Gavin Edmondson Solicitors Ltd v Haven Insurance Company Ltd
| Jurisdiction | England & Wales |
| Judge | Lord Justice Lloyd Jones,Lord Justice Elias,Lord Justice Laws,or |
| Judgment Date | 02 December 2015 |
| Neutral Citation | [2015] EWCA Civ 1230 |
| Date | 02 December 2015 |
| Docket Number | Case No: A3/2014/3635(A) & A3/2014/3635 |
| Court | Court of Appeal (Civil Division) |
[2015] EWCA Civ 1230
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM WREXHAM DISTRICT REGISTRY, MERCANTILE COURT
HIS HONOUR JUDGE JARMAN QC
3YK08470
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Laws
Lord Justice Elias
and
Lord Justice Lloyd Jones
Case No: A3/2014/3635(A) & A3/2014/3635
Lesley Anderson QC and Martin Budworth (instructed by Gavin Edmondson Solicitors Limited) for the Appellant
Lord Marks QC and James Wibberley (instructed by Flint Bishop Solicitors) for the Respondent
Hearing date: Wednesday 11 th November 2015
This is an appeal by Gavin Edmondson Solicitors Limited ("Edmondson") against the Order of His Honour Judge Jarman QC dated 20 August 2014, dismissing Edmondson's claim against Haven Insurance Company Limited ("Haven") in respect of Haven's conduct in settling on an inclusive basis personal injury claims directly with six clients of Edmondson ("the claimants") with whom Edmondson had concluded conditional fee agreements, thereby depriving Edmondson of its costs.
Edmondson alleges that Haven's conduct was unlawful on the following grounds.
(1) Haven wrongfully prevented Edmondson from establishing a lien on the settlement sums for their costs, thereby justifying equitable intervention by the court with the disposal of damages and costs by ordering Haven to pay Edmondson's costs.
(2) Haven induced breaches of contract between Edmondson and its clients.
(3) Haven is liable in tort for intentionally causing loss to Edmondson by unlawful means, those means being:
(a) breach of the Pre-action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents ("the Protocol");
(b) misuse of confidential information; and
(c) breach of the Data Protection Act 1998.
For its part, Haven denies any impropriety and maintains that there is nothing in law to prevent a direct offer of compensation being made in such circumstances. It submits that the claim discloses no valid cause of action.
The Protocol
The underlying claims all fall within the Protocol, which was first published in March 2010 and which applies where a claim for damages arises from a road traffic accident, the claim includes damages in respect of personal injury and the claimant values the claim at not more than £10,000 on a full liability basis including pecuniary losses but excluding interest. The Protocol describes in great detail the behaviour the court will normally expect of parties, of their legal representatives and of the parties' insurers, involved in such claims. Under the Protocol scheme parties, lawyers and insurers, when required to send information to one another, are expected to do so electronically through a website ("the Portal") established by road accident insurers. While notice of claims falling within the Protocol is expected to be given in accordance with the procedures set out in the Protocol, they are not mandatory. However, there are possible costs consequences if qualifying claims are not processed in accordance with the Protocol.
The preamble to the Protocol states:
"2.1 This Protocol describes the behaviour the court will normally expect of the parties prior to the start of proceedings where a claimant claims damages valued at no more than £10,000 as a result of a personal injury sustained by that person in a road traffic accident."
The aims of the Protocol are set out in paragraph 3.1.
"3.1 The aim of this Protocol is to ensure that
(1) the defendant pays damages and costs using the process set out in the Protocol without the need for the claimant to start proceedings;
(2) damages are paid within a reasonable time; and
(3) the claimant's legal representative receives the fixed costs at the end of each stage in this Protocol."
Claims which no longer continue under the Protocol cannot subsequently re-enter the process. (Paragraph 5.11)
The process is initiated by the completion of the Claim Notification Form ("CNF"). Paragraph 6.1 provides:
"6.1 The claimant must complete and send -
(1) the CNF to the defendant's insurers; …"
The Protocol makes provision for response by the insurer as follows:
"6.10 The defendant must send to the claimant an electronic acknowledgment the next day after receipt of the CNF;
6.11 The defendant must complete the "Insurer Response" section of the CNF ("the CNF response") and send it to the claimant within 15 days;
…
6.15 The claim will no longer continue under this Protocol where the defendant, within the period in paragraph 6. 11 or 6.13
(1) makes an admission of liability but alleges contributory negligence (other than in relation to the claimant's admitted failure to wear a seat belt);
(2) does not complete and send the CNF response;
(3) does not admit liability; or
(4) notifies the claimant that the defendant considers that
(a) there is inadequate mandatory information in the CNF;
or(b) if proceedings were issued, the small claims track would be the normal track for that claim."
The Protocol makes provision for fixed costs to be paid at specified points. Paragraph 6.18 makes provision for Stage 1 fixed costs.
"6.18 Except where the claimant is a child, the defendant must pay the Stage 1 fixed costs in rule 45.29 where
(1) liability is admitted; or
(2) liability is admitted and contributory negligence is alleged only in relation to the claimant's admitted failure to wear a seat belt,
within 10 days after sending the CNF response to the claimant as provided in paragraph 6. 11 or 6.13"
If the claim proceeds to Stage 2, the Protocol requires a Stage 2 Settlement Pack including a medical report to be sent to the defendant within 15 days of the claimant approving a final medical report and agreeing to rely on it. (Paragraph 7.26). There is a 35 day period for consideration of the Stage 2 Settlement Pack by the defendant (Paragraph 7.28).
Paragraph 7.37 provides:
"7.37 Any offer to settle made at any stage by either party will automatically include, and cannot exclude -
(1) the Stage 2 fixed costs in rule 45.29;
(2) an agreement in principle to pay disbursements;
(3) a success fee in accordance with rule 45.31(1). "
Paragraph 7.40 provides in respect of Settlement:
"7.40 Except where the claimant is a child or paragraphs 7.41 and 7.42 apply, the defendant must pay -
(1) the agreed damages less any
(a) deductible amount which is payable to the CRU; and
(b) previous interim payment;
(2) any unpaid Stage 1 fixed costs in rule 45.29;
(3) the Stage 2 fixed costs in rule 45.29;
(4) the relevant disbursements allowed in accordance with rule 45.30; and
(5) a success fee in accordance with rule 45.31 for Stage 1 and Stage 2 fixed costs,
within 10 days of the end of the relevant period in paragraphs 7.28 to 7.30 during which the parties agreed a settlement."
Part 36 CPR, Offers to Settle, has been amended to take account of the Protocol. Part 45 CPR, Fixed Costs, makes specific provision for costs under the Protocol scheme.
The Portal
The General Conditions of Use for Portal Users provide:
"The General Conditions of Use set out the terms and conditions on which You may access and use the Portal…
These General Conditions of Use are legally binding on all users of the Portal to the extent applicable depending on your method of access… Please click the "I agree" box to confirm your acceptance of them. You will not be able to proceed on the Portal unless you agree to be bound by these General Conditions of Use."
Condition 2 provides
"2.1 By using the Portal, You agree, … that
…
(p) You will use the Portal only:
i) for the purpose of communicating in accordance with the Protocol and the Civil Procedure Rules; and
ii) in accordance with all applicable laws, these General Conditions of Use and the User Guide; …
Condition 15 provides;
"All Confidential Information disclosed by one party to the other party under these General Conditions of Use or passed or transmitted via the Portal shall be kept secret by the receiving party and shall be used by the receiving party only for purposes contemplated in these General Conditions of Use. The receiving party agrees that it will not reveal, publish or otherwise disclose the Confidential Information of the disclosing party to any third party without the prior written consent of the disclosing party, except that each party may disclose Confidential Information to its Affiliates, agents and professional advisers or as necessary in the performance of the Agreement or operation of the Portal and to comply with any requirement of the courts, police or regulatory entity requiring such disclosure."
Factual Background
Ainsley Tonkin
Mr. Ainsley Tonkin was involved in a road traffic collision on 10 April 2012. Haven's insured was also involved in the collision and on the 12 April 2012 Haven, having obtained Mr. Tonkin's contact details from its insured's accident report form, contacted Mr. Tonkin concerning a hire vehicle. On 16 April 2012 Mr. Tonkin entered into a conditional fee agreement ("CFA") with Edmondson and on 17 April 2012 the case entered the Portal. On 20 April 2012 Mr. Tonkin telephoned Haven asking "where they go from here". He was told by Louise Richardson of Haven:
"…What we can do is offer you a scheme to compensate you for your injury. We can work out a sum of money and you can put it into your account as soon as you agree on that figure"
Mr. Tonkin told Ms. Richardson that he had his insurance solicitor and volunteered the information that there was a 14 day cooling off period. They then negotiated on the telephone and...
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