WILLIAMS v SECRETARY OF STATE FOR BUSINESS, ENERGY & INDUSTRIAL STRATEGY (SEE OUR CASE LAW LIBRARY FOR FULL JUDGMENT)
BYPASSING THE PORTAL IN CASES WHICH START WITH MORE THAN ONE DEFENDANT BUT CONCLUDE AGAINST JUST ONE :-
Summary :
The Claimant’s solicitors pursued more than one Defendant in a claim for NIHL. They could not proceed via the portal as it does not permit multi-party claims. However, the claim settled against just one party (and dropped against the other) and that party argued that fixed costs should apply as if the matter had proceeded through the portal (arguing that it could and should have proceeded that way).
The Court at first instance agreed with the Defendant and limited the costs to fixed costs. However this was appealed and the higher Court overturned the first instance decision albeit it indicated that whilst there was not any automatic limitation on costs, therefore the assessing costs Judge had discretion to limit the costs to those by reference to the fixed costs rules. The higher Court remitted the matter for a costs assessment. The Defendant then appealed this decision (ostensibly maintaining the opinion that the rules should / could be applied automatically). This was not accepted by the Court of Appeal however, the CoA did agree that ultimately fixed costs should be the allowance albeit via the Part 47.15 process as opposed to an automatic process.
Our comment :
Costs of these appeals and assessment hearings will outweigh the costs of the case. However, it is money well spent by the successful party (in this case the Defendant) as it gives some clarity (not complete clarity I hasten to add) and gives Defendants the upper hand in future cases.
It does however put Claimant’s solicitors in a difficult position when they are faced with having to decide which parties to proceed against. If they and their client genuinely believe that more than 1 Defendant is culpable this case will make them think twice about pursuing both before digging deeper for evidence. Defendants insurers will be grateful of that and arguably it’s fair to expect full evidence to be gathered prior to proceeding but this is not always so easy.
If, as in this case, you have 2 potentially culpable parties, how far must you go to establish culpability before deciding how to proceed ? If you decide that you do not have enough information to formulate a firm decision you will justifiably want to proceed against both. However, if it transpires that one of those Defendants was blame-free after all, the remaining Defendant’s representatives will inevitably say that the claim should have been against just one party and therefore could and should have proceeded via the portal. Essentially that’s what happened here and the Court are using Part 44 misconduct rules to penalise the Claimant in costs.
This case puts all Claimant’s solicitors on notice that they need to be fairly sure of their tortfeasors before deciding to bypass the portal. Most of the time this should be achievable with ease but not so much in NIHL cases.
Inevitably the Court’s will have to apply hindsight when deciding whether the Claimant’s solicitors conduct was reasonable or otherwise when a decision was made as to which parties to pursue. Again, it might be obvious but what happens in cases where culpability apportionment is not so obvious ?
So here are your unenviable options now :
- Bypass the portal and proceed against more than 1 Defendant (in the knowledge that if you later drop the claim against 1 of the Defendants, you’re only going to be able to claim and recover fixed costs unless you can prove that your decision to proceed against both was a reasonable one); or
- Ditch one of your would-be Defendants to avoid the situation in 1 above and put it through the portal.
In either event you will only recover fixed costs.
In the case of example 1 above, how do you draft your bill ? After all, it’s a standard basis assessment and the Court in this case have said that a multi-item bill is unnecessary therefore presumably, you would still have to go via Part 47.15 to recover your fixed costs but it’s unlikely that paying parties will pay the costs of that process. The Court of Appeal have yet to address this as that was not a live point within the appeal but no doubt it will become an issue at some point soon.
…and so it goes on.
Guy Platt-Higgins