Wickes Building Supplies Ltd v William Gerarde Blair (No.2) (Costs)
| Jurisdiction | England & Wales |
| Judge | Lord Justice Baker,Lord Justice Holroyde,Lord Justice Hamblen |
| Judgment Date | 21 January 2020 |
| Neutral Citation | [2020] EWCA Civ 17 |
| Docket Number | Case No: B3/2018/2349 |
| Court | Court of Appeal (Civil Division) |
| Date | 21 January 2020 |
[2020] EWCA Civ 17
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM Winchester County Court
HH Judge Iain Hughes QC
DO0AF649
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Hamblen
Lord Justice Holroyde
and
Lord Justice Baker
Case No: B3/2018/2349
Grace Cullen and Paul Hughes (instructed by BLM Solicitors) for the Appellant
Sarah Robson (instructed by Bakers Solicitors) for the Respondent
Approved Judgment
On 12 November 2019, we allowed an appeal by Wickes Building Supplies Ltd (“the appellant”) against the decision of HH Judge Hughes QC to allow an appeal against an order made by District Judge James in proceedings brought by the respondent under the Pre-Action Protocol for Low Value Personal Injury (Employers' Liability and Public Liability) Claims (“the Protocol”).
Following our decision, the appellant applied for an order that the respondent pay the costs of the appeal and of the hearing before the circuit judge. The parties are agreed that the respondent should pay costs but are not agreed as to the appropriate regime, nor as to the extent to which any order for costs may be enforced.
The following issues fall to be determined:
(1) Do the rules governing fixed costs in CPR r.45.17 to 19 apply to the costs of the appeal?
(2) If not, does CPR r.52.19 apply?
(3) If CPR r.52.19 does apply, what order for costs should we make?
(4) Does the Qualified One-Way Costs Shifting regime in CPR Part 44 apply to the costs of the appeal so as to limit the extent to which any order may be enforced against the respondent?
Having identified these issues, we adjourned the application to be determined on the basis of further written submissions from the parties. We received two sets of submissions from each party. For the appellant, the first set were prepared by Ms Cullen who appeared at the hearing of the appeal, and the second by Mr Hughes. For the respondent, both submissions were drafted by Ms Robson. We are very grateful to counsel for their extensive inquiries and submissions on the issues.
The full background to the case is set out in our earlier judgment, reported at [2019] EWCA Civ 1934. In summary, the respondent sustained injuries as a result of an accident at work whilst in the appellant's employment and subsequently submitted a claim to the appellant's insurers under the Protocol. The appellant admitted liability and, after the parties had failed to agree damages under Stage 2 of the Protocol, the respondent filed a claim in the county court under Stage 3, which is set out in Practice Direction 8B. At the hearing, the district judge ordered the appellants to pay £2000 by way of damages to the respondent, plus costs in the sum of £1080.
The respondent filed a notice of appeal on the grounds that the district judge had made a procedural error in allowing the claim to continue under the Protocol after the respondent had served additional evidence. The circuit judge allowed the appeal, holding that the district judge ought to have dismissed the proceedings under the Protocol, leaving the respondent to start fresh proceedings under CPR Part 7. The judge set aside the district judge's order, dismissed the claim under the Protocol, reserved all questions of costs due under the Protocol until the conclusion of the respondent's claim under Part 7, and ordered the appellant to pay the respondent's costs of the appeal. The appellant then appealed the circuit judge's decision to this court. At the conclusion of the appeal hearing before us, we held that the circuit judge had been wrong to conclude that the district judge should have dismissed proceedings under the Protocol. We therefore set aside the circuit judge's order and reinstated the order made by the district judge.
Relevant statutory provisions, rules of court and case law
Under s.51(1) of the Senior Courts Act 1981:
“Subject to the provisions of this or any other enactment and to rules of court, the costs of and incidental to all proceedings in
(a) the civil division of the Court of Appeal
(b) the High Court and
(c) the county court
shall be in the discretion of the court.”
S.51(3) provides that:
“The court shall have full power to determine by whom and to what extent the costs are to be paid.”
CPR Part 44 provides general rules about costs. Section II of Part 44 establishes the regime for Qualified One-Way Costs Shifting (“QOCS”). Rule 44.13(1) provides, so far as relevant to this case:
“This section applies to proceedings which include a claim for damages (a) for personal injuries ….”
Rule 44.14 provides:
“(1) Subject to rules 44.15 and 44.16, orders for costs made against the claimant may be enforced without the permission of the court but only to the extent that the aggregate amount in money terms of such orders does not exceed the aggregate amount in money terms of any orders for damages and interest made in favour of the claimant.
(2) Orders for costs made against the claimant may only be enforced after the proceedings have been concluded and the costs been assessed or agreed.
(3) An order for costs which is enforced only to the extent permitted by paragraph (1) shall not be treated as an unsatisfied or outstanding judgment for the purposes of any court record.”
Rules 44.15 and 44.16 provide exceptions to QOCS, none relevant to this case.
CPR Part 45 sets out rules of court about fixed costs. Section III of Part 45 governs fixed costs in claims brought under the Protocol. CPR r.45.17, so far as relevant to this case, provides that:
“The only costs allowed are
(a) fixed costs in rule 45.18; and
(b) disbursements in accordance with rule 45.19 ….”
CPR Part 52 sets out rules governing appeals to the civil division of the Court of Appeal, the High Court and the county court. Rule 52.19 (previously rule 52.9A) provides:
“(1) Subject to rule 52.19A [not relevant to this case], in any proceedings in which costs recovery is normally limited or excluded at first instance, an appeal court may make an order that the recoverable costs of an appeal will be limited to the extent which the court specifies.
(2) In making such an order the court will have regard to
(a) the means of both parties;
(b) all the circumstances of the case; and
(c) the need to facilitate access to justice.
(3) If the appeal raises an issue of principle or practice upon which substantial sums may turn, it may not be appropriate to make an order under paragraph (1).
(4) An application for such an order must be made as soon as practicable and will be determined without a hearing unless the court orders otherwise.”
CPR Part 45 Section III or CPR 52.19?
On behalf of the respondent, Ms Robson submitted that this claim was and had always been a claim under the Protocol and therefore the Part 45 Section III regime applied. She contended that, as the Court of Appeal's discretionary powers to award costs under s.51 of the Senior Courts Act are expressed as being subject to rules of court, the terms of Part 45 Section III take precedence. The provisions of rules 45.16 to 18 are mandatory – the court may not award anything beyond the fixed costs. In support of this proposition, she cited a passage from the judgment of Briggs LJ (as he then was) in Sharp v Leeds City Council [2017] EWCA Civ 33:
“The starting point is that the plain object and intent of the fixed costs regime in relation to claims of this kind is that, from the moment of entry into the Portal pursuant to the EL/PL Protocol (and, for that matter, the RTA Protocol as well) recovery of the costs of pursuing or defending that claim at all subsequent stages is intended to be limited to the fixed rates of recoverable costs, subject only to a very small category of clearly stated exceptions. To recognise implied exceptions in relation to such claim-related activity and expenditure would be destructive of the clear purpose of the fixed costs regime, which is to pursue the elusive objective of proportionality in the conduct of the small or relatively modest types of claim to which that regime currently applies.”
Ms Robson contrasted the separate fixed costs regimes of both Sections II and IIIA of Part 45, which each include what she described as “escape clauses” permitting the award of costs at a higher level in exceptional circumstances (rules 45.13 and 45.29J respectively), with Section III, which contains no such provision. She cited a number of cases in which this court has stressed the importance of fixed cost regimes while acknowledging that, by favouring certainty, there will occasionally be cases where the outcome may in some respects appear unreasonable: see, for example, Lamont v Burton [2007] EWCA Civ 429 per Dyson LJ at paragraph 26. Ms Robson submitted that, were this court, in awarding the costs of the appeal, to depart from the fixed costs regime in Section III of Part 45, it would undermine certainty and encourage satellite litigation with parties inventing more and more ingenious ideas to circumvent the regime.
On behalf of the appellant, Ms Cullen submitted that the fixed costs regime under Section III of Part 45 does not cover appeals. The costs of an appeal are entirely separate from any fixed costs regime and are dealt with separately under Part 52. An appeal to this court will involve drafting grounds of appeal and a skeleton argument containing legal submissions. The documents filed will comply with the procedural rules governing appeals. The hearing of the appeal will be of a wholly different character. The process is completely different from that set out in Stage 3 of the Protocol in Practice Direction 8B. The fixed costs regime simply does not apply. Ms Cullen pointed out that, following his successful appeal at the hearing before the...
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Richard Achille v Lawn Tennis Association Services Ltd
...But the QOCS regime does apply to appeals as well as to proceedings at first instance ( Blair v Wickes Building Supplies Ltd (No. 2) [2020] EWCA Civ 17, [2020] 1 WLR 1246). There is no need in this context to qualify the natural meaning of the term, because the cost protection which a cla......