FAILING TO SERVE THE CLAIM FORM IS NOT AN “ABUSE OF PROCESS” SO AS TO LEAD TO QOCS BEING DISAPPLIED: COURT OF APPEAL DECISION

We are returning to the decision of the Court of Appeal in Court of Appeal in Birley & Anor v Heritage Independent Living Ltd [2025] EWCA Civ 44. The Court upheld a finding that the failure to serve the claim form, or comply fully with the Pre-Action Protocol, was not an abuse of process.  Consequently QOCS was not disapplied.  There are also important observations about the need for defendants, applying to strike an action out and for QOCS to be disapplied, to give clear notice  of what they are seeking.

“… in future when a defendant makes an application which might lead to a disapplication of QOCS, the defendant ought to give clear notice to that effect. Given that the original application did seek a strike out and referred expressly to CPR r3.4, HHJ Owen construed it as including an application to strike out for abuse of process. Therefore if that had succeeded it was likely to lead to a debate about QOCS, but that was never spelled out. If it had been, matters would have gone much more smoothly. In general applicants for orders with that potential should identify that aspect expressly if that is what they plan to contend for.”

THE CASE

The original claimant (Ms Taylor) brought an action against the defendant, “Heritage”. The action was for breach of the GDPR Regulations, the Data Protection Act, misuse of private information and breach of confidence.  A claim form was issued which included a claim for personal injury. Ms Taylor died prior for service and her solicitors applied for a stay of proceedings. On 14th December 2021 (after the date proceedings should have been served) the court granted a stay.  The order stated that an amended claim form and particulars of claim should be served by 17th March 2022.  These documents were served in Deceber 2021. The defendant acknowledged service and then applied to set aside service and for the claim to be struck out “for late service pursuant to CPR r.3.4”

THE STRIKING OUT OF THE ACTION

The District Judge found that the claim form had not been served in time. She also found that continuing the action amounted to an abuse of process and disapplied QOCS.

1. 1. The application came to be heard before District Judge Nicolle on 25 January 2023. The judge accepted Heritage’s submission that the claimants had failed to apply in time for an extension of time to serve the claim form. She rejected the claimants’ case that the application which had been made, for a stay, could be understood as or treated as including an application for an extension of that kind. District Judge Nicolle decided to set aside service of the claim form and declared that the court did not have jurisdiction to hear the claim on the ground of late service of the claim form. She also ordered the claim to be struck out.

1. When dealing with costs the judge held that continuing with the claim when the claim form had been served out of time amounted to an abuse of process and therefore the case fell within the exception to QOCS provided for in CPR r 44.15(b). The order directed that the claimants pay Heritage’s costs of the application and the action, and disapplied QOCS.

THE CLAIMANTS’ SUCCESSFUL APPEAL TO THE CIRCUIT JUDGE

1. 1. The claimants appealed and permission was given on three grounds (numbered grounds 2, 3 and 4). Ground 2 was that once the claim form had not been served in time, there was nothing to strike out. Ground 3 was that the court having done what it did had no power to award costs of the action. Ground 4 was that the court had been wrong to find that r44.15 applied, essentially because there was no abuse of process. The significance of these grounds is their impact on costs.

1. 1. HHJ Owen heard the appeal. He dismissed ground 2 on the basis that while it was not necessary to strike out a claim in these circumstances, if the conditions for making such an order were made out (CPR r3.4) then in principle there was no reason why such an order could not be made. HHJ Owen dismissed ground 3 on the basis that s51 of the Senior Courts Act 1981 and CPR r44.2 gives the court a wide power in relation to costs, which includes power to make an order about the costs of the action in a case like this one.

1. However the claimants’ appeal on ground 4 succeeded. What would be required to justify a strike out in these circumstances was inordinate or inexcusable delay, or intentional or contumelious default, or wholesale disregard for the rules in failing to serve the claim form in time, whereas all that had been identified in this case was, at most, a failure to serve the claim form in time. There was no evidence it was deliberately or wilfully late (judgment [71]). That does not amount to an abuse of process, applying Aktas v Adeptas [2010] EWCA Civ 1170 (at [90]).

THE DEFENDANT’S UNSUCCESSFUL APPEAL TO THE COURT OF APPEAL

1. 1. The context for this topic is the QOCS scheme. That scheme was introduced when the recovery of CFA success fees and ATE insurance premiums was prohibited in personal injury claims (this is addressed in more detail below). The point of QOCS was to promote access to justice by mitigating the claimants’ litigation cost risk in those cases. The scheme is in section II of CPR Part 44, rules 44.13 to 44.17.

1. 1. By r44.13 the scheme applies to proceedings which include a claim for damages for personal injuries. It also applies to claims for damages under the Fatal Accidents Act 1976 and to claims for damages which arise out of death or personal injury and survive for the benefit of the estate under s1(1) of the Law Reform (Miscellaneous Provisions) Act 1934.

1. 1. By r44.14, subject to certain exceptions, a limit is placed on the ability to enforce a costs order against a claimant without the permission of the court. The limit, for cases like this one issued prior to April 2023, would be the total of any damages and interest obtained whether by order or settlement, in the proceedings. So for example, if that claimant lost the claim entirely, received nothing from the defendant, and the court made the usual order requiring the claimant to pay the defendant’s costs of those failed proceedings, then the effect of QOCS would be that the costs order could not be enforced without permission at all because the total damages and interest recovered was nil. This shows how QOCS protects a claimant from a costs risk, provided the claimant avoids the exceptions.

1. 1. One of the exceptions is in CPR r44.15, which provides as follows:

44.15 Orders for costs made against the claimant may be enforced to the full extent of such orders without the permission of the court where the proceedings have been struck out on the grounds that –

(a) the claimant has disclosed no reasonable grounds for bringing the proceedings;

(b) the proceedings are an abuse of the court’s process; or

(c) the conduct of – (i) the claimant; or (ii) a person acting on the claimant’s behalf and with the claimant’s knowledge of such conduct, is likely to obstruct the just disposal of the proceedings.

1. 1. This exception has two elements. The proceedings must have been struck out, and the reason for the strike out must be one of the reasons in (a) to (c). The relevant limb in this case is sub-paragraph (b) – abuse of process.

1. 1. Finally, it is worth mentioning the exception for so called mixed claims provided for in r44.16(2)(b). Essentially if, in addition to the claim to which QOCS applies by r44.13, the claimant also brings another claim which is not one to which QOCS applies, then the court has a discretion as to the extent to which a costs order may be enforced with permission (see Brown v Commissioner of Police of the Metropolis [2019] EWCA Civ 1724). As mentioned above already, HHJ Owen treated this action as a claim for personal injury and not a mixed claim, so that r44.16(2)(b) did not apply. There is no appeal from that decision.

1. 1. I turn to address briefly various subsidiary procedural points taken by both sides. First, HHJ Owen was right in my judgment that the District Judge was entitled to consider the question whether the criteria for striking out for an abuse of process were met, even though she had also decided to set aside service. The reason is because of the significance attached to striking out for abuse of process in the context of QOCS.

1. Nevertheless while Heritage’s position on QOCS in the circumstances was understandable, in future when a defendant makes an application which might lead to a disapplication of QOCS, the defendant ought to give clear notice to that effect. Given that the original application did seek a strike out and referred expressly to CPR r3.4, HHJ Owen construed it as including an application to strike out for abuse of process. Therefore if that had succeeded it was likely to lead to a debate about QOCS, but that was never spelled out. If it had been, matters would have gone much more smoothly. In general applicants for orders with that potential should identify that aspect expressly if that is what they plan to contend for.

CONDUCT

The defendant had raised issues about the claimants’ conduct of the action. There had been a failure to comply with the pre-action protocols.

1. 1. Second, while HHJ Owen was not bound to consider the claimants’ conduct in general as a separate basis for abuse of process, it was within his discretion to do so and he gave cogent reasons for it. The judge noted, at [78], that the appellants before him (i.e. the claimants) knew that there was criticism of the pre-action conduct and that both parties had led evidence on the topic. He did not believe further new evidence would be needed to address the points being raised and found that the claimants would not be put to an unfair disadvantage.

1. 1. The third procedural point is this. On appeal to this court Heritage’s oral submissions included further points which were described as more examples of “flouting” the pre-action protocol by the claimants. I am not satisfied it would be right to entertain the submissions on this, a second appeal. The caution identified in Singh v Dass [2019] EWCA Civ 360 concerning the raising of a new point on appeal applies even more so on a second appeal. Adherence to pre-action protocols is of real importance but these points were not explored in the proceedings below, were not developed in the evidence. Nor were they dealt with by HHJ Owen in his judgment. The conduct issues addressed by HHJ Owen are the ones on which this appeal will be decided and I turn to address those.

1. 1. The principles relevant to abuse of process and strike out are not in dispute. While the decision to strike out is a matter for the court’s discretion, whether something is an abuse of process is different, in that, although it involves an evaluation of a large number of factors, it is a judgment which is either right or wrong, (Aldi Stores v WSP Group [2008] 1 WLR 748 followed by Rix LJ in Adeptas at [53]). The principles to be applied in deciding whether something is an abuse of process were summarised in Cable v Liverpool Victoria [2020] EWCA Civ 1015. The whole passage from [42] to [48] is relevant, starting at [42] with the well-known statement by Lord Diplock in Hunter v Chief Constable of West Midlands Police [1982] AC 529. There is nothing to be gained from attempting to restate those principles. The two aspects I would highlight are these. The first is the court’s real reluctance to strike out a claim save as a last resort (see [45] and [47]). The second is that abuse of process can apply to pre-action conduct (at [55] to [58]). The issue in Cable being compliance with the “RTA Protocol” (the Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents).

1. 1. Adherence to pre-action protocols, even the most general protocol, is of real importance in civil justice. However in this case there has been an unproductive debate about which pre-action protocol was applicable and therefore which one had not been complied with. It is unproductive, because if the pre-action conduct criticised in this case did amount to an abuse of process, then that would be true whichever pre-action protocol one had in mind. Conversely, if it was not abusive, measuring what happened against one of the other protocols does not make it abuse.

1. 1. The three candidates are the MAC Protocol, the PI Protocol (the Pre-Action Protocol for Personal Injury Claims) and the general Pre-Action Protocol.

1. 1. HHJ Owen was referred to the MAC Protocol, and that is reflected in the judgment at [84] and [85]. However, it has been pointed out that this pre-action protocol only came into effect on 1 October 2019, after the correspondence started. That is true but it does not help. It does not mean that no pre-action protocol at all applied and certainly does not mean that the pre-action correspondence would somehow be immune from criticism. Apart from anything else, once the MAC Protocol came into force on 1 October 2019, then an obvious thing for sensible litigators to do when bringing claims such as the ones in this case, which manifestly fell within its ambit, would be to follow it from then on with suitable adaptations.

1. 1. The second candidate pre-action protocol is the PI Protocol. That has been in force in one form or another since 1999. It was suggested that this might not apply here given the media-based causes of action and the fact that that protocol is aimed at claims likely to be allocated to the Fast Track. Neither of these is a good point either. Taking the second point first, the PI Protocol expressly notes at paragraph 1.1.2 that the spirit, if not the letter, of the protocol should still be followed for claims which could potentially be allocated to the multi-track (or since 2023 the intermediate track). The fact that most claims handled under the PI Protocol are brought in negligence does not prevent sensible litigators from following it, again with suitable adaptations if necessary.

1. 1. Finally and in any event, the general Pre-Action Protocol would always be relevant if no other pre-action protocol was thought to be suitable. It sets out a general procedure to take place pre-action which involves (at [6(a)]) the claimants providing concise details of the claim to the defendant before issue.

1. 1. Turning to the alleged abuses, on the main conduct arguments as they were before HHJ Owen, such as the anonymisation of the pre-action letters, I cannot fault his decision. The letters certainly should have identified the claimant and they were unreasonable in not doing so, but I agree with the judge that this error does not amount to an abuse of process. Nor, even if it did, would this justify striking out the proceedings. Neither, again as the judge recognised, would the failure to serve the claim form on time. Aktas v Adeptas (at [90]) shows that a negligent failure of that kind is not, without more, an abuse of process. The same is true considering these two failures in combination, coupled with the other errors (a mistake on dates and failures to notify the other party of steps being taken). The claimants’ solicitors’ conduct was lax but did not step over into an abuse of the process, let alone as conduct justifying the remedy of striking out.

1. 1. That leaves the matter of cherry picking between the recovery of success fees and QOCS. The QOCS scheme has been described already but it is now necessary to address what is and is not recoverable in costs in the context of privacy and other media claims.

1. 1. In 1990 s58 of the Courts and Legal Services Act 1990 (CLSA) introduced the idea of enforceable CFAs. However, in 2012 following recommendations in the Jackson Report, the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO) at s44 made amendments to the CLSA which, broadly, prevented the recovery of success fees payable under a CFA or recovery of ATE insurance premiums. The operative parts of the CLSA as amended were s58A(6) on success fees and s58C(1) on ATE insurance premiums. These changes applied to most types of civil claims, including claims for personal injury, and it was at this time that the QOCS system was introduced.

1. 1. The terms of these sections are as follows:

S58A(6) A costs order made in proceedings may not include provision requiring the payment by one party of all or part of a success fee payable by another party under a conditional fee agreement.

S58C (1) A costs order made in favour of a party to proceedings who has taken out a costs insurance policy may not include provision requiring the payment of an amount in respect of all or part of the premium of the policy, unless such provision is permitted by regulations under subsection (2)

1. 1. When these bans came into force “publication and privacy proceedings” were excluded. The term “publication and privacy proceedings” was defined in article 1 of the 2013 LASPO Commencement Order No 5 (SI/2013/77) to include proceedings for breach of confidence involving publication to the general public, and misuse of private information. The operative part of the statutory instrument provides that the provision in it which brings s44 of LASPO into effect, which in turn amends s58 of the CLSA, does not apply to those kinds of proceedings.

1. 1. However, by a later statutory instrument, the 2018 LASPO Commencement No. 13 (SI 2018/1287), the exception for success fees in publication and privacy proceedings was abolished, as from 6 April 2019. From that time on, the ban on recovering success fees applied to these claims. However there remains no ban on the recovery of ATE premiums in publication and privacy proceedings.

1. 1. Thus, when the correspondence started in January 2019, both a CFA success fee and ATE premium were potentially recoverable in costs in publication and privacy proceedings, although by April 2019 that position had changed as far as success fees were concerned. Given that the correspondence included a claim for misuse of private information, it is manifest that the court proceedings contemplated by the correspondence from the outset were, or at least included, publication and privacy proceedings.

1. 1. Turning to Heritage’s submission on “cherry picking”, the argument is that the purpose for which QOCS was introduced was as an alternative to the recovery of success fees and ATE premiums and therefore it cannot have been intended that both could apply in the same action. One way of putting it is to say that personal injury cases are not publication and privacy proceedings. I agree with Heritage’s premise in general terms, but the conclusion does not follow from it. The answer depends on the precise manner in which QOCS was introduced and in which recovery of success fees etc. was maintained. The way the legislator chose to implement the ban on the recovery of success fees was by prohibiting the relevant sort of costs order in certain kinds of proceedings. No such prohibition applied, prior to April 2019, in publication and privacy proceedings. However the rules bringing in the QOCS scheme provided that it applies to claims for damages for personal injury. Although most claims for these damages are made based on a cause of action in negligence, the rules do not approach the matter in that way.

1. 1. The claim identified in the pre-action correspondence and in the claim form was one for damages for personal injury (psychiatric damage) caused by the wrongful disclosure of private/confidential information. There is nothing inherently wrong with that. Claims of that kind are rare but not unknown (Warby LJ kindly referred me to paragraph 11.222 of The Law of Privacy and The Media, 4^th ed, which contemplates just such claims).

1. 1. It has never been alleged that the claim as framed in this case was fictitious or otherwise bogus. After all it was supported by an expert’s report. The pre-action correspondence did not conceal the basic nature of the claim, which was firmly within the ambit of CPR 53.1 concerning proceedings in the Media and Communications List. Therefore, once it was in force, the MAC Protocol was apt. Given that the causes of action included a claim for misuse of private information, prior to April 2019, a CFA success fee was recoverable; and at the same time the QOCS scheme applied, because personal injury damages were claimed. Whether and how the provision on mixed claims might or might not have effect if this case had gone to trial is not in issue.

1. 1. Therefore I would dismiss the appeal on this first topic.

1. 1. Before leaving the first topic it is worth noting that on this appeal it was not necessary to grapple with the recent ECHR judgment in Associated Newspapers v the United Kingdom (No. 37398/21), 24 November 2024 on the success fee regime in media cases. When I describe a success fee as recoverable prior to April 2019, I simply mean recoverable within the terms of the CLSA itself without reference to that judgment.

AVOIDING THE PITFALLS IN SERVICE OF THE CLAIM FORM: WEBINAR 4th FEBRUARY 2025

Every year this blog covers numerous  cases where claimants (and occasionally defendants)  come to grief in relation to service of the claim form. The frustrating issue in relation to service issues is that most (if not all) of the problems are avoidable with a little care and with the appropriate knowledge of the rules and case law. This webinar looks very closely at the rules relating to service of the claim form and particulars of claim with the primary aim of making sure that you do not fall foul of the rules and serve properly and in time.  It looks at many examples of where things have gone wrong and provides clear guidance as to how to avoid problems.  

Booking details are available here. 

MATTERS COVERED IN THE WEBINAR

The aim of the webinar is to make sure you are aware of problem areas and how best to avoid them. It looks very closely at the rules relating to service of the claim form and particulars of claim with the primary aim of making sure that you do not fall foul of the rules and serve properly and in time.  It looks at many examples of where things have gone wrong and provides clear guidance as to how to avoid problems.

• Why do things go wrong so often in relation to service of the claim form
• “The address for service” – problem areas
• When must you serve on a solicitor?
• Identifying problems with service and heading them off
• What can you do if things go wrong with service