CCC (Suing by her mother and litigation friend MMM) v Sheffield Teaching Hospitals NHS Foundation Trust
| Jurisdiction | England & Wales |
| Judge | Mr Justice Ritchie |
| Judgment Date | 13 July 2023 |
| Neutral Citation | [2023] EWHC 1905 (KB) |
| Court | King's Bench Division |
| Docket Number | Claim number: QB-2020-000769 |
[2023] EWHC 1905 (KB)
Mr Justice Ritchie
Claim number: QB-2020-000769
IN THE HIGH COURT OF JUSTICE
KING'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Richard Baker KC and Sarah Edwards (instructed by Taylor Emmet solicitors) for the Claimant
Sarah Pritchard KC (instructed by DAC Beachcroft solicitors) for the Defendant
Hearing date: 12 th July 2023
APPROVED JUDGMENT
Judgment approved by the Court for handing down. This judgment will be handed down by the Judge remotely by circulation to the parties' representatives by email and released to The National Archives. The date and time for hand-down is deemed to be at 10:00 am on Monday 24 th July 2023
The Parties
The Claimant is a young girl aged 8 years and 4 months who sued the Defendant for damages for negligence resulting in her suffering cerebral palsy [CP]. Her mother is her litigation friend.
The Defendant runs the Royal Hallamshire Hospital, Sheffield and four years after her birth admitted that it was responsible for failing to prevent the Claimant suffering severe chronic partial hypoxic ischaemia before and during her birth, which caused the CP.
Background
I handed down judgment on quantum in this case on 12 July 2023. The quantum which I assessed was as follows: gross lump sum award: £6,866,615; Periodical Payments Order [PPO] for life: £394,940 pa index linked to ASHE 6115 at the 80 th centile with the first indexation in December 2023.
Issues
There are two issues to determine. (1) Whether a Part 36 offer has been beaten. (2) Whether an appeal point should be certified for a leapfrog appeal to the Supreme Court.
The Part 36 issue
At the consequentials hearing the Claimant applied for an order under CPR Part 36 for: indemnity costs; an additional award and interest on costs and damages since the date of a Part 36 offer which the Claimant made on 24.5.2023. That offer was as follows: gross lump sum: £7,000,000 and a PPO: £360,000 pa. for life with the first indexation in December 2024.
On the simple figures, at trial, the Claimant beat her own PPO by a substantial amount (£34,940 pa) but failed to beat her lump sum offer which was too high by a substantial amount (£133,385).
The Claimant submitted that on the proper interpretation of Part 36 she had beaten her own Part 36 offer at trial. This was on the basis that if the PPO is capitalised into a lump sum by using the agreed lifetime multiplier used to calculate the lump sum value of the other heads of future loss (21.21), the capital value of the PPO would be £7,635,600 which when added to the lump sum offered (£7,00,000) comes to a total of £14,635,600. This total is less than the total lump sum value of the award which, if calculated in the same way by adding the lump sum of £6,866,615 to the capitalised value of the PPO: £8,376,677 (£394,940 x 21.21) makes a total capitalised value of £15,246,292.
So, the issue is: did the award amount to a judgment “ more advantageous to the Claimant” than the Part 36 offer she made?
Part 36
The relevant parts of Part 36 are as follows:
“Costs consequences following judgment
36.17
(1) Subject to rule 36.21, this rule applies where upon judgment being entered—
(a) …
(b) judgment against the defendant is at least as advantageous to the claimant as the proposals contained in a claimant's Part 36 offer.
..
(2) For the purposes of paragraph (1), in relation to any money claim or money element of a claim, “more advantageous” means better in money terms by any amount, however small, and “at least as advantageous” shall be construed accordingly.
(3) Subject to paragraphs (7) and (8), where paragraph (1)(a) applies, the court must, unless it considers it unjust to do so, order that the defendant is entitled to—
(a) costs (including any recoverable pre-action costs) from the date on which the relevant period expired; and
(b) interest on those costs.
(4) Subject to paragraph (7), where paragraph (1)(b) applies, the court must, unless it considers it unjust to do so, order that the claimant is entitled to—
(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 to an amount which is—
(i) the sum awarded to the claimant by the court; or
(ii) where there is no monetary award, the sum awarded to the claimant by the court in respect of costs—
Amount awarded by the Prescribed percentage court
Up to £500,000
10% of the amount awarded
Above £500,000
10% of the first £500,000 and (subject to the limit of £75,000) 5% of any amount above that figure.
(5) In considering whether it would be unjust to make the orders referred to in paragraphs (3) and (4), the court must take into account all the circumstances of the case including—
(a) the terms of any Part 36 offer;
(b) the stage in the proceedings when any Part 36 offer was made, including in particular how long before the trial started the offer was made;
(c) the information available to the parties at the time when the Part 36 offer was made;
(d) the conduct of the parties with regard to the giving of or refusal to give information for the purposes of enabling the offer to be made or evaluated; and
(e) whether the offer was a genuine attempt to settle the proceedings.
(6) Where the court awards interest under this rule and also awards interest on the same sum and for the same period under any other power, the total rate of interest must not exceed 10% above base rate.
(7) Paragraphs (3) and (4) do not apply to a Part 36 offer—
(a) which has been withdrawn;
(b) which has been changed so that its terms are less advantageous to the offeree where the offeree has beaten the less advantageous offer;
(c) made less than 21 days before trial, unless the court has abridged the relevant period.
(8) …
Rule 36.18
(1) This rule applies to a claim for damages for personal injury which is or includes a claim for future pecuniary loss.
(2) An offer to settle such a claim will not have the consequences set out in this Section unless it is made by way of a Part 36 offer under this rule.
(3) A Part 36 offer to which this rule applies may contain an offer to pay, or an offer to accept—
(a) the whole or part of the damages for future pecuniary loss in the form of—
(i) a lump sum;
(ii) periodical payments; or
(iii) both a lump sum and periodical payments;
(b) the whole or part of any other damages in the form of a lump sum.
(4) A Part 36 offer to which this rule applies—
(a) must state the amount of any offer to pay or to accept the whole or part of any damages in the form of a lump sum;
(b) may state—
(i) what part of the lump sum, if any, relates to damages for future pecuniary loss; and
(ii) what part relates to other damages to be paid or accepted in the form of a lump sum;
(c) must state what part of the offer relates to damages for future pecuniary loss to be paid or accepted in the form of periodical payments and must specify—
(i) the amount and duration of the periodical payments;
(ii) the amount of any payments for substantial capital purchases and when they are to be made; and
(iii) that each amount is to vary by reference to the retail prices index (or to some other named index, or that it is not to vary by reference to any index); and
(d) must state either that any damages which take the form of periodical payments will be funded in a way which ensures that the continuity of payments is reasonably secure in accordance with section 2(4) of the Damages Act 1996 4 or how such damages are to be paid and how the continuity of their payment is to be secured.
(5) Rule 36.6 applies to the extent that a Part 36 offer by a defendant under this rule includes an offer to pay all or part of any damages in the form of a lump sum.
(6) Where the offeror makes a Part 36 offer to which this rule applies and which offers to pay or to accept damages in the form of both a lump sum and periodical payments, the offeree may only give notice of acceptance of the offer as a whole.
(7) If the offeree accepts a Part 36 offer which includes payment of any part of the damages in the form of periodical payments, the claimant must, within 7 days of the date of acceptance, apply to the court for an order for an award of damages in the form of periodical payments under rule 41.8.
(Practice Direction 41B contains information about periodical payments under the Damages Act 1996.)”
The key words in these parts are “better in money terms”.
Analysis
So what does “better in money terms” mean when we are dealing with a combined offer which includes a lump sum and a PPO? To determine this it may help to look at the various options available to the Claimant when making Part 36 offers. Firstly, Part 36 permits single offers and secondly, it permits combined offers.
Single offers
The Claimant may make one or more single lump sum offers to settle specific heads of loss. These are usually the heads for pain, suffering and loss of amenity and past loss, but also often encompass many future loss and expense heads. So, for instance, the future loss of earnings, the equipment and the accommodation claims are often pleaded as lump sums by using the relevant...
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