Sharp v Leeds City Council  EWCA Civ33
Confirming that the Costs of a Pre-Action Disclosure are limited by the fixed costs regime.
Sharp v Leeds City Council  EWCA Civ33 addresses the cost consequences of a PAD Application when the substantive matter is subject to the fixed costs regime as set out in CPR 45.29.
In the case, the Claimant pursued a claim for damages resulting from a public liability accident. The Claimant tripped over a defective paving slab and as a result suffered injuries for which she held the Defendant responsible.
The accident took place on the 26th February 2014 and as a result was correctly submitted on the Portal pursuant to the EL/PL Protocol. The claim then left the Portal and as such was subject to the Personal Injury Protocol and the fixed costs under CPR 45.29.
One of the specific aims of the Protocol is to ‘encourage the exchange of early and full information about the dispute’. The Defendant failed to comply with their pre-action disclosure obligations and as such the Claimant submitted a PAD Application.
As is often the case, disclosure had been dealt with by the time the Application was put before the Judge so the only outstanding element was the appropriate costs to be awarded.
As per CPR Part 46.1(2) ‘The general rule is that the Court will award the person against whom the order is sought that person’s costs’. The District Judge treated the PAD Application as separate from the fixed costs regime, awarding £1,250.00. This was overturned on Appeal where it was ruled that
‘The fixed costs regime plainly applies to the costs of a PAD Application made by a Claimant who is pursuing a claim for damages for personal injury which began with the issue of a CNF in the Portal’.
Until this decision, Judges had been inconsistently dealing with the costs of PAD Applications in matters which fall under the fixed costs regime, there will now be a universal approach.
In accordance with CPR 45.29H, the costs which will be allowed in PAD applications will amount to one half of the applicable Type A or Type B costs contained in CPR 45.29 (Table 6 or 6A). Plus any recoverable disbursements, likely limited to the court fee, in accordance with CPR 45.29I.
The Judgement does open up a further question; could the decision have any application to the reasonable costs of PAD Applications which take place in matters not subject to the fixed costs regime? My opinion is that the decision should hold little weight in such cases.
‘Could the decision have any application to the reasonable costs of PAD Applications which take place outside the fixed costs regime?’
At paragraphs 31 and 32 of the judgment it is highlighted that the decision is based closely on the intent of the fixed costs regime to limit costs. At paragraph 31 Lord Justice Briggs explains:
“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.”
This reasoning would not apply to cases which are not subject to the fixed costs regime, certainly it would not apply to cases which could not be described as ‘small or relatively modest’.
Further to the above, at paragraph 41 Lord Justice Briggs repeats that the fixed costs regime is designed to avoid incurring disproportionate expense via satellite litigation. The long established notion that fixed costs ‘swing and roundabout’ is referred and the Claimant’s representatives are to take, in the Judge’s words, “the rough with the smooth.”
Despite having little or no direct application to cases pursued outside the fixed costs regime, the repeated references to proportionality within the Judgment should remind all practitioners of the pervasiveness of proportionality given its now equal footing with justice in the overriding objective.
‘The repeated references to proportionality within the Judgment should remind all practitioners of the pervasiveness of proportionality’
The lesson to take from the decision is to keep efficiency of any PAD Application at the forefront of your mind, especially in any case subject to fixed recoverable costs. The level of costs which the decision determines are recoverable in matters subject to fixed costs, is likely to make them an unprofitable albeit necessary step when required.
Whether Defendants will have motivation to assist in achieving this aim is doubtful. Knowing the modest legal costs of the Application, Defendants may be less likely to proactively deal with early disclosure.