Download Liability Brief - Kennedys

In both cases, the Claimants were involved in road traffic accidents. Quantum was
agreed, with the Claimants accepting Part 36 offers made by the Defendants, prior
to proceedings being issued, of less than £10,000. Costs could not be agreed and
both Claimants issued Part 8 proceedings for costs under the procedure set out in
CPR 44.12A.
Although generally costs would be assessed in this type of case on the predictive
basis, there is a conflict in the CPR between CPR 36.10 and CPR 45 Section II.
In both cases, the Claimants sought to argue that the Part 36 provisions meant that
they had an automatic entitlement to standard basis costs which superseded the
provisions of Part 45. They argued that Part 36 was essentially a deemed order for
costs in its own right and that an alternative order should not, therefore, be made.
In Solomon, His Honour Judge Platts overturned the initial decision of District
Judge Wheeler that standard basis costs should apply. He decided that the
provisions of Part 36 only applied where proceedings had been issued. Since they
had not been issued, there was no deemed order for costs and the Court was bound
by the provisions of 44.12A(4A).
In Oliver, District Judge Smith also found that predictive costs should apply. He
reached his conclusion on the basis that the effect of Part 45 is to establish the
reasonable and proportionate costs of the items to which it relates for the purpose
of the assessment of recoverable costs in cases of the kind to which it refers.
Held: The Court of Appeal dismissed the Claimants’ appeals, holding that
predictive costs should apply in both cases. Lord Justice Moore-Bick referred to the
established principle that, when an instrument contains both specific and general
provisions and some of those are in conflict, the general are intended to give way
to the specific. He considered that, as the provisions in Part 36.10 are general and
the provisions of Section II of Part 45 are specific, the provisions in Part 45 should
govern the cases to which it applies.
Comment: Since the introduction of predictive costs, claimants have sought ways
of escaping their restrictions and limitations, for example by prematurely issuing
claims or instructing counsel to attend infant approval hearings, or by any number
of other increasingly inventive means.
It is therefore both refreshing and reassuring to see the Court of Appeal reigning in
such attempts and maintaining the spirit of the scheme as it was intended.
Both these cases dealt only with proceedings issued under CPR 44.12A. However, it
is always open to a claimant to issue proceedings for outstanding costs under CPR
Part 7 or Part 8 instead. Lord Justice Moore-Bick, whilst accepting he was not
considering this issue, did however consider that it was “very doubtful” such an
attempt to avoid predictive costs would be successful.
For further information please contact Elizabeth Love on +44 114 253 2048 or email
e.love@kennedys-law.com.
Page 2 of 10