AH (a Protected Party Proceeding by her Litigation Friend, XXX) v Lewisham Hospital NHS Trust

JurisdictionEngland & Wales
CourtSenior Court Costs Office
JudgeDeputy Master Campbell
Judgment Date12 January 2016
Neutral Citation[2016] EWHC B3 (Costs)
Date12 January 2016
Docket NumberClaim No.HQ11X03255

[2016] EWHC B3 (Costs)

IN HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

SENIOR COURTS COSTS OFFICE

Deputy Master Campbell

Claim No.HQ11X03255

Between:
AH (a Protected Party Proceeding by her Litigation Friend, XXX)
Claimant
and
Lewisham Hospital NHS Trust
Defendant

Mr Robert Marven (instructed by Irwin Mitchell) for the claimant

Mr Alexander Hutton QC (instructed by Clyde & Co) for the defendant

Hearing dates 21 and 22 September 2015

Deputy Master Campbell
1

This judgment addresses a point of principle which arises at the outset of the detailed assessment of the costs of the claimant (acting through her litigation friend ("the claimant")) which are payable by the defendant pursuant to an order dated 13 December 2013. It also deals with two further matters, the level of success fees and an After-the-Event ("ATE") insurance premium if the first issue is decided in the claimant's favour.

2

The first issue concerns the defendant's liability in principle for the success fees and ATE insurance premium which the claimant contends is recoverable under the terms of a Conditional Fee Agreement ("CFA") she made with her solicitors Irwin Mitchell on 27 March 2013. There is a further claim for a success fee charged in a CFA entered into by the claimant's counsel the previous day. It is the defendant's case, advanced by Mr Hutton QC, that the claims are unreasonable because prior to the CFAs, the claimant was in receipt of legal aid which covered proceedings she had brought against the defendant for damages following an unsuccessful haemorrhiodectomy on 8 September 2008. The claimant disagrees; her case put forward by Mr Robert Marven is that she had made a reasonable choice to change her method of funding from legal aid to the CFA and that, accordingly, in principle, the sum of £32,352.72 for the success fee for Irwin Mitchell and £4,386 for counsel plus £18,881.78 for the ATE premium are recoverable from the defendant in her bill.

3

The hearing lasted the best part of two days during the course of which the claimant's solicitor at Irwin Mitchell, Juanita Cumberland, gave evidence and was cross-examined by Mr Hutton in respect of witness statements she had made on 13 November 2014 and on 18 September 2015 respectively. In addition, a bundle of relevant documents had helpfully been agreed by the parties and I also had the benefit of skeleton arguments prepared by counsel together with a list of authorities. At the conclusion of the hearing I reserved judgment.

BACKGROUND

4

The claimant, who was born on 4 September 1963, had been admitted to University Hospital Lewisham on 8 September 2008 for day surgery in the form of a stapled haemorrhoidectomy. After the surgery, the claimant was noted to have been in considerable pain, followed by sickness, abdominal pain and constipation. She then developed sepsis. A laparotomy, which was later performed but not until 16 September 2008, revealed a disruption to the staple line over approximately 1.5 cm. Thereafter the claimant had developed adult respiratory distress syndrome and had remained seriously unwell in the intensive care unit where she later suffered a series of strokes and sustained irreversible brain damage.

5

In due course, the claimant through her litigation friend, had consulted solicitors. An application for legal aid was made at the outset of the claim and a certificate had been granted on 4 March 2010 which was converted into a full representation order in June 2011.

6

The claim was complex, the claimant having been left with devastating brain damage (blind, paralysed in both legs with no grip in her hands, living in a BUPA care home with two children aged 10 and 12 no longer being cared for by her) following what had been expected to be a routine day procedure. In her letter of claim sent on 7 September 2011, the claimant alleged that the surgery performed on 8 September 2008 had been negligent and had caused a perforation as well as there having been a delay in recognising and treating infection thereafter. In addition it was contended that there had been a failure to perform a laparotomy and/or/and examination under anaesthetic earlier than 16 September 2008.

7

The defendant had replied 19 January 2011 in a letter which had contained a partial admission of breach of duty, in that the breach had led the claimant to being admitted to the Intensive Care Unit (see paragraph 19 below). However, causation remained in issue in relation to the resulting brain damage (see the skeleton arguments of Mr Marven and Mr Hutton at paragraphs 2 and 6 respectively).

8

The chronology continued as follows:-

• 31 January 2013: Particulars of Claim, schedule of loss and a medical report served.

• 27 February 2013: Irwin Mitchell apply to discharge the legal aid certificate.

• 18 March 2013: CPR Part 36 offer by the defendant in the sum of £285,000 inclusive of CRU.

• 26 March 2013: CFA made between counsel and Irwin Mitchell with a 67% success fee

• 27 March 2013: claimant enters into a CFA with a success fee of 80% if the claim settled more than three months before the trial/trial window and thereafter 100%.

• 28 March 2013: Notification given of an ATE policy by Irwin Mitchell to Clyde & Co solicitors for the defendant and of the change in legal funding.

• 12 July 2013: CPR Part 36 offer by the claimant in the sum of £46,7524.

23 July 2013: Clyde & Co request from Irwin Mitchell a breakdown of the damages and details of costs to date.

• 27 August 2013: Irwin Mitchell inform Clyde & Co that "our estimate of general damages is £175,000".

• 13 September 2013: Part 36 offer by the defendant of £325,000 plus CRU of £26,409.

• 26 September 2013: defendant's offer accepted.

• 13 December 2013: settlement approved by the court.

LAW: THE RULES AND AUTHORITIES

9

The law with which this judgment is concerned is the following (taken in part with thanks from Mr Hutton's skeleton argument).

10

It is agreed that, for this purpose, the pre-1 st April 2013 Civil Procedure Rules ("CPR") apply—

CPR 44.4 (as then in force) provides as follows:-

"..(2) where the amount of costs is to be assessed on the standard basis the court will (a) only allow costs which are proportionate to the matters in issue; and (b) resolve any doubt which it may have as to whether costs were reasonably incurred or reasonable and proportionate in amount in favour of the paying party…"

CPR 44.5 :—"(1) the court is to have regard to all the circumstances in deciding whether costs are – (a) if it is assessing on the standard basis — (i) proportionately and reasonably incurred; (ii) were proportionate and reasonable in amount…."

11

Paragraph 11.7 of the Costs Practice Direction ("CPD") in force until 31 March 2013 provides that:-

"When the court is considering the factors to be taken into account in assessing an additional liability, it will have regard to the facts and circumstances as they reasonably appeared to the solicitor or counsel when the funding arrangement was entered into"

12

Paragraph 8:-

"In deciding whether a percentage increase is reasonable, relevant factors to be taken into account include:

(a) the risk that the circumstances in which the costs, fees or expenses would be payable might or might not occur

(b) the legal representative's liability for any disbursement

(c) what other methods of financing the costs were available to the receiving party".

13

On 1 April 2013, amendments were made to the CPR and to the entitlement of parties to CFAs to recover from paying parties, success fees and ATE premiums. S.44 and s.46 Legal Aid and Sentencing of Offenders Act 2012 ("LASPO") made these additional liabilities irrecoverable for CFAs and ATE Insurance policies made on or after 1 April 2013 in most types of case including clinical negligence.

14

In Sarwar v Alam (2002) 1 WLR 125 the court considered whether it was reasonable for the receiving party to enter into a CFA and/or ATE policy thereby incurring a success fee and ATE premium. In that case, the claimant had been a passenger driven by the defendant driver and Before The Event ("BTE") insurance had been available to make a claim on the driver's own insurance. The Court of Appeal held that it was reasonable not to use the driver's BTE policy and accordingly, the success fee and ATE premium were, in principle, recoverable. It also said this:-

"The governing rule is CPR rule 44.4(1) which imposes a duty on the court to have regard to all the circumstances in deciding whether any item costs was proportionately reasonably incurred (paragraph 12) ….

….The central question in this appeal is whether it was reasonable in all the circumstances for Mr Sarwar, acting on his solicitor's advice, to incur the cost of an ATE premium without taking further enquiries into the possible existence of BTE cover (paragraph 13)…

….The overriding principle is that the claimant assisted by his/her solicitor, should act in a manner that is reasonable (paragraph 50)…

….We deprecate any attempt to equate the question of reasonableness that a cost judge has to decide with the question whether the claimant's solicitor has been in breach of duty to his/her client. If a solicitor gives advice which proves unsound, it will not necessarily follow that the advice was negligent. The advice will necessarily be based on information provided by the client. If the information is inadequate or inaccurate, the advice may prove to be unsound without any question of fault on the part of the solicitor (paragraph 51)…

….The philosophy contained in CPR 1.1(2)(c) and the express provisions of CPR 44.5, require the court to ensure that no costs are incurred which are not reasonable and proportionate. While we would not interpret the sensible non-exhaustive guidance given in paragraphs 11.7 to 11.10 of the costs practice direction as if they were words of a statute, they point the reader...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT