Malone v Birmingham Community NHS Trust [2018] EWCA Civ 1376
Wrongly named Defendants in CFAs is a recurring issue with various non-binding and conflicting decisions on the issue including Brierley v Prescott [2006] EWHC 90062 (Costs), Law v Liverpool City Council [2005] EWHC 90020 (Costs), Scott v Transport for London (2009) (unreported) and Brookes v DC Leisure Management Ltd & Anor [2013] EW Misc 17 (CC).
The case of Malone v Birmingham Community NHS Trust [2018] EWCA Civ 1376 is yet another example, but one with a surprising conclusion.
The Claimant was a prisoner in HMP Birmingham. The Claimant became unwell and after a series of appointments with medical professionals, eventually it became apparent that the Claimant was suffering from testicular cancer.
Shortly after, the Claimant commenced an action alleging there was a negligent failure to diagnose that he had cancer. Proceedings progressed and the case settled in the sum of £10,000.00.
Following settlement, the detailed assessment process was commenced. During the course of discussions, the Defendant argued that no costs were payable to the Claimant as the only Defendant specified in the CFA was the Home Office, thus limiting the CFA to a claim against the Home Office/Ministry of Justice. It did not cover an action against Birmingham Community NHS Trust, the relevant Defendant.
To be precise, the CFA stipulated that the agreement covered all work that was
‘conducted on your behalf following your instructions provided on [sic] regarding your claim against Home Office for damages’.
The Defendant further asserted that the CFA therefore made a clear indication as to the specific Defendant. It followed therefore that the court should not interpret the CFA to apply to a claim against any other Defendant.
In a judgment dated 27 April 2015 District Judge Phillips, the regional costs judge for Wales, held that as a matter of construction, the CFA excluded a claim against the Defendant. Consequently, he held that no costs were recoverable as the Claimant had no contractual liability to his solicitors for the work done in bringing the claim against Birmingham Community NHS Trust.
The matter proceeded to the Court of Appeal. Tasked with lead for the appeal judgment, Lord Justice Hamblen said that whilst the CFA demonstrated ‘poor quality drafting and little attention to detail’, including leaving out the date of instructions and the description of the claim, the construction of the CFA should be put in context and was consistent with being ‘descriptive rather than prescriptive’.
Lord Justice Hamblen added:
‘If the intention had been to define and limit the coverage of the CFA to claims against a particular Defendant, greater care and precision would be expected and, in particular, one would not expect the named Defendant to be an entity which was obviously inappropriate.’
Lord Justice Hamblen thereafter pointed out that the CFA was entered into at an early stage prior to proceedings being issued, and it was in neither party’s interest to seek to impose strict definitional limits.
The Court concluded that the CFA was not to be considered as being limited to a claim against the Defendant specified in the CFA, and allowed the Claimant’s appeal.
This makes a very interesting read as until now cost lawyers were advising clients when not clear as to the identity of a Defendant to simply not name a Defendant in the CFA, but rather to identify the incident by reference to the date or type of accident. Until now, cost practitioners took the view that expressly naming one party as Defendant in a CFA limited the scope of what the agreement covered.
No need to fret anymore, says Lord Justice Hamblen.