Bratek -v-Clark-Drain Limited (County Court at Cambridge 30th April 2018)

John Hodgkinson – Advocate

IT’S A FIX!

A cry that perhaps goes out when the results of a popular game show do not go the populist way. The expected winner finds themselves cast aside in favour of someone unexpected. Their many fans express outrage, swamping social media with their views.

 

This may have been the cry of the Claimant’s team in Bratek -v-Clark-Drain Limited (County Court at Cambridge 30th April 2018).

They may be forgiven for thinking that they were unfairly classed as the losers, when noting the words of His Honour Judge Yelton:

  1. It does seem to me that a number of the cases which have come before the Court of Appeal are cases in which the claimant has tried to take bad points and to get round the provisions of the fixed costs. This is not the case here because the claim was properly started, the protocol was followed and the claim exited the protocol, if that is the right way of putting it, because there was going to be a trial. There are no grounds at all for criticising the claimant or its solicitors for their conduct of the litigation and it is wrong to say that that is the way in which the defendants should have put the case.
  2. It seems to me that if one goes back to what was said in the Sharp case as an expression of principle rather than part of the judgment the courts should uphold the restriction on costs set out in part 45 of the CPR save in exceptional circumstances.’

So, being ahead of the game, and doing things properly, they were still found not to have a valid argument.

The case was an appeal from District Judge Matthews, who had previously decided in favour of the Claimant. Hence, they were apparently already ahead as favourites to win.

Ironically, the appeal was not against a decision in the principal action, but the District Judge’s interpretation of a consent Order, that settled the case. Being by consent might have suggested the parties knew the effect of what they were signing up to, but apparently there was no meeting of minds on the precise impact on costs.

The parties had settled a personal injury case by a consent order for payment by the Defendant to the Claimant of £10,000 in damages, and further providing that “the defendant pay the claimant’s solicitor’s costs of the action, inclusive of VAT and disbursements on a standard basis, to be assessed if not agreed”.

The Claimant’s position was that this order gave them entitlement to have their assessed costs, and superseded  the fixed costs set out in CPR 45.29 A-J.

The difference in figures was not insignificant. If the Claimant was correct, costs amounted to around £24,000. If the fixed costs regime applied, the total would be limited to £10,000.

It was indeed a fix, but only because fixed costs applied, and the application of these could not be contracted away.

Exceptional circumstances would have been required under 45.29 J, for the Court to consider a claim greater than fixed costs. Whether or not such could have applied in this case, this was not addressed.

It is important to be aware of the impact of fixed costs, even when properly leaving the portal, and consider whether exceptional circumstances exist, if the matter has not been capable of allocation to the multitrack.

There is typically limited guidance on what may be classed as exceptional. Perhaps this is not surprising, given the meaning of the word. It is likely to be applied strictly.

If exceptional circumstances exist and the Court can be persuaded of this, it would seem only then that we can avoid crying out, It’s a fix!

Postscript

The fixed cost regime is still haunted by the spectre of the ‘Quadar anomaly’

Those die-hard practitioners who have lived with, or sought to escape from, the fixed costs regime, will recall the case of Qader & Ors v Esure Services Ltd & Ors [2016] EWCA Civ 1109 (16 November 2016).

Partners in Costs have previously highlighted the apparent anomaly, which perhaps was the spectre at the feast of celebrations following the Qader decision.

As was discussed by our Lee Dixon in December 2016 (click here to view the full article):

‘Briggs LJ in his run through the rules essentially decided that reference to a £25,000 cap in Part A Table 6B was a mistake and if the case was “properly started” in the Portal and exits, then unless it is allocated to the Multi track then you get fixed costs even if the value was more than £25,000 courtesy of 45.29B.

He did fixate on the “anomaly” of this cap for cases which conclude pre-issue for more than £25k as the table does not provide any fixed costs beyond that, but he declined to deal with the point after having raised it the first place.

So, following this through if you think your case is worth £10k, and then it turns out it is worth £500k so it comes out of the portal, then it settles pre-allocation you’re still only getting fixed costs.

Once upon a time we all knew that there was clearly and unequivocally a £25,000.00 cap.  Briggs LJ said that, “to require the parties to guess…would introduce a damaging and unnecessary degree of uncertainty into a scheme which depends upon its predictability”; the Judgment of Qader, obiter or not, has, in fact, created precisely that uncertainty and unpredictability.

An anomaly that has still not been dispelled, and lingers to this day.

Avoiding the implications:

  1. Do not enter the portal if the claim is plainly above the financial limit
  2. Do not settle before allocation to the multitrack.
  3. Seek to persuade the Court that there are special reasons to disapply fixed costs

 

To contact John Hodgkinson with any queries relating to this article, or indeed with any costs related query or to arrange a training session at your firm click here.

 

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