Fixed Costs – An end to Detailed Assessment? A view from the Costs Draftsman

The advent of Fixed Costs (CPR 45.29) has, firstly in small measure within both the Small Claims Track and RTA cases and, more recently, in the expanded RTA and EL/PL schemes, been heralded as bringing in a new age of certainty to legal costs. Certainly this has been the aspiration of those who have been developing the Rules, however it appears that paying parties are still keen to challenge costs claims where such Rules have sought to avoid such challenges.

One particularly notable example is in respect of the amount of Fixed Costs which are allowable in matters started under the RTA Protocol, where the CNF has been submitted on or after 31 July 2013. In such circumstances, the only costs which are allowed (subject to CPR 45.29F, G, H & J) are those prescribed by CPR 45.29C and disbursements as set out in CPR 45.29I.

With regard to the fixed costs allowable in such RTA matters, CPR 45.29C then helpfully sets out a table (Table 6B; the same is also the case in respect of EL/PL claims (see CPR 45.29D & E, along with Tables 6 C & D)) detailing the amounts of those costs, dependent upon the stage at which any given matter has reached, as follows

“… TABLE 6B Fixed costs where a claim no longer continues under the RTA Protocol A. If Parties reach a settlement prior to the claimant issuing proceedings under Part 7 Agreed damages At least £1,000, but not more than £5,000 More than £5,000, but not more than £10,000 More than £10,000, but not more than £25,000 Fixed costs The greater of— (a) £550; or (b) the total of— (i) £100; and (ii) 20% of the damages The total of— (a) £1,100; and (b) 15% of damages over £5,000 The total of— (a) £1,930; and (b) 10% of damages over £10,000 B. If proceedings are issued under Part 7, but the case settles before trial Stage at which case is settled On or after the date of issue, but prior to the date of allocation under Part 26 On or after the date of allocation under Part 26, but prior to the date of listing On or after the date of listing but prior the date of trial Fixed costs The total of— (a) £1,160; and (b) 20% of the damages The total of— (a) £1,880; and (b) 20% of the damages The total of— (a) £2,655; and (b) 20% of the damages C. If the claim is disposed of at trial Fixed costs The total of— (a) £2,655; and (b) 20% of the damages agreed or awarded; and (c) the relevant trial advocacy fee D. Trial advocacy fees Damages agreed or awarded Not more than £3,000 More than £3,000, but not more than £10,000 More than £10,000, but not more than £15,000 More than £15,000 Trial advocacy fee £500 £710 £1,070 £1,705 …”

and further defines various aspects of the Table, at CPR 45.29C(4), thus

“(4) In Table 6B— (a) in Part B, ‘on or after’ means the period beginning on the date on which the court respectively— (i) issues the claim; (ii) allocates the claim under Part 26; or (iii) lists the claim for trial; and (b) unless stated otherwise, a reference to ‘damages’ means agreed damages; and (c) a reference to ‘trial’ is a reference to the final contested hearing.”

the writer suspects, in the hope that the same is sufficiently clear so as to avoid any doubt.

So, it might be assumed that that would be an end to it…but it appears that it isn’t.

The matter originally came to the fore in the County Court at Birkenhead, before District Judge Doyle, in the matter of Taylor v Bunter (18 September 2014) in which the paying party sought to argue that the matter, which had been listed for a Disposal Hearing but settled beforehand and not Allocated attracted only the costs at the first column of Part B of Table 6B, namely £1,160.00 plus 20% of the damages. Their argument contended that, as the matter had concluded prior to Allocation, irrespective of the fact that the matter had been listed for a Disposal, a Disposal hearing was not a Trial within the meaning of CPR 45.29C(4)(c) and further that the ‘triggers’ for each column applying should be read singularly, not consecutively.

In finding for the Claimant receiving party, District Judge Doyle ruled that

“… 26. The fact that the case has not been allocated to track under Part 26 is irrelevant to the question of whether the claimant is entitled to the costs in columns 1 or 3 of Table 6B. There is no requirement under Part 26 to allocate to track. Columns 1, 2 & 3 of Table B are not in my view intended to be sequential, and are in fact disjunctive.

27. This is apparent from a reading of CPR 45.20 9C(4)(a) which makes clear by the use of the word ‘or’ that the three trigger events for the award of a particular set of fixed costs are not stages which must be passed in turn, but stand-alone requirements. ‘On or after’ any of these has occurred, the cost consequences in the relevant table follow.

28. …

29. In my judgment the fact that the disposal hearing might have been used to directions is irrelevant. The case was listed for disposal, and the default position is that it will be concluded on that date, as the majority of cases in this Court are. It was accepted by counsel for the defendant that there is nothing in the practice direction to prevent the case being listed for a final disposal hearing, and in that case it would be a final contested hearing…

…

37. Therefore in my judgment once a case has been listed for disposal the fixed costs in column 3 of Part B apply and that is what I will award in this case.

…”

Whilst this might have appeared to resolve the issue in fairly robust and unambiguous (albeit non-binding) terms, paying parties were keen to resurrect the issue for another attempt, this time before District Judge Shaw in the County Court at Bolton (28 January 2015) in the matter of Fisher v Liverpool Victoria Friendly Society.

In that matter, which also had been listed for a Disposal Hearing but not Allocated, District Judge Shaw ruled that a Disposal Hearing was not a Trial, referring to CPD 26, section 12.4 and that the nature of the hearing should be looked at in the context of the case, and thus further that the columns within Table 6B were cumulative rather than separate and distinct, such that progress through the Table could not be made beyond column 1, Part B, without the matter having been Allocated, irrespective of whether it had been listed.

Accordingly, the receiving party was restricted to £1,160.00 plus 20% of the damages.

Having 2 conflicting authorities, whether binding or not, was always going to put the proverbial ‘cat amongst the pigeons’ and has only fostered yet more conflict between the parties, with both paying and receiving parties hoping that their advocates will be the more persuasive before the District Bench. Indeed, the writerhas been the successful party in such an argument. However, what is clear is that, if the Rules are to operate as intended, such disputes require to be resolved with further, binding guidance.

It is therefore with some degree of relief that the news was received that His Honour Judge Wood QC in the County Court at Liverpool has made a ‘leap-frog’ order in the matter of Bird v Acorn Group (Case No – A89YJ009), sending that Appeal directly to the Court of Appeal noting

“It is apparent that there are a number of conflicting decisions from judges at first instance in relation to the application of the fixed-costs regime, and in particular whether the columns set out in the tables are to be considered individually or sequentially in stages, and whether a disposal amounts to a final hearing.

“It is understood that whilst the costs involved on this occasion are relatively small, this situation is likely to arise in many hundreds of cases and will affect other interested parties, including insurers and litigation funders, who may wish to participate in the appeal process.”

The Appeal is currently listed within a window between October 2015 and February 2016, and whilst relating to a PL matter, it is hoped that the guidance provided within the eventual ruling by the Court of Appeal will resolve the much wider area of dispute across the Fixed Costs regime in respect of RTA and EL matters also.