Miss Courtney Webb (by Her Litigation Friend Miss Stacey Keira Perkins) (Appellant/Claimant) v Liverpool Women's NHS Foundation Trust (Respondent/Defendant)
Jurisdiction | England & Wales |
Judge | Sir Stanley Burnton,Lord Justice Simon,Lady Justice Gloster |
Judgment Date | 14 April 2016 |
Neutral Citation | [2016] EWCA Civ 365 |
Docket Number | Case No: A2/2015/1317 |
Court | Court of Appeal (Civil Division) |
Date | 14 April 2016 |
[2016] EWCA Civ 365
Lady Justice Gloster
Lord Justice Simon
and
Sir Stanley Burnton
Case No: A2/2015/1317
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
LEEDS DISTRICT REGISTRY
HIS HONOUR JUDGE SAFFMAN sitting as a Judge of the High Court
Royal Courts of Justice
Strand, London, WC2A 2LL
Benjamin Williams QC and Neil Sheldon (instructed by Irwin Mitchell) for the Appellant
Guy Mansfield QC and Sarah Lambert (instructed by Hill Dickinson) for the Respondent
Hearing date: 15 March 2016
Introduction
This is an appeal, with permission of the Judge, from the costs order dated 1 April 2015 made by HH Judge Saffman following his trial of the Appellant's medical negligence claim against the Respondent. It raises an important question as to the powers of the trial judge under CPR Part 36. It is a sad fact that the provisions of Part 36, intended to promote the settlement of litigation, and thus to minimise costs, have themselves been productive of numerous appeals to this Court, and in consequence substantial costs in what is effectively satellite litigation. This is presumably because Part 36 is highly prescriptive (so that even experienced lawyers may fail to make a compliant offer) and the financial consequences of the application of the provisions of Part 36, or the failure to comply with the requirements of Part 36, may be substantial.
I shall refer to the Appellant as the Claimant and the Respondent as the Defendant.
The litigation and the result of the trial
The claim resulted from the Claimant's birth, in the course of which she suffered a Brachial Plexus Injury as a result of shoulder dystocia. She claimed that her injury was the result of the Defendant's negligence. The Claimant's allegations of negligence fell into two main parts:
(a) That, during the labour of the Claimant's mother the need for a Caesarean section was indicated on 4 occasions, but, negligently, no Caesarean section was performed and instead the Defendant negligently decided that the birth should be allowed to proceed to a vaginal delivery (the first allegation).
(b) That the vaginal delivery itself was negligently managed because the midwives undertaking it failed to adopt recognised procedures to deal with the shoulder dystocia that the claimant suffered in the course of the vaginal delivery (the second allegation).
The Judge upheld the first allegation, but rejected the second allegation. Having succeeded in establishing that her injury was caused by the Defendant's negligence, the Claimant was entitled to full recovery of damages for her injury and loss.
On 1 October 2014 the Claimant had made a Part 36 offer to settle liability on the basis that she received 65% of the damages that would accrue on a 100% basis. That was rejected on 9 October. Its effective date ("the effective date") was 23 October 2014.
The judgment was clearly more advantageous to the Claimant than the proposal contained in her Part 36 offer. When judgment was handed down, her counsel contended that the consequences of what was then Part 36.14(3) applied and that she should have all her costs on an indemnity basis from the expiry of the relevant period plus interest thereon at the enhanced "Part 36 rate" plus the enhancements specified in Part 36.14(3)(a) and (d).
The Defendant contended that the normal consequences of Part 36.14(3) should be disapplied because, by reference to Part 36.14(4), in the circumstances it would be unjust to apply them. It argued that Part 36 did not prevent the court from making an issues-based or proportionate costs order to reflect the fact that the Claimant failed in respect of the second allegation, which was a discrete and independent allegation. The Claimant should have her costs with the Part 36 enhancements in respect of her costs referable to the first allegation but she should not be awarded costs for the unsuccessful prosecution of the second allegation, much less with any Part 36 enhancements.
Since the date of the judgment under appeal, there has been a further amendment of Part 36. It does not affect the substance of its provisions so far as applicable to the present appeal, but the numbering of its provisions was altered. References in this judgment are to Part 36 as it was prior to April 2015.
It does not appear from the Judge's costs judgment that there was any separate argument as to the Claimant's costs incurred before the effective date of the Part 36 offer. There was such argument before this Court, and I refer to it below.
In this judgment, I refer to a claimant who after trial has obtained a judgment at least as advantageous to her as the proposals contained in her Part 36 offer as "a successful claimant".
The Judge's costs judgment
In his careful judgment, the Judge held:
a) Part 36 does not prevent the Court from making an issues-based or proportionate costs order. In other words, the Court has a discretion to make such an order, notwithstanding that the Claimant was a successful claimant.
b) In the circumstances of this case, it was just to make an issues-based proportionate costs order, under which the Claimant would not recover her costs of the second allegation.
The order made by the Judge was that the Claimant should recover her damages to be assessed with the 10 per cent addition required by CPR 36.14(3)(d), plus her costs excluding those referable to the second allegation. The Judge therefore excluded from her recovery the fees of her midwifery expert (whose evidence was confined to the second allegation) and 25 per cent of her solicitors' time costs, being his assessment of the solicitors' costs referable to the second allegation. The Claimant's costs, other than the excluded 25 per cent of her solicitors' time costs, incurred after 22 October 2014 were to be assessed on an indemnity basis pursuant to CPR 36.14(3)(d), and the Defendant was ordered to pay interest on those costs incurred after 22 October 2014.
The issues on this appeal
Before us, both parties recognised that there might be different principles applicable to costs incurred before the effective date. Both parties accepted that the Claimant's entitlement to costs before the effective date was to be determined in accordance with the CPR Part 44. In relation to those costs, the Claimant contended that this was not a case in which there was any justification for depriving the successful Claimant of any of her costs. The second allegation had not been made or pursued unreasonably or irresponsibly. Both allegations concerned a single event, namely her birth and its management. It was common, particularly in a relatively complex personal injuries case, for a claimant to succeed on some allegations of negligence and to fail on others, and the mere fact of her failing on a sensibly pursued allegation of negligence did not justify her being deprived of part of her costs.
The Defendant understandably emphasised the advantage of the trial Judge in assessing the conduct of the case, and the well-known authorities stressing that this Court should be reluctant to interfere with the decision of the trial Judge on costs. The appellant in such a case must show that the Judge erred in law or in the application of principle or made an order that, correctly applying the applicable law and principles, he could not have made.
The issues in relation to the Claimant's costs incurred after the effective date are more complex. The Claimant submitted:
a) On the true construction of Part 36, the discretion of the Court under Part 36.14(3) (now 36.17(4)) is restricted to the enhancements to which a successful claimant is normally entitled in respect of damages, costs and interest. For example, the Court may decide that the successful claimant should not recover costs on an indemnity basis, and could restrict her to the standard basis. It would follow that the Court does not have power under Part 36 to deprive a party of part of its costs on the basis that it failed to establish part of its claim. In other words, on its true construction, Part 36 excludes the normal discretion of the Court to make an issues-based or proportionate costs order.
b) Alternatively, a successful Claimant can only be deprived of her costs if it is shown that it would be unjust for her to recover all her costs.
c) The Judge erred in law in deciding that he could and should deprive the Claimant of her costs attributable to the second allegation.
The Defendant contends:
a) The judge was entitled, in the exercise of his discretion under Part 44, to deprive the Claimant of her costs incurred prior to the effective date that relate to the second allegation.
b) In relation to the Claimant's costs incurred after the effective date, on the true construction of Part 36, the costs referred to in 36.14(3)(are the costs that are determined on the application of the discretion under Part 44.2. It is only to those costs that the right to their assessment on the indemnity basis applies. It follows that the judge was entitled to restrict the Claimant's recovery to her costs relating to the first allegation, and to have only those costs assessed on the indemnity basis.
c) In any event, the Judge found that it would be unjust for the Claimant to recover her costs of the second allegation; he was entitled so to find; and accordingly, in the circumstances of this case, he...
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