Hany Younan v First Group Plc
| Jurisdiction | England & Wales |
| Judge | Master Leonard |
| Judgment Date | 18 February 2011 |
| Neutral Citation | [2011] EWHC 90214 (Costs) |
| Court | Senior Court Costs Office |
| Date | 18 February 2011 |
| Docket Number | Case No: HQ08X02033 |
[2011] EWHC 90214 (Costs)
IN THE HIGH COURT OF JUSTICE
SENIOR COURTS COSTS OFFICE
Clifford's Inn, Fetter Lane
London, EC4A 1DQ
Master Leonard, COSTS JUDGE
Case No: HQ08X02033
SCCO Ref: CL/1002891
Mr Roger Mallalieu (counsel instructed by Irwin Mitchell) for the Claimant
Mr Simon Gibbs (costs lawyer instructed by Kennedys) for the Defendant
Hearing date: 20 December 2010
In this action the Claimant sought damages from the Defendant following a road traffic accident on 11 December 2002, in which the Claimant suffered cervical and lumbar injuries. On 1 April 2009, after a two day trial, HH Judge Richard Seymour QC (sitting as a Judge of the High Court) gave judgment for the Claimant on the issue of liability for damages to be assessed, the Defendant to pay the Claimant's costs of the action to the date of judgement. A counterclaim by the Defendant was dismissed.
In October 2010 the action concluded with a consent order settling quantum and providing for the Defendant to pay the Claimant's costs of the action. This assessment is of two bills, the first representing the Claimant's costs as claimed up to 1 April 2009 and the second the Claimant's costs thereafter. They total £225,218.61 and £20,608.90 respectively.
The Issues
On the assessment of the Claimant's costs a number of preliminary issues arose. These were:
i) Whether the Claimant's costs should be reduced by a given overall percentage to reflect misconduct on the part of the Claimant. The Defendant relies on two key allegations: first that the Claimant exaggerated his claim and second that he procured fabricated evidence from a witness to support his case on liability.
ii) Whether it was reasonable for the Claimant to instruct leading counsel, or whether the decision to do so was made in consequence of the exaggeration of his claim, so that the costs so incurred should be disallowed.
iii) Whether a conditional fee agreement dated 3 April 2003 between the Claimant and Percy Hughes & Roberts was rendered unenforceable by any breach of Regulation 4(2)(e)(ii) of the Conditional Fee Agreements Regulations 2000.
iv) Whether it is necessary for the Claimant to make an application for Relief from Sanctions and if so whether it should be granted.
v) The level of success fees claimed by Solicitors and Counsel for the Claimant. (As the accident occurred in December 2002, the fixed fee regime for Road Traffic Accidents occurring from 6 October 2003 does not apply.)
The History of the Action
Following the accident the Claimant instructed Percy Hughes & Roberts of Birkenhead, who acted under a standard AAH (Accident Advice Helpline) conditional fee agreement dated 11 April 2003. A letter of claim was written on 17 April 2003 addressed to "First Bus Co". The letter of claim was acknowledged by First Capital East Ltd, who on 1 May 2003 confirmed that the matter had been passed to their claims handlers, Transportation Claims Ltd. In a letter of 11 July 2003, Transportation Claims Ltd stated that they were acting "on behalf of First Centre West".
In a letter of 9 March 2005 addressed to Percy Hughes & Roberts, Transportation Claims Ltd confirmed that "… negligence is no longer in dispute subject to causation". The letter referred to their client as "First Centre West".
A claim form was issued in the Birkenhead County Court on 8 December 2005, just before the expiry of the limitation period, naming the Defendant as "First Group". In a letter of 13 February 2006, Claims Management Group Limited (CMGL) advised that they had been instructed by Transportation Claims Ltd.
The Claim form, together with brief Particulars of Claim indicating that a full schedule of damages would be served in due course, was served by post under cover of a letter dated 4 April 2006 addressed to "First Group" at "Station Road, Wilsden Junction London WN10 4XB". The claim form limited damages to £5,000. The Particulars of Claim specified a claim for damages exceeding £5,000 but not exceeding £15,000.
According to the certificate of service on file, the claim form and Particulars of Claim were not accompanied by any medical report, schedule of loss or the response pack required by CPR 7.8(1). The covering letter was also incorrectly addressed; apart from the misspelling of "Willesden Junction" the post code should have been "NW10". The letter and its enclosures do not appear to have been copied to CMGL at the time of sending.
The addressee did not respond to the letter of 4 April 2006, which may well never have been received. However, a request for default judgment made by Percy Hughes & Roberts on 19 May 2006 was refused by the court on the basis that there were "no Particulars of Claim or medical report on file".
In July 2006 the Claimant changed his solicitors. He instructed Irwin Mitchell, with whom he signed a conditional fee agreement dated 28 October 2006.
After obtaining the file of Percy Hughes & Roberts, on about 23 August 2006 Irwin Mitchell notified CMGL that they had taken over the claim. They wrote to CMGL enclosing a copy of the letter of 4 April 2006 with (unspecified) enclosures. Irwin Mitchell offered 28 days for CMGL to instruct solicitors, failing which they warned that they would renew the application for judgment in default. That letter and several reminders were ignored.
Accordingly on 5 November 2006 Irwin Mitchell obtained default judgement for the Claimant for damages to be assessed. Kennedys were then instructed by the Defendant. On 22 January 2007 directions were given, counsel for both parties attending. The claim was allocated to the multi-track and, by agreement, transferred to Central London County Court.
By the time an updated schedule of costs was served by the Claimant on 14 August 2007, the quantum of claim included a very substantial loss of earnings claim, capable of exceeding £1,000,000. The Claimant's case was that shortly before the accident he had entered into a contract with Green Creation, an Egyptian trading company, to act as technical director at a starting net monthly salary of £5,200, and that he had lost that position as a result of the injuries he had sustained in the accident.
In the meantime, on 31 July 2007, the Claimant served his witness statements. These included a statement from one Mr Safarpour of 18 May 2007 (mis-dated 18 May 2008 by Mr Safarpour). This conflicted with a previous (albeit unsigned and undated) statement of Mr Safarpour provided on a standard form to Norwich Union in March 2003. In that document he had confirmed that he did not know the Claimant and that he had witnessed the accident, which was the fault of the Defendant. In his statement of 18 May 2007 he confirmed that he had known the Claimant for over 12 years, that they were close friends, and that he did not witness the accident.
This was significant because Mr Safarpour's unsigned statement had been sent by Percy Hughes & Roberts to Transportation Claims Ltd with a letter dated 9 May 2003, inviting an admission of liability in the light of what appeared to be independent eye — witness evidence.
On 24 August 2007 Kennedys wrote to Irwin Mitchell referring to the discrepancies in Mr Safarpour's evidence. Irwin Mitchell obtained a second witness statement from Mr Safarpour dated 7 October 2007. That statement clarified his position in that he confirmed that he had witnessed the accident and gave more detail of the circumstances, but did little to address previous discrepancies.
It would appear from the correspondence between the parties that another accident/enquiry form may have been submitted to the Westminster Traffic Unit dated 20 January 2003, in which Mr Safarpour confirmed that he had known the Claimant for some time. That document had not been seen by the Defendant at the time. I have not been able to identify it. It is not referred to in His Honour Judge Seymour QC's judgement on liability, referred to below, which considered Mr Safarpour's evidence in some detail. For those reasons, and because it would not evidently have been of much assistance in addressing concerns about discrepancies in key aspects of Mr Safarpour's evidence, I do not treat it as material.
In September and October 2007, Kennedys obtained surveillance evidence which showed the Claimant moving freely and walking distances of about a mile, in direct contradiction to the evidence he had given (in his witness statement and to medical experts) about his physical state of health.
Kennedys wrote again to Irwin Mitchell on 6 November 2007 stating that the Defendant's admission of liability had been made promptly after receipt of Mr Safarpour's first statement and indicating that that admission had been made n reliance upon Mr Safarpour's purportedly independent eye witness account of the accident.
In fact, as will be evident from the sequence of events outlined above, some considerable time elapsed between receipt of Mr Safarpour's undated statement and the admission of liability. The weight attached to Mr Safarpour's undated statement in making that admission remains unclear. A witness statement by a Mr Jones incorporating a rather bald assertion to the effect that the Defendant had made its admission on the basis of Mr Safarpour's first statement was not relied upon at the liability trial.
Kennedys also enclosed with their letter of 6 November 2007 copies of the surveillance evidence. They stated that they would now be instructing their own psychiatric and orthopaedic evidence and expressed their client's grave concerns at the suspicion that "a fraudulent claim has been presented to our client".
Kennedys advised that the Defendant was considering an application to resile from the admission of liability on the basis that the...
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