Abdulrahman Mohammed v The Home Office
| Jurisdiction | England & Wales |
| Judge | Mr Edward Pepperall |
| Judgment Date | 24 November 2017 |
| Neutral Citation | [2017] EWHC 3051 (QB) |
| Docket Number | Case No: HQ16X01806 |
| Court | Queen's Bench Division |
| Date | 24 November 2017 |
[2017] EWHC 3051 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Mr Edward Pepperall QC
SITTING AS A DEPUTY HIGH COURT JUDGE
Case No: HQ16X01806
Mr Chris Buttler (instructed by Leigh Day) for the Claimant
Mr Benjamin Tankel (instructed by the Government Legal Department) for the Defendant
Hearing date: 8 November 2017
Approved Judgment
I direct that pursuant to CPR PD39A para 6.1 no official shorthand note shall be taken of this judgment and that copies of this version as handed down may be treated as authentic.
Mr Edward Pepperall QC:
Abdulrahman Mohammed was unlawfully detained by the Home Office in purported exercise of the Secretary of State's powers to detain foreign criminals with a view to deportation over three separate periods totalling 445 days between 12 September 2012 and 4 March 2016. By my judgment upon the trial of Mr Mohammed's false imprisonment claim — [2017] EWHC 2809 (QB) — I awarded him damages of £78,500. Counsel subsequently agreed interest on such damages at the rate of 2% per annum from the service of proceedings to judgment in the sum of £2,753.
Upon handing down judgment, Mr Buttler drew my attention to a Claimant's Part 36 offer of £70,000 made by Leigh Day's letter of 2 March 2017. Since Mr Mohammed has obtained a judgment that is more advantageous than his March offer, r.36.17(4) of the Civil Procedure Rules 1998 requires the court, unless it considers it unjust to do so, to make the following orders:
"(a) interest on the whole or part of any sum of money (excluding interest) awarded, at a rate not exceeding 10% above base rate for some or all of the period starting with the date on which the relevant period expired;
(b) costs (including any recoverable pre-action costs) on the indemnity basis from the date on which the relevant period expired;
(c) interest on those costs at a rate not exceeding 10% above base rate; and
(d) provided that the case has been decided and there has not been a previous order under this sub-paragraph, an additional amount, which shall not exceed £75,000, calculated by applying the prescribed percentage set out below [which in this case is 10%] to an amount which is –
(i) the sum awarded to the claimant on the claim …"
IS IT UNJUST TO MAKE THE USUAL ORDERS?
Mr Tankel, for the Home Office, rightly accepted that it is not unjust for the court to make the usual orders under r.36.17(4). The purpose of Part 36 is plainly to encourage litigants both to make and accept reasonable settlement offers. As Briggs J. observed in Smith v. Trafford Housing Trust [2012] EWHC 3320 (Ch), at [13], such purpose is undermined if the court departs too readily from the scheme of Part 36.
ENHANCED INTEREST ON THE AWARD
Mr Tankel correctly submitted that the court's duty, pursuant to r.36.17(4)(a), is to award interest not at 10% over base, but at a rate not exceeding 10% over base. In exercising my discretion to set the rate of enhanced interest, Mr Tankel submitted that I should take into account my own observations at [66]–[67] of my main judgment, where I observed:
"66. Some reading this judgment might well question why a foreign citizen who has so thoroughly abused the hospitality of this country by the commission of serious criminal offences is entitled to any compensation. There are, perhaps, three answers to such sceptic:
66.1 First, there are few principles more important in a civilised society than that no one should be deprived of their liberty without lawful authority.
66.2 Secondly, it is essential that where a person is unlawfully imprisoned by the state that an independent judiciary should hold the executive to account.
66.3 Thirdly, justice should be done to all people …..
67. Mr Mohammed is a prolific and violent offender. I can well understand why the Home Secretary might wish to deport him. She has not, however, been able to do so, largely because of the very real risk that deportation to Somalia would pose. Like Mr Kambadzi, he is not the most wicked of men, but his presence in the UK is not conducive to the public good. Nevertheless, in a civilised society, he is entitled to justice. Specifically, he is entitled not to be falsely imprisoned and, given the Home Office's admission that he has been unlawfully detained, he is now entitled to the compensation that I have awarded."
Mr Tankel expressly acknowledged the force of those observations, but argued that while, for the reasons I gave, Mr Mohammed is entitled to proper compensation, the court should nevertheless temper its award of interest under Part 36 by reference to Mr Mohammed's character.
The Court of Appeal gave guidance as to the proper approach to awards of enhanced interest under r.36.17(4) in OMV Petrom SA v. Glencore International AG [2017] EWCA Civ 195, [2017] 1 W.L.R. 3465. Sir Geoffrey Vos C. observed, at [23] and [29], that there is a distinction between the decision to make each of the orders under r.36.17(4) and decisions as to the proper rates of enhanced interest pursuant to paragraphs (a) and (c). In respect of the rate of enhanced interest on the award, he said, at [31]–[34]:
"31. First, I should say that I do not regard the specified rate of 10% as a starting point. The words of the rule provide for enhanced interest to be awarded 'at a rate not exceeding 10% above base rate.' That does not make the figure of 10% a starting point. It makes it the maximum possible enhancement.
32. Secondly, in my judgment, the objective of the rule has always been, in large measure, to encourage good practice. As Lord Woolf put it in the Petrograde case, 'Part 36.21(2) and (3) create the incentive for a claimant to make a Part 36 offer', and a party who behaved unreasonably 'forfeits the opportunity of achieving a reduction in the rate of additional interest payable.' Chadwick L.J. in the McPhilemy case said that it was 'an incentive to encourage claimants to make, and defendants to accept, appropriate offers of settlement.'
33. In my judgment, the likelihood that the provisions for all four possible awards are not entirely compensatory is supported by the negative formulation of CPR Part 36.14(3)(a) to the effect that 'the court will, unless it considers it unjust to do so, order that the claimant is entitled to [the four awards].' If the rule-makers had intended to say that all or any of the awards were only to be made if they represented compensation for litigation inconvenience, it would have been very easy to say so."
After referring to the thrust of the CPR after the Jackson reforms, the Chancellor dismissed the argument that the award of enhanced interest under what is now r.36.17(4)(a) was intended to be entirely compensatory and made plain, at [36], that first instance judges are not required to engage in the complex and unnecessary exercise of identifying the cost of the prolongation of the litigation. He then gave this guidance in respect of the assessment of enhanced interest under r.36.17(4)(a), at [38]–[39]:
"38. The court undoubtedly has a discretion to include a noncompensatory element to the award …, but the level of interest awarded must be proportionate to the circumstances of the case. I accept that those circumstances may include, for example:
(a) the length of time that elapsed between the deadline for accepting the offer and judgment,
(b) whether the defendant took entirely bad points or whether it had behaved reasonably in continuing the litigation, despite the offer, to pursue its defence, and
(c) what general level of disruption can be seen, without a detailed inquiry, to have been caused to the claimant as a result of the refusal to negotiate or to accept the Part 36 offer.
But there will be many factors that may be relevant. All cases will be different. Just as the court is required to have regard to 'all the circumstances of the case' in deciding whether it would be unjust to make all or any of the four possible orders in the first place, it must have regard to all the circumstances of the case in deciding what rate of interest to award under Part 36.14(3)(a). As Lord Woolf said in the Petrograde case, and Chadwick L.J. repeated in the McPhilemy case, this power is one intended to achieve a fairer result for the claimant. That does not, however, imply that the rate of interest can only be compensatory. In some cases, a proportionate rate will have to be greater than purely compensatory to provide the appropriate incentive to defendants to engage in reasonable settlement discussions and mediation aimed at achieving a compromise, to settle litigation at a reasonable time, and to mark the court's disapproval of any unreasonable or improper conduct, as Briggs L.J. put the matter, pour encourager les autres.
39. The culture of litigation has changed even since the Woolf reforms. Parties are no longer entitled to litigate forever simply because they can afford to do so. The rights of other court users must be taken into account. The parties are obliged to make reasonable efforts to settle, and to respond properly to Part 36 offers made by the other side. The regime of sanctions and rewards has been introduced to incentivise parties to behave reasonably, and if they do not, the court's powers can be expected to be used to their disadvantage. The parties are obliged to conduct litigation collaboratively and to engage constructively in a settlement process."
Applying that guidance, the Court of Appeal substituted the full 10% enhancement for the trial judge's own lower award. That was, however, an extreme case. As the Chancellor recorded, at [1], the defendant's case had "rested in large measure on the evidence of witnesses who were liars and Glencore put Petrom through the hoops of having to establish liability, in a very flagrant case of fraud, in a manner...
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