Covid; an exceptional time but not an exceptional circumstance.
Osuzuwa-v-Madeira, District Judge Moan, Coventry County Court. Case number F27YY758. Any personal injury litigator dealing with fixed costs matters needs to be aware of this decision. The bar for exceeding fixed costs and the test of exceptional circumstances is a high one and this is reinforced by this decision. An adjournment and two aborted trials did not justify any departure from the fixed costs regime.
The Claimant brought a claim for personal injury against the Defendant. The claim was concluded by way of the Defendant’s acceptance on 13th January 2021 of the Claimant’s Part 36 offer which was made on 13th December 2019. However, there were two aborted trials, the first, on 26th October 2020, which did not take place as the Defendant’s partner had Covid and he was required to self-isolate. The trial was adjourned. The second trial was listed for 14th January 2021, but the Defendant accepted the Claimant’s Part 36 offer the day before the trial. Therefore, this trial was vacated.
The parties agreed that this was a matter which fell within the fixed costs regime set out in CPR 45IIIA. The applicable costs fell within Table 6B, and in this instance, amounted to £2,655.00 plus 20% of damages. The advocacy fee would not be payable as the case had settled before the day of the trial (Coleman-v-Townsend [2020], Master Haworth).
The Claimant sought to recover costs outside the normal scope of fixed costs, being the two Counsel’s fees for the two trials which did not take place, additional profit costs and interest. The Claimant sought the costs to be assessed pursuant to CPR 36.13. However, the Court refused to assess the costs under that provision, and instead, relying on Hislop-v-Perde [2018] EWCA Civ 1726, the Court found that the correct provision was CPR 36.20 for a fixed costs case where a Part 36 offer is accepted out of time.
Notwithstanding the preliminary determination of the correct provision of Part 36 under which the costs fell to be assessed, the Court accepted that there remained provision under CPR 45.29J to seek to recover costs in excess of those prescribed. In fact, the Court took the view that the only route to recovering Counsel’s Brief fee was via this provision (as opposed to CPR 45.29I (h)-any other disbursement reasonably incurred due to a particular feature of the dispute). The Court reviewed the findings in Ferri-v-Gill, which in turn considered Hislop-v-Perde. This reinforced the Court’s need to consider exceptional circumstances as a high bar. The Court further referred to the importance to the parties of the certainty provided by the fixed costs regime and the “swings and roundabouts” nature of the scheme.
Ultimately, the Court found that, whilst there had been two aborted trials, this was regrettable, but did not satisfy the test of exceptional circumstances, and the additional costs were not allowed.
The findings of the Court in this case reflect previous decisions, both in terms of the relevant provision of Part 36 under which costs which fall within the fixed fee regime are to be assessed, and in terms of satisfying the exceptional circumstances test. It is clear that the Court put much store in the “win some, lose some” nature of the fixed costs regime, and found that it was important to have certainty on costs exposure. However, in this instance, it is regrettable that the Claimant was put to such additional expense, for no additional recovery. It would mean a change in Part 36 to remedy this situation, where a Claimant, trying to achieve an early settlement by making a well-pitched Part 36 offer, would be able to claim additional costs for late acceptance, rather than just for a matter which runs all the way to trial.
How can PIC help?
PIC are experts in costs and can provide advice and assistance right from the outset of a claim if needed, we can deal with any technical arguments in respect of costs. We deal with matters from cradle to grave, from budgeting, to bills, from replies, to detailed assessment; we are there to support you all the way.
Jackie Woods, Legal Costs Consultant
20.04.2023