Harmans Costs Brief - October 2016

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Welcome to the October issue of Costs Brief. We're now busy preparing for our Autumn seminar at The Law Society in London at the end of November, date to be confirmed shortly. Invitations will be sent out very soon but please get in touch now if you'd like to request a space by emailing our Marketing Manager Vikki Knight.

We've also covered the latest industry news including a costs update from Partner Gary Knight as well as a look at the circumstances in which a CFA can be assigned, a subject we are frequently asked about by our clients.

We hope you find this latest instalment of Costs Brief useful.

Many thanks, Harmans Costs
For even more news and comment visit our website
Costs Law Update by Partner & Costs Lawyer Gary Knight
Lowin v W Portsmouth & Co LTD [2016] EWHC 2301 QBD Elisabeth Laing J - 20/06/16

An appeal against a decision of a Costs Judge following a provisional assessment of the receiving party’s costs.

The Claimant was entitled to costs following a successful claim for damages arising from the death of the Claimant’s mother as a result of malignant mesothelioma. Damages were recovered in October 2014 in the sum of £70,200.

The Claimant made a Part 36 offer in respect of costs for £32,000. Absent acceptance the matter proceeded to a provisional assessment in respect of the Bill of Costs which sought in excess of £55,000.

The provisional assessment undertaken on 8 February 2016 resulted in the allowance of costs in the sum of £32,255.35 and the Costs Judge ordered that pursuant to the provisions of CPR 36.17(4) the Defendant was to pay interest on costs at a rate of 10% per annum for the period 21 days from the Claimant’s Part 36 offer plus costs of the assessment to be summarily assessed on the indemnity basis with interest on those costs at 10%.

The Claimant produced a statement of costs for the assessment amounting to £6,091.20, the Costs Judge assessed the same at £2,805.

In giving reasons for his decision the Master considered that whilst an assessment of the Claimant’s costs could properly be undertaken pursuant to Part 36.17(4) (c) this did not “dislodge the effect of CPR 47.15(5) which has the effect of trapping the “maximum amount the court would award” to the receiving party to £1,500 plus VAT plus Court fee…”

The Claimant sought leave to appeal, the Costs Judge refused the application referring to Broadhurst v Tan [2016] EWCA Civ 94 and finding, in the view of the Costs Judge, the same to have “no application as there is a contractual difference between “fixed costs” and as here, assessed costs subject to the cap in CPR 47.15(5).”

Notice of Appeal was filed and leave to appeal granted. The Appeal was heard by the Judge with Master Leonard sitting as a Costs Assessor.

Find out if the Appeal was allowed and read about other costs cases here.

Harmans costs seminar - November 2016, The Law Society, London
The date of our next seminar is being confirmed as we go to press but looks very likely to be late November.

Our last seminar back in May proved to be extremely popular. If you'd like to be one of the first to know about our Autumn seminar please just email our Marketing Manager to make sure you're on our priority list.

As usual, this event will be free and will have a CPD value too.  All will soon be revealed!
In what circumstances can a CFA be assigned? Mat Knight investigates

Three firms of solicitors represented the Claimant in pursing his personal injury claim following an RTA and the matter eventually settled following acceptance of a Part 36 offer in the sum of £3,500.00.

The first firm was Minster Law, who acted between 17 October 2011 and 14 November 2012 under the terms of a CFA dated 19 October 2011. The second firm was TLW Solicitors (“TLW”), who acted for the Claimant between 16 November 2012 and 23 July 2014. TLW acted under a CFA dated 17 January 2013 (“the TLW CFA”), the terms of which provided for it to have retrospective effect to the date of initial instructions.

The third and final firm was Russell Worth Ltd, to which firm the TLW CFA was assigned on 23 July 2014. The CFA was assigned as TLW were unable to provide the Claimant with the same quality of service as before due to key staff being on maternity leave and securing a new contract; therefore, TLW advised the Claimant to transfer his case to Russell Worth Ltd who specialise in these types of cases.  

The Defendant took issue with the validity of the July 2014 assignment and, in consequence, with the Claimant’s right to recover any costs under the TLW CFA. 

The first key issue was whether the Claimant’s retainer with his solicitors had been terminated by them at the time of the assignment arrangement entered into on 23 July 2014. The second was whether it was possible lawfully to assign the TLW CFA in the manner attempted by the Claimant. The third was whether (assuming that lawful assignment was possible) such assignment was effective.

These key issues considered and a summary here.
New Bill of Costs set to become compulsory from October 2017

The new format bill of costs is set to become compulsory in a year’s time after the rule committee decoupled it from mandatory use of the J-Codes.

The revised practice direction 51L – in force from 3 October in the latest update to the CPR – said the voluntary pilot has been extended for a further year and changes made “with a view to establishing a mandatory form of bill of costs to apply to all work done after 1 October 2017”.

It added that the Civil Procedure Rule Committee will monitor and review the pilot scheme and aim to fix the mandatory form of the new bill of costs at its meeting in May 2017.

Changes to appeals
On 3 October a number of changes to appeals came into force. The changes are intended to lighten the load on the Court of Appeal and are summarised below:
  • the introduction of a new CPR 52 (the main part of the Civil Procedure Rules on appeals)
  • amendments to CPR PD 52C (on appeals to the Court of Appeal) to make that Practice Direction more user friendly and reduce paperwork before the Court of Appeal
  • a new destination of appeals order along with an amended CPR PD 52A removing the exceptions by which appeals from certain final decisions in the County Court would lie to the Court of Appeal

Lord Dyson returns to 39 Essex Chambers after retiring as Master of the Rolls

Lord Dyson has returned to 39 Essex Chambers following his retirement as master of the Rolls.

A 30 year judicial career culminated in Lord Dyson being appointed MR and the Head of Civil Justice in 2012. He had previously been appointed as a judge of the High Court of Justice in 1993 and a Lord justice of Appeal in 2001. He was appointed as a Justice of the Supreme Court in 2010.

Prior to becoming a judge, Lord Dyson was called to the Bar in 1968, appointed Queen's Counsel in 1982 and in 1986 joined 39 Essex Chambers as Head of Chambers.
Read more

IPT Standard Rate increased to 10%

The rate of IPT paid on insurance premiums, which are taxed at the standard rate, increased by 0.5% as from 1 October 2016.

This measure is intended to help the government fund "flood defences and resilience."

This measure was announced at the Budget in March 2016.

The new standard rate of IPT is now 10% and will be due on insurance premiums treated by the legislation as received on or after 1 October 2016, except where insurers operate a special accounting scheme.
Read more
We really enjoyed our first time exhibiting at the APIL clinical negligence conference at The Celtic Manor in Newport at the end of last month. It was nice to see so many faces at our stand - old and new. The lucky winner of our champagne draw was Natalie Pearce of Wolferstans Solicitors!


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