COST BITES 139: A CLAIMANT WAS NOT AWARDED COSTS AGAINST HIS OWN SOLICITORS: WHAT HAPPENS WHEN YOU BURY YOUR HEAD IN THE SAND

The judgment of Deputy Master Grimshaw in  Al Tarboush v Cassam [2024] EWHC 639 (KB) shows two things: (i) the limitations of the wasted costs procedure; (ii) the major procedural problems that can arise in the course of a case when a party puts their “head in the sand” in relation to procedural issues.

“This case has a sorry procedural history and serves as a good example of why one should not ‘bury one’s head in the sand’ when problems in litigation arise.”

WHAT TO DO WHEN THINGS GO WRONG IN LITIGATION: 2024

On the 30th April 2024 I am presenting a webinar “What to do when things go wrong in litigation”.  Booking details are available here.

This webinar looks at:

  • The most common kinds of mistake in personal injury litigation. Limitation, breach of court orders, problematic witnesses and clients
  • What not to do
  • The practical steps you can take to put matters right
  • What do you do if the problem can’t be rectified
  • Learning from your mistakes

THE CASE

The claimant had brought an action for damages for personal injury. Liability was agreed.   The action was subsequently struck out due to procedural failings by the claimant’s solicitors. An order was made that the costs could be enforced directly against the claimant.  A notice to show cause was made against the claimant’s solicitors.

The defendant settled the wasted costs order against the claimant’s solicitors.  However there was a shortfall for which the claimant was liable.  The application for wasted costs continued with the claimant seeking wasted costs against his own solicitors.

THE PROCEDURAL HISTORY

 

    1. The Claim Form was issued on 4 February 2019, with proceedings being served on or around 27 May 2019.

 

    1. What followed was an extraordinary course of procedural failures on the part of the Claimant and/or Hegarty. I need not set these out in detail, but summarise the same as follows:

THE HISTORY IN DETAIL

i) The parties had agreed directions in 2019 (which included service of expert evidence in the fields of neuropsychiatry, neurosurgery, neuro-rehabilitation and care by 10 February 2020) but the Claimant failed to serve his expert evidence pursuant to those agreed directions and this resulted in the Defendant making an application for a case management conference (“CMC”) on 20 September 2020; this hearing was listed on 10 November 2020.

ii) The Claimant agreed directions in advance of the CMC listed on 10 November 2020 and these were put before Senior Master Fontaine as an agreed consent order, which was approved by Senior Master Fontaine, and the CMC was vacated. This order set the date for the Claimant to serve his medical expert evidence as 3 March 2021.

iii) The Claimant again failed to serve his expert evidence and the Defendant therefore made an application for an unless order. This resulted in Senior Master Fontaine making (on the papers) the unless order of 30 July 2021, sealed on 19 August 2021.

iv) The Claimant did not serve his expert evidence within the time allowed by Senior Master Fontaine’s unless order but instead made an application for relief from sanctions. This application was listed on 7 February 2022. The Claimant had still not served his medical expert evidence by this date. Senior Master Fontaine made a further directions order on 7 February 2022, which included a debarring order, and which also required Hegarty to show cause as to why a wasted costs order (“WCO”) should not be made. A further CMC was listed for 15 June 2022.

v) The directions of 7 February 2022 were complied with. When serving his evidence, the Defendant served surveillance and social media evidence (“SSME”), along with commentary and opinions arising from this evidence from his experts. To put it as neutrally as possible, the Defendant’s experts raised significant concerns about the apparent disparities between the Claimant’s reported symptoms and the SSME.

vi) The parties then agreed further directions ahead of the CMC, which were approved by Senior Master Fontaine, and the CMC on 15 June 2022 was vacated. The agreed order included Hegarty’s consent to the making of a WCO. The parties agreed directions concerning the service of factual and expert evidence and for expert joint meetings, with the joint statements due by 25 November 2022. A further hearing was then listed for 15 December 2022.

vii) The Claimant failed to serve any expert evidence in compliance with this agreed directions order, due to “oversight” on the part of the Claimant’s Solicitor.

viii) The hearing on 15 December 2022 was the first hearing before me. I allowed the Claimant one further opportunity to comply and ordered that the Claimant should file supplemental reports from his experts arising out of the SSME by 20 January 2023 and that he would be debarred from relying on any evidence which was not served in compliance with the order. I also made a further ‘show cause’ order, as well as making it clear at the hearing and by way of a recital to the order that the Court was concerned about the lack of compliance by the Claimant.

ix) There was a further failure to comply. The case came before me again on 2 February 2023. I gave further case management directions and dealt with the late service of some of the Claimant’s expert evidence and the Defendant’s objections to some of the other expert evidence served. I debarred the Claimant from relying on two expert disciplines because of his failure to comply with the previous order. A WCO was made in relation to the 15 December 2022 hearing, Hegarty having consented to the same. I made a further show cause order regarding the costs that I ordered against the Claimant arising out of the further failures associated with the service of the Claimant’s expert evidence.

x) As a result of the 2 February 2023 order, the Defendant considered it appropriate to pose Part 35 questions to one of the Claimant’s experts, Dr Bavikatte, about whether the SSME had been sent to him in order to prepare his report. Dr Bavikatte responded that he was not sent either the social media evidence or the Claimant’s witness statement. The Defendant therefore applied to vary my Order of 2 February 2023 to revoke permission for the Claimant to rely on Dr Bavikatte’s report on the basis that there had been a failure to comply with my previous directions. The Claimant consented to this application, and I approved that order on 21 April 2023 and set further case management directions to trial. That order recorded that Hegarty had consented to (and paid) a further sum of wasted costs arising from the 2 February 2023 order and had consented to a further WCO in relation to the Defendant’s application concerning Dr Bavikatte’s evidence. I made a WCO against Hegarty accordingly. A further hearing was listed for 6 October 2023 to hear the Defendant’s strike out application.

xi) The non-compliance continued in terms of the arrangements for expert joint meetings. In short, the Claimant did not co-operate with the arrangements for the meetings, nor were his experts instructed to attend.

xii) The Defendant therefore made an application on 3 August 2023 to strike out the Claimant’s claim and for an indemnity costs order against the Claimant, as well as a WCO against Hegarty.

  1. On 6 October 2023, I heard the Defendant’s application to strike out the Claimant’s claim as a result of the aforementioned procedural failings. I was invited to find that the Claimant’s conduct amounted to an abuse of process and thus that I ought to strike the claim out pursuant to CPR 3.4(2)(b) and 3.4(2)(c). Unfortunately, the Claimant was not represented at this hearing before me as, despite being on notice of the hearing, the Claimant’s solicitor, Mr Rowcliffe, emailed me directly late morning on the day of the hearing with a witness statement (dated 5 October 2023) that informed me that he would not be attending the hearing and seeking an unless order instead of striking out the claim; no adjournment was sought. I promptly responded to Mr Rowcliffe to inform him that the hearing would proceed and thus the Claimant should be represented. I received no further correspondence from Mr Rowcliffe that day, nor was representation arranged. For the reasons that I gave in my ex tempore judgment given on that day, I allowed the Defendant’s application and struck the Claimant’s claim out pursuant to CPR 3.4(2)(b) and (c).

 

THE KEY FINDING

The judge’s key finding was that the court does not have jurisdiction to make a wasted costs order in these circumstances.

 

    1. What the Claimant has incurred is a liability to pay the Defendant’s costs of the action rather than incurring costs himself. The Claimant’s new solicitor, Mr Hanif, sought an order that Hegarty should pay the Defendant’s costs[1]. The regime under s. 51 Senior Courts Act 1981 is not designed for this purpose.

 

    1. This does create a potential lacuna. Had the Defendant not settled its application for wasted costs against Hegarty, I would likely have been invited to conclude that Hegarty should have been ordered to pay the Defendant’s entire costs of the action given their conduct. Had I done so, the Claimant’s costs liability in terms of the Defendant would have effectively been extinguished. There must be doubt in this case, however, that I would have reached that conclusion. It seems to me that there is a good argument that the Defendant’s entire costs of the action were not ‘wasted’ costs per se, they were costs that had been incurred as part of defending the legitimate action, such action then having been struck out, and thus a costs order made in the Defendant’s favour. I reach this view because:

 

i) The Claimant had a liability judgment against the Defendant, subject to a modest reduction for contributory negligence.

ii) The Claimant clearly suffered some injury as a result of the accident. He was making a claim that he suffered a significant traumatic brain injury.

iii) The Defendant would have had to incur costs to defend what was presented as a very significant claim for damages.

    1. Returning to the issue before me now, to make a WCO in the Claimant’s favour, I must be persuaded that Hegarty’s conduct has caused the Claimant to incur unnecessary costs. I am not so persuaded that the Claimant has himself incurred unnecessary costs, let alone what those costs are. The Claimant’s application is therefore dismissed.

 

  1. Insofar as the Claimant (or his Litigation Friend) now has to pay the Defendant’s remaining costs of the litigation, his recourse is to bring a professional negligence claim against Hegarty.

 

OTHER FACTORS

    1. If my analysis above is incorrect, I then have to move on the consider whether a WCO is just in this case.

 

    1. Whilst I am critical of Hegarty’s conduct, I am not satisfied that a WCO would be just in this case even if stage two of the Ridehalgh test was met. I have reached this view for the following reasons.

 

    1. The issues between the Claimant and Hegarty are not suitable for summary disposal. The authorities set out above are clear that the wasted costs jurisdiction is a summary one and one where the court is dissuaded from entering into a prolonged inquiry as to various factual matters, least of all about the relationship between, and issues that have arisen between, a claimant and his solicitor.

 

    1. I agree with Hegarty’s position that matters are not so straightforward in this case that I can deal with the matter summarily where, for example, there are issues between the Claimant and Hegarty as to why procedural steps were missed and the impact of the surveillance evidence on the running of the claim.

 

    1. I reject the Claimant’s submission that the issue of potential dishonesty on the Claimant’s part is irrelevant to the matters before the Court on this application. It would create an unfairness should the Claimant escape all liability for costs if, for example, the evidence was compelling that he had been dishonest with his solicitor or indeed within the action as a whole.

 

    1. Should the Defendant pursue the Claimant for any of the remaining costs, the Claimant could bring a claim against Hegarty for professional negligence to recover, or seek an indemnity for, the same. That would be the more appropriate route to deal with the issues between the parties, rather than through the summary wasted costs procedure. Determination of such an action will likely require careful consideration of Hegarty’s file and evidence from the Claimant, his Litigation Friend and Hegarty/Mr Rowcliffe.

 

    1. If there is to be any apportionment of blame for the strike out, fairness dictates that there ought to be a proper inquiry, and that is not suitable for summary determination through the wasted costs process.

 

  1. For these reasons, even if the first two stages were met, I would dismiss the Claimant’s application.