Legal Aid Board v Russell
| Jurisdiction | England & Wales |
| Judge | Lord Keith of Kinkel,Lord Emslie,Lord Brandon of Oakbrook,Lord Templeman,Lord Ackner |
| Judgment Date | 16 May 1991 |
| Judgment citation (vLex) | [1991] UKHL J0516-1 |
| Date | 16 May 1991 |
| Court | House of Lords |
[1991] UKHL J0516-1
House of Lords
Lord Keith of Kinkel
Lord Emslie
Lord Brandon of Oakbrook
Lord Templeman
Lord Ackner
My Lords,
I have had the opportunity of considering in draft the speech to be delivered by my noble and learned friend Lord Ackner. I agree with it, and for the reasons he gives would dismiss this appeal.
My Lords,
I have had the opportunity of considering in draft the speech to be delivered by my noble and learned friend Lord Ackner. I agree with it, and for the reasons he gives would dismiss this appeal.
My Lords,
For the reasons given in the speech prepared by my noble and learned friend, Lord Ackner, I would dismiss the appeal.
My Lords,
For the reasons given in the speech prepared by my noble and learned friend, Lord Ackner, I would dismiss the appeal.
My Lords,
This is an appeal by leave of the Court of Appeal (Lord Donaldson of Lymington M.R., Butler-Sloss and Taylor L.JJ.) from the judgment and order of the Court of Appeal dated 28 June 1990 [1990] 2 Q.B. 607. The Court of Appeal allowed the appeal of the respondent (the defendant in the action) from the judgment and order of his Honour Judge Dobry Q.C. (sitting as a judge of the High Court) dated 21 March 1989.
The short issue raised by this appeal is whether or not acceptance under Rules of the Supreme Court Order 22 rule 3 of money paid into court, entitles the party accepting that payment to interest on his costs under sections 17 and 18 of the Judgments Act 1838, and, if so, whether the right to such interest runs from the date of the acceptance of the payment or from some other, and if so, what date. His Honour Judge Dobry Q.C. upheld the decision of Mr. District Registrar Donaldson that the party accepting such a payment into court is entitled to interest on his costs from the date of acceptance of the money in court.
The Court of Appeal held, reversing those decisions, that where, in situations to which R.S.C. Order 22 rule 3 applies and a payment into court is accepted:
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1. There is no judgment or order within section 17 or section 18 of the Judgments Act 1838; accordingly there is no judgment debt and thus no entitlement to interest;
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2. Since R.S.C. Order 22 rule 3(4) imposes an automatic stay on all further proceedings where a payment into court is accepted, no application to the court for an order for costs can be made; and
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3. Interest on costs only accrues if those costs are not paid within 4 days after taxation, the party entitled to those costs avails himself of R.S.C. Order 45 rule 15 and signs judgment for them. However, in such a case interest will only accrue from the date of such judgment.
This litigation arises out of a road traffic accident which occurred on 18 September 1984. John Edward Woodley was injured in that accident and he was granted legal aid in proceedings in the High Court. Liability appears never seriously to have been an issue. Following an interim payment of £5,085 and a payment into court of £7,500 on 10 May 1988, a further payment of £22,915 was paid into court on 31 May 1988. On 20 June 1988 Mr. Woodley pursuant to R.S.C. Order 22 rule 3(1) gave notice that he accepted the resultant sum of £35,500 in satisfaction of his cause of action. On 19 October 1988 and 20 January 1989 taxation of the costs was carried out by Mr. District Registrar Donaldson. Between these two dates, viz. on 3 November 1988, your Lordships gave judgment in the case of Hunt v. R. M. Douglas (Roofing) Ltd. [1990] 1 A.C. 398, holding that interest on costs runs from the date of the order (the "incipitur rule") and not, as had previously been held, from the date of the completion of the taxation (the "allocatur rule"). In reliance upon that decision, it was argued on behalf of Mr. Woodley that he was entitled to interest on his costs as from the date of the acceptance of the payment in, which contention was accepted by both the District Registrar and subsequently on appeal by His Honour Judge Dobry Q.C.
The respondent served notice of appeal to the Court of Appeal. However, Mr. Woodley had little or no interest in the point, since the benefit of any interest recovered on his costs would go to the Legal Aid Fund (see Legal Aid Act 1988 section 6(3)(b) and section 16(5)). There are a very large number of cases every year in which legally aided plaintiffs accept payments into court. It would therefore be greatly to the advantage to the Legal Aid Fund if interest should be held to accrue on costs from the moment at which the payment in is accepted. Accordingly an application was made on behalf of the Legal Aid Board to the Registrar of Civil Appeals for an order substituting the Board for Mr. Woodley as respondent to the appeal. Such an order was duly made and thereafter Mr. Woodley took no part in the proceedings either in the Court of Appeal, or in the proceedings before your Lordships' House. This was accepted on all sides as an entirely satisfactory situation.
The material parts of sections 17 and 18 of the Judgments Act 1838 read as follows (the rate of interest has of course been amended):
"17 … every Judgment Debt shall carry interest at the Rate of £4 per Centum per Annum from the Time of entering up the Judgment … until the same shall be satisfied, and such Interest may be levied under a writ of Execution on such Judgment." The statutory rate of interest has been increased from time to time.
18 … all Decrees and Orders of Courts of Equity, and all Rules of Courts of Common Law … whereby any Sum of Money, or any Costs, Charges, or Expenses, shall be payable to any Person, shall have the Effect of Judgments in the Superior Courts of Common Law, and the Persons to whom any such Monies, or Costs, Charges, or Expences, shall be payable, shall be deemed Judgment Creditors within the meaning of this Act; and all Powers hereby given to the Judges of the Superior Courts of Common Law with respect to Matters depending in the same Courts shall and may be exercised by Courts of Equity with respect to Matters therein depending … and all Remedies hereby given to Judgment Creditors are in like Manner given to Persons to whom any Monies, or Costs, Charges, or Expenses, are by such Orders or Rules respectively directed to be paid …"
These sections were extensively considered by your Lordships in Hunt's case, but in that case it was common ground between the parties and accepted by your Lordships that an order of the court had been made. It therefore carried...
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