reference to Schedule 1, paragraph 5.2 of the Civil Proceedings Fees Order 2008.
  1. It will not normally be necessary for the paying party to attend the detailed assessment hearing, because the receiving party’s costs will usually be assessed at the agreed amount. The court’s concern will be to assess the additional costs and disbursements claimed against the child or protected party.
  1. Accordingly, on filing form N258, the legal representative should notify the court that costs have been agreed with the paying party and that the purpose of the hearing will be to assess the costs and/or disbursements sought by the child or protected party’s legal representatives, and should provide a time estimate suitable for such a hearing. Appendix 3 to this practice note is a model form of directions for the hearing.
  1. The assessing judge is likely to take as a starting point that the hearing has been arranged for the benefit of the legal representatives and that it is not incumbent upon the child or protected party to bear the attendant costs.
  1. For that reason, unless the child or protected party’s litigation friend or Court of Protection deputy takes issue with the costs sought by the legal representatives and participates in the detailed assessment of those costs, the court is likely to make no order as to the costs of the detailed assessment process beyond any figure agreed with the paying party.
  1. Appendix 4 to this practice note is a model form of order following detailed assessment and authorising a further payment to the child or protected party’s legal representatives.
Andrew Gordon-Saker
Senior Costs Judge
December 2021