the personal injury and medical law teams’ case law and
TRANSCRIPT
January 2014
The Personal Injury and Medical Law Teams’ Case Law and Practice Update
AA (by his mother and litigation friend
BB) v (1) CC (2) MIB [2013] EWHC 3679
(QB) Swift J.
− PPO for Court of Protection costs − Damages (Variation of Periodical
Payments) Order 2005 − Possibility of C regaining capacity − Uncertain commencement and
termination dates of PPOs − Power of the court to approve
Tomlin Order C, age 28, lacked capacity and a deputy was to be
appointed by the Court of Protection to manage
his affairs.
The court approved settlement of his claim which
comprised payment by the MIB of a substantial
lump sum and periodical payments of £11.500
per annum in respect of future costs of the Court
of Protection and other associated expenses. C
however was expected to regain capacity to
manage his finances, in which event the parties
agreed that those payments would then cease
but would re-commence if he subsequently lost
capacity at a future date.
C submitted:
i) when construing the rules for periodical
payments under the Damages Act 1996 (ss 2,
2A and 2B) and the requirements of CPR
r.41.8(a) to specify the annual amount of a
periodical payment and at what intervals this
would be paid, “intervals” did not merely
refer to frequency of payments but could be
construed as meaning an interval during
which a claimant lacked capacity; as such a
“stop/start” form of periodical payments
could be awarded [paragraphs 9 - 12]
ii) that if such an order was outwith the powers
of the CPR Rules Committee as conferred by
s.2A of the DA 1996, the court should declare
the rule as drafted ultra vires and make a
different order under s.2A
iii) the proposed order under the settlement was
within the Damages (Variation of Periodical
Payments) Order 2005 but no application
would need to be made to the court for
variation as this would follow automatically
once the Court of Protection amended the
status of C’s capacity.
Held: C’s proposals rejected under CPR 41 and
the 2005 Order but Settlement Order approved in
a Tomlin form:
1. Read within the context of r.41.8(1)(a), the
word “intervals” plainly referred to the
intervals of time within the period of a year
at which each periodical payment would be
made. The drafter was not referring to
intervals of years or intervals between
changes in the amount of payments to be
made. The provision of r.41 did not therefore
enable a court to make orders starting and
ending on a date which was uncertain and
Swift J was sceptical of C’s counsel’s
suggestion that under r.41.8 there could be a
total suspension of an order as opposed to a
(Continued on page 2)
January 2013
Capacity and PPOs
7. Further, since the proposed periodical
payments formed part of an agreement
approved by the court, the periodical
payments made under it would be exempt
from taxation [paragraphs 24 to 25]
Comment: This case exemplifies the limitations
imposed by the codification of the Periodcial
Payments scheme which were clearly set out and
recognised by Mrs Justice Swift. The Periodical
Payments Scheme implemented under the
Damages Act 1996 and the 2005 Order,
anticipated continuous periodical payments
without interruption where the interval related to
the regularity of payments, not when or if these
were to be made on some indeterminate
occasion or occasions in the future.
When the 2005 Order was implemented, criticism
was made of the arbitrary (as perceived by some)
restriction to one application for variation over a
claimant’s lifetime. This implementation
coincided with coming into force of the Mental
Capacity Act 2005 introducing greater latitude in
definition of ‘capacity’. Since then, it is possible
to have capacity in some areas (such as
authorising payment of school fees for a
dependant) but not in others such as possessing
appropriate understanding to manage finance in a
broader context especially where a significant
fund of money is involved.
Counsel for D acknowledged that this was a case
which is very different from that envisaged by
CPR 41 which anticipated the court making an
order in the face of opposition from one party
(possibly even both parties) but not dealing with
an agreed order placed before it for approval as
in the index case.
There was recognition of the increased number of
agreements embodied in a Tomlin order, where
the Schedule contains terms that the court could
not of itself order. Provided that the court was
satisfied as to the taxation position, as well as the
continuity of payment and about any other
matters that directly affect the interests of the
claimant, it could approve the order.
The situation that arose in this case, is likely to
recur and while Mrs Justice Swift’s decision is a
model of equitable resolution and benign
casuistry, it does highlight the difficulties posed in
(Continued on page 3)
reduction or an increase as referred to under
r.41.8(3) [paragraph 16]
2. The court was therefore not satisfied that it
had the power to order periodical payments
in the form suggested [paragraphs 14 - 16]
3. The ultra vires argument had not been
developed and the court had insufficient
material before it to make what would be “a
far reaching finding” [paragraph 17]
4. The 2005 Order gave the court power to
provide, in an order, for periodical payments
to be varied where there was a chance that
at some definite or indefinite time in the
future C would, as a result of an act/omission
giving rise to the cause of action, suffer some
serious deterioration or enjoy some
significant improvement in his condition. The
circumstance for which it was intended to
cater was a case where there was to be a
reduction of or an increase in the amount of
periodical payments rather than a “stop/
start” change. It was intended for the sort of
case where it was necessary for there to be
re-assessment of damages in the future.
5. It is undoubtedly possible within the
framework of the 2005 Order to dispense
with the need for an application to vary but it
would not be open to the court to dispense
entirely with the need for an application to
the court. Article 7 of the Order therefore
presents “a serious problem” since it
provides that a party could only make one
application to vary in respect of each
specified disease or type of deterioration or
improvement. For both these reasons it was
not appropriate to make such an order
[paragraphs 18 - 21].
6. The parties could however agree a Tomlin
order with a schedule embodying their
agreement in relation to the periodical
payments. If it was in C’s interests, as it
plainly was, and if it satisfied the
requirements for C’s protection, the court
was not precluded from approving the order,
notwithstanding that it was one which the
court could not itself make under r.41.8 or
the 2005 Order.
(Continued from page 1)
Capacity and PPOs continued
January 2014 Page 2
a strict interpretation of the provisions of r.41 -
and r.41.8 in particular - as well as Order 2005.
The time has come for a review of the Periodical
Payments framework to meet the modern
demands of serious PI damages awards and the
encouragement by courts and a government for
PPOs to be used not only in respect of care claims
but also more creatively for other areas of future
loss including accommodation and loss of
earnings claims. [Deirdre Goodwin]
Coles v Hetherton & Ors [2013] EWCA Civ
1704 [Moore-Bick, Aikens and Vos LJJ]
− Credit Hire
− Measure of Loss
− Reasonableness of hire charge
− Recoverable amount
− Courtesy car costs
The Claimants had chosen to have their motor
vehicles repaired under their Royal & Sun
Alliance’s repair scheme following minor road
traffic accidents. RSA provided for the
policyholder to choose RSA's system for repairing
cars, which entitled the policyholder to the use of
a courtesy car, or to choose another repairer. The
Claimants had opted to use RSA's system, which
involved the repairs being undertaken by a
company (M) which was a member of the same
group of companies as RSA. M owned and
operated a number of repair garages or sub-
contracted repair work to independent garages
outside the group.
The Defendants challenged RSA's repair system
submitting that it increased the overall cost of
repairs to be borne by the Defendants. What RSA
presented to the negligent driver's insurer as the
basis of claim was a breakdown of invoice charges
setting out the figures payable by RSA to M,
which in most cases exceeded the sums paid by M
to the sub-contractors. The Defendants calculated
that the overall effect of this was to increase costs
by about 25%. RSA maintained that fees charged
by M to it were no more than any individual
(Continued from page 2)
policyholder would have had to pay to a garage
and in most cases were somewhat less, because
of the discount which M could obtain by virtue of
its bargaining power and the volume of work
produced by it.
The High Court (Commercial) was asked to
consider the following questions:
i) Measure of loss: Where a vehicle is
negligently damaged and is reasonably
repaired (rather than written off), is the
measure of the claimant’s loss taken as the
reasonable cost of repair?
(ii) Test of “reasonable repair charge”: If a
claimant’s insurer has arranged repair, is the
reasonableness of the repair charge to be
judged by reference to:
a) what a person in the position of the
claimant could obtain on the open
market; or
b) what his or her insurer could obtain
on the open market?
Judgment 1
Mr Justice Cooke (2012) EWHC 1599 (Comm)
held:
(i) Measure of Loss: Where a vehicle is
damaged the correct measure of damages is
the diminution in value of the chattel, which
is taken to be the reasonable cost of repairs.
The reasonable cost of repairs is not
necessarily the repair cost actually incurred
and can be proved by any evidence, not
limited to invoices, which can properly
discharge the burden of establishing the
relevant amount.
(ii) The reasonableness of the repair charge:
Measure of the diminution in the value of the
damaged car was to be assessed by reference
to the position of the individual claimant,
without reference to his insurers or to any
benefits which he obtained under his
insurance policy. As a matter of principle, the
loss was suffered by the policyholder and
that loss was suffered at the outset when the
collision occurred, before any decision was
made about repair, whether by the Claimant
or by RSA or M. The Defendants’ argument
fused the insurer and the insured long before
(Continued on page 4)
Capacity and PPOs continued
January 2014 Page 3
Credit Hire
could not benefit from this benefit that was
available to the Claimant by dint of his having
paid the insurance premiums.
The Defendants appealed to the Court of Appeal
against all four findings of the judge.
Held: dismissing the appeal
1. Measure of Loss: Mr Justice Cooke was
correct in his analysis. Where a vehicle is
damaged the correct measure of damages is
the diminution in value of the chattel, which
is taken to be the reasonable cost of repairs.
The correct jurisprudential analysis of a claim
for diminution in value even if measured by
the reasonable cost of repairs, is that it is a
claim for general damages not special
damages. Questions of mitigation therefore
do not apply (the remarks to the contrary in
Darbishire v Warran (1963) 1 WLR 1067 were
an “aberration” as described by Cooke J).
The reasonable cost of repairs is not
necessarily the repair cost actually incurred
and can be proved by any evidence, not
limited to invoices, which can properly
discharge the burden of establishing the
relevant amount. If a claimant decides to
have his vehicle repaired at a cost which is
not reasonable then the reason why he
cannot recover that unreasonable cost as
damages is because it does not represent the
diminution in value of the chattel. The
diminution in value will always be a question
of fact for the trial judge.
2. The reasonableness of the repair charge:
This second question arose because of the
subrogated nature of the claims and the use
of the RSA scheme. The first question is
whether there is any difference between an
insured or uninsured chattel. The answer to
this question is no. It is settled law that even
where the loss is settled by an insurer the
cause of action remains in the insured unless
specifically assigned to the insurer. Secondly
benefits from an insurance policy are
irrelevant in assessing the correct measure of
damages recoverable. The Defendants would
have to take the present cases out of these
general rules to succeed. The Defendants
argued that the insurer was the claimants’
(Continued on page 5)
the insurer was involved. The repair costs
incurred were simply part and parcel of the
arrangements made by RSA as insurer to fulfil
its obligation to indemnify the Claimant by
reinstatement of the vehicles. The principles
set out in the authorities meant that the
Claimants’ dealings with RSA and RSA's
actions in relation to the indemnity granted
were res inter alios acta, in the context of
assessment of diminution in market value or
costs of repair, and "behind the curtain" for
any tortfeasor who sought to argue about
mitigation of loss in payment of repair costs,
Bee v Jenson [2007] EWCA Civ 923, [2007] 4
All E.R. 791 followed and Copley v Lawn
[2009] EWCA Civ 580, [2010] Bus. L.R. 83 and
W v Veolia Environmental Services (UK) Plc
[2011] EWHC 2020 (QB), [2012] 1 All E.R.
(Comm) 667 considered.
Judgment 2
In Judgment 1, Mr Justice Cooke was asked to
refrain from passing judgment on a third issue
namely:
Recoverable amount: Where a vehicle is not a
write-off and an insurer indemnifies the insured
by having repairs performed and paying charges
for those repairs, and where the amount claimed
is no more than the reasonable cost of repair (on
the correct legal test determined under (2)
above), is that amount recoverable?
At a subsequent hearing to determine whether to
strike out/give summary judgment on various
parts of the Defendant’s defences ((2012) EWHC
2848 (Comm) (“Judgment 2”) Mr Justice Cooke
held:
(i) the answer to the third question was yes. The
overall figure for repairs was what the court
was concerned with and whether this
reflected the reasonable cost of repair. It was
not concerned with the individual charges
which made up the total.
(ii) In relation to a subsidiary point about the
recoverability of a courtesy vehicle which was
supplied free of charge as an adjunct to the
RSA scheme, the judge found that this was
recoverable because it was a fruit of the
contract of insurance and the Defendant
(Continued from page 3)
A Credit Hire continued
January 2014 Page 4
Credit Hire continued
agent but that was not borne out by the
facts. There was no agency relationship
created by the insurance contract. They also
argued that in certain circumstances the
court does take into account the position of
the insurer for example in the case of Copley
v Lawn (2009) EWCA Civ 580. However
Copley did not change the basic principles
above and simply recognised that where a
claimant receives an offer to make amends
then a claimant should be credited with the
advice he could have been expected to
obtain from professionals. Mr Justice Cooke
was right to find that the reasonableness of
the repair charge is to be judged by reference
to what a person in the position of the
claimant could obtain on the open market.
3. Recoverable Amount: If a claimant claims
that the reasonable cost of repairs is that
which the insurer has arranged and paid for,
the court has only to consider whether this
actual sum claimed is equal to or less than
the notional sum this claimant would have
paid if he had the repairs done on the open
market. To do so it needs to consider what
the components of the overall notional figure
would be, stripped of an unreasonable
components and then compare that sum
with the total sum representing the actual
cost to the insurer i.e. the sum claimed by the
claimant. The court will not thereby have to
examine the details of administrative charges
or sundry service charges. The question is
whether the overall cost charged by the
insurers repair scheme is reasonable.
4. Courtesy Car Costs: It was common ground
that if a claimant is deprived of his chattel for
a time, he can recover a sum by way of
general damages for that deprivation. Where
a claimant hires a vehicle on a credit hire
basis, this can be recovered as damages.
Likewise, if under his insurance policy a
claimant is entitled to a courtesy vehicle, he
is entitled to claim general damages for the
deprivation of his own vehicle to be held for
the benefit of his insurer. In practice the
amount of these general damages will be the
(Continued from page 4)
January 2014 Page 5
sum it would have cost the claimant to hire
(on non-credit terms) a comparable vehicle.
Comment: Stuart Nicol commented on Judgment
1 in the July 2013 edition of PIMLU. He described
Cooke J’s decision as “hugely controversial”. He
noted that, “Defendant insurers are rightly
concerned that this will lead to inflated claims
resulting in higher insurance premiums”. He
concluded that there would be an appeal, This
appeal, however, clearly has not been favourable
to the Defendant insurers because the decision of
Cooke J has in effect been upheld in full.
Defendant insurers will be forced to instruct
independent assessors where repair costs are
considered to be inflated which will add further
costs to such claims. Alternatively more
Defendant insurers may be persuaded to offer
their own preferred repairers and vehicle
providers where possible to avoid such arguments
and costs. [Murray Grant]
BMG (Mansfield) Ltd v Galliford Try
Construction Ltd & Aedis Architects Ltd
[2013] EWHC 3183 (TCC) HH Judge
Edwards-Stuart
− Instruction of experts
− Legal advice and litigation privilege
− Expert shopping
− Extent of disclosure required
In a construction case, C sought damages from
D1, the design and build contractor and the D2
firm of architects in connection with the cause of
a fire in a shopping centre, which had occurred in
2004. C's case was that the damage was much
more extensive than it should have been owing to
inadequate fire protection in the roof space and
eaves canopies.
C instructed an expert architect (S) in his early
60’s who reported in 2005. The case proceeded
slowly with an unsuccessful mediation following
meetings of the respective parties’ experts,
including S in 2012.
(Continued on page 6)
Experts - Legal Privilege
Experts - Legal Professional Privilege continued
C sought a second opinion as to the correctness
of S’s advice and following his 70th birthday, S
retired and withdrew from the case.
D refused to agree the appointment of a new
expert witness, finding the timing suspicious,
occurring as it did after a bruising experts
meeting and a failed mediation.
D argued that C had waited until they found
another more favourable expert and that the
request for a new expert, shortly after a failed
mediation, amounted to “expert shopping”. As a
condition of permission to call a new expert, D
required disclosure of any documents in which
the retiring expert had expressed an opinion. The
application extended to disclosure of solicitors’
notes made during discussions with experts.
Held: Application refused:
1. There was no evidence before the court from
S so it was not possible to say whether his
wish to retire was driven by his age or by the
possibility that he had had a bruising time at
the experts' meeting and/or the mediation.
On the face of it, there was nothing
unreasonable about an expert of his age
wishing to be relieved of his duties in
litigation which might have been expected to
have been concluded some years earlier
(paragraphs 15, 19, 35-36 of judgment).
2. C did not require permission to call a new
expert because no party had yet applied for
permission to call any expert. The instant
application therefore pre-empted the
application that would inevitably be made at
the first case management conference under
CPR r.46.4(1) (paragraphs 16-18, 22).
3. Imposing a condition of disclosure of any
previous reports ought to be the usual
practice where the change of expert came
after the pre-action protocol procedure had
started. That principle applied to all reports,
not only those prepared for use in
litigation, Edwards-Tubb v JD Wetherspoon
Plc [2011] EWCA Civ 136, [2011] 1 W.L.R.
13732 and Vasiliou v Hajigeorgiou [2005]
EWCA Civ 236, [2005] 1 W.L.R. 2195 applied.
(Continued from page 5)
January 2014 Page 6
4. The court was not limited to ordering
disclosure of an expert's "final" report; its
powers extended to ordering disclosure of
other reports containing the substance of the
expert's opinion. In the instant case, it was
appropriate to order disclosure of any report
prepared by S in which he expressed opinions
or indicated the substance of such opinions.
5. The court was not, however, prepared to
order disclosure of documentation falling
short of a report, such as C's solicitors'
attendance notes of telephone conversations
with experts which might record expert
opinion. As well as being privileged, such
notes might not recite the expert's actual
words; also they might contain material
which was not expert opinion and redaction
would not always be an effective solution.
Difficulties might also arise if the expert did
not agree that the attendance note correctly
recorded what he had said.
6. There had therefore to be a very strong case
of expert shopping to justify a condition that
solicitors' attendance notes should be
disclosed, otherwise there would be a
significant and unjustified invasion of
privilege and a considerable increase in
litigation costs.
7. The instant case was nothing approaching a
strong case. At best there might be an
appearance of expert shopping, but any such
appearance was faint. There was no evidence
that the second expert had been approached
before S indicated his resignation and the
court was not prepared to draw such an
inference.
8. The need to change experts at such a late
stage was justified and not, as was alleged, a
case of seeking a different opinion, though it
was commented that a statement should
have been obtained from the outgoing expert
explaining his decision to step down. It could
not however be assumed that the absence of
a witness statement was the result of a
tactical decision by C.
“I appreciate that the policy of imposing a
condition requiring disclosure of a previous
expert’s reports is to deter the practice of
(Continued on page 7)
Experts - Legal Professional Privilege continued
‘expert shopping’, but it seems to me that
there has to have been ‘expert shopping’ or
at least a very strong appearance of it, before
disclosure of the type sought on this
application should be ordered.”
(paragraphs 23-25, 28-38)
Comment: Legal advice privilege and litigation
privilege entitle a party to withhold disclosure of
documents or communications with legal advisers
provided these are created for the express
purposes of seeking or obtaining legal advice
when litigation is contemplated or once this has
begun. These are well-established principles but
checks and balances are required to ensure that
legal professional privilege is not used as a cloak
to withhold documents that may be detrimental
to the party’s case.
Efforts have frequently been made to erode this
privilege with a qualified measure of success: in
Edwards-Tubb v J D Wetherspoon [2011] EWCA
Civ 136 it was held that it was within the Court’s
discretion to require one party to waive privilege
of a previous expert’s report before allowing
them to adduce evidence from a new expert.
BMG would appear to have taken this further and
it is now suggested, albeit obiter, that in cases
where there is very strong evidence of “expert
shopping” attendance notes of discussions
between solicitors and experts may be disclosed
to the court.
These two authorities are a valuable reminder
regarding communications with experts, and that
any such communications must be treated as
potentially disclosable and therefore approached
with care.
It is of note that the costs of instructing the new
expert were not recoverable.
Whether acting for claimants or defendants, the
suggestion that in some circumstances (although
not on the facts of the instant case) a party may
have access to Attendance Notes and emails,
must be a worrying concern as it strikes at the
fundamental basis of trust between lawyer and
client. [Deirdre Goodwin]
(Continued from page 6)
January 2014 Page 7
Nemeti and ors v Sabre Insurance Ltd
[2013] EWCA Civ 1555 [Sir Terence
Etherton (Chancellor); Hallett & Sharp LJJ]
− No substitution out of time after bad claim against insurers
In 2007 a road traffic accident occurred in
Romania. The Claimants (Cs), all Romanian
nationals, were passengers in a vehicle driven by
B, who had borrowed his father's car. His father
was insured by Sabre (S). Claims were brought, in
time under Romanian law, directly against S
under Regulation 3 of the European Communities
(Rights Against Insurers) Regulations 2002. The
Regs allow a claim such that an insurer becomes
directly liable “to the entitled party to the extent
that he is liable to the insured person”.
S supplied to strike out the claims: B was not the
insured person, and the accident occurred
outside of the UK. Realising their mistake, and
not being able to bring a fresh claim against the
Estate due to the expiry limitation (which is not
extendable in Romania), Cs' legal advisers applied
to add/substitute B's Estate arguing it would
cause no prejudice to the Estate or S, each of
whom had had ample notice of their possible
liability. They hoped to take advantage of the
“relation back” principle in section 35 of the
Limitation Act 1980 to have the proceedings
against the Estate deemed to have been
commenced on the same day as the proceedings
were issued against S. Thereafter they would rely
on section 151 of the Road Traffic Act 1988 to
oblige S, as insurer of the vehicle, to satisfy any
judgment. In those circumstances the Estate had
not been given notice of the application. The only
amendments required to the original Particulars
of Claim were the deletion of the paragraph in
which reliance was placed on the 2002
Regulations, and the substitution of the Estate for
S as Defendant. The road traffic accident, the
alleged wrongdoing, and the relief sought
(damages for personal injury) all remained the
same.
The matter came before Master Eastman, who
noted all these features and concluded the claims
(Continued on page 8)
Limitation - substitution
Court might sympathise with Master
Eastman's approach. However, this was not a
matter of discretion, but of statutory
construction.
3. Cs' analysis of the original cause of action was
flawed, as it stopped at the negligence of the
driver and the relief sought. A vital element
in the original claim against S was the
application of Regulation 3. The cause of
action was based on the negligence of B, but
was derived from statute. It was effectively a
claim for an indemnity under statute (as the
claim form made clear) limited to S's liability
to their insured. The new claim was a claim
in negligence against the alleged tortfeasor B,
for damages payable by the Estate. There
were two separate causes of action. A
decision had been taken, either for tactical or
financial reasons, not to bring the claim
against the Estate but against the insurer.
The proposed substitution was not therefore
to maintain the original claim, but to found
an entirely new cause of action against a new
party.
Comment: This case reminds us of the four
categories where substitution will be permitted
out of time:
− Category 1: cases of succession.
− Category 2: cases where the Claimant wants
to add a fresh cause of action which arises
out of the same facts or substantially the
same facts as are already in issue on any
claim made in the original action.
− Category 3: cases where it is necessary to
substitute a new party for a party whose
name was given in any claim made in the
original action in mistake for the new party.
− Category 4: cases where any claim already
made in the original action cannot be
maintained by or against an existing party
unless the new party is joined or substituted
as Claimant or Defendant in that action.
In the present case, the only category which could
have been applicable was Category 4, the Court
commenting that while there was plainly a
mistake, it was not one of a type which could be
remedied by substitution (under category 3).
(Continued on page 9)
Limitation - Substitution of Parties continued
advanced against the Estate and the claims as
previously advanced against S were the same
claims in negligence for damages for personal
injury. He therefore allowed the substitution. On
appeal to HHJ Cotter, the decision was reversed
and the claims struck out. Cs appealed to the
Court of Appeal.
They relied upon the application of section 35(5)
(b) of the Limitation Act 1980 which permits
substitution outside of the limitation period in the
case of a claim involving a new party, if the
addition or substitution of the new party is
necessary for the determination of the original
action. As to whether the substitution was
"necessary", they relied on s35(6)(b) (any claim
already made in the original action cannot be
maintained by or against an existing party unless
the new party is joined or substituted as plaintiff
or Defendant in that action). CPR 19.5(2)(a) uses
similar wording to s35 and it was agreed has the
same meaning. It was argued that the "original
action" was essentially the claim for damages for
personal injury caused by the negligent driving of
B, and this had not changed. That action could
not be continued without the substitution of B's
Estate, therefore s35(5)(b) was satisfied.
Held Appeal dismissed:
1. Regardless of the application of s151 RTA
1998, the appeal required adding a party
without representations from them, in
circumstances where they would be deprived
of a statutory limitation defence, they would
be open to a real liability to pay damages to
Cs, or may otherwise be required to repay
sums to S if the judgment was satisfied under
s151.
2. The limitation regime is designed to ensure,
within reason, that potential defendants and
their insurers are put on notice within a
reasonable time so that an effective
investigation of the claim can take place and
that books can be closed after a reasonable
time. Subject to the interests of the Estate
and provided the ultimate target was S,
neither of those principles would be
offended. If this was simply a matter of
“doing justice” and discretion, therefore, the
(Continued from page 7)
January 2014 Page 8
On 15th November 2010 a claim form was issued,
giving four months to serve the claim form. On
18th February 2011 a photocopy of the claim
form was served, however this did not comply
with the requirement in CPR 6.3(1) for an original
sealed claim for to be served.
At 15.30 on 15th March Aegis asserted that the
claim form had not been properly served, while
consenting to an extension to serve Particulars of
Claim until 10th May. C applied for a further
extension of time, which was not agreed. An
application to extend time or to dispense with
service altogether was listed on 20th June, by
which time the claim form had still not been
served. The application was dismissed, and an
appeal against that decision was also dismissed.
C was advised to instruct fresh solicitors, who
issued a new claim in April 2012, served in May
2012 together with an application to extend time
under section 33 of the Limitation Act. The
application was refused. By that time the Aegis'
operation in Iraq had ended, and a container of
documents had been stolen. Some documents
were later retrieved but were so illegible as to be
useless. The judge found that the prejudice of C
having to pursue an unanswerable claim against
his former solicitors was slight compared to the
prejudice which would be caused to Aegis in
allowing the claim to proceed. The judge applied
McDonnell v Walker [2009] EWCA Civ 12573,
which contained dicta to the effect that it should
not be easy for a claimant, who had failed to
serve proceedings in time, to commence a second
action and obtain a disapplication of the
limitation period under s.33.
On appeal to the Court of Appeal, C argued that
McDonnell was inconsistent with the later
authority of Aktas v Adepta4 [2011] QB 894 [2010]
EWCA Civ 1270; that it was wrong to give any
weight to the fact that C may have a claim against
his former solicitors; that the judge was wrong to
find that there was any prejudice to Aegis after
the expiry of limitation; and if there was no such
prejudice, it was wrong to take into account
prejudice before the expiry of limitation.
Held: Appeal dismissed:
1. Aktas commented on the McDonnell case but
was not inconsistent with it. Essentially, in
(Continued on page 10)
It is becoming more and more common for
claimants to issue proceedings against an insurer
of a vehicle rather than its driver, particularly
where there has been non-cooperation or there is
some other element in the case which makes it
unusual. The present case was even more bizarre
in that, had it been allowed to proceed against B's
Estate, there would have been a claim before an
English court for an accident in Romania involving
only Romanian nationals. It was commented in
passing that nobody had considered the
jurisdictional aspects of such a consequence.
That scenario, if nothing else, should have been
sufficient to set alarm bells ringing. The case
therefore highlights all too well the dangers of
simply relying on the statutory indemnity. There
must be a good underlying claim before it bites.
[Sarah Keogh]
Davidson v Aegis Defence Services (BVI)
Ltd [2013] EWCA Civ 1586 [Longmore LJ,
McFarlane LJ, Vos LJ]
− Claim form served out of time
− New claim commenced
− s.33 disapplication refused
C was a protection operative engaged by Aegis as
a security enforcement team member in Iraq, on
a project for the United States government. He
suffered a back injury during training exercises in
November 2007. Aegis reported the accident to
the United States Department of Labor in
December 2007, which led to substantial
payments being made to C. However, C
maintained the total value of his claim was
£1.71m. He therefore had a residual claim, and
instructed solicitors in March 2009 to pursue the
claim against Aegis in the UK. Once medical
evidence was obtained, a letter before action was
sent in December 2009. It was July 2010 before
Aegis notified that it contested liability. C’s
solicitors chased for disclosure under the pre-
action protocol, and were informed by Aegis in
October 2010 that their enquiries were
incomplete. Limitation was due to expire on 22nd
November 2010.
(Continued from page 8)
Limitation - Substitution of Parties continued
January 2014 Page 9
the judge had taken into account. While he
did not explain in detail why Aegis could not
be criticised for delaying in searching for
documentation when they knew in 2009 a
claim was being brought, C's advisors
themselves were dilatory. He accepted that
the loss of documentation occurred without
any fault on Aegis' part. What did concern
him was that it would now be difficult or
impossible to discover who the other six
people on the training course were, who
might have given evidence as to the training
given. The judge clearly did not accept that
the case would turn almost entirely on expert
evidence as submitted by C.
4. The judge was also well aware that for the
purpose of section 33(3)(a) and (b), it was
delay after the expiry of the limitation period
that was important. As to delay prior to the
expiration of limitation, while this was not
relevant for section 33(3)(a) or (b), this was
still relevant to the overall picture.
5. In the circumstances the judge correctly
applied the guidance in Cain and was entitled
to come to the view that the limitation period
should not be disapplied.
Comment: There is now a weight of authority and
comment on when it is appropriate to disapply
the limitation period for a second claim in
circumstances where a first claim fails under CPR
7.6. This case confirms a common sense
approach - a court should not be trying to steer
between the Scylla of McDonnell and the
Charybdis of Aktas, but simply considering all the
factors relevant to the particular case. This is
likely to be a combination of prejudice to the
parties and criticisms which might be made in
relation to the conduct of the proceedings on
either side. [Sarah Keogh]
See however contrasting approach taken by
Phillips J in Hall v MOD digested below .
Hall v Ministry of Defence [2013] EWHC
4092(QB) [Phillips J]
− First claim struck out on application to
extend time for service of Claim Form
− Second claim issued
(Continued on page 11)
discussing the interplay between section 33
and CPR 7.6, McDonnell said that it should
not be too easy to disapply the limitation
period in circumstances where a first claim
had been brought out of time, Aktas said that
it should also not be too difficult. In either
case, the court did not question the guidance
in Cain v Francis [2009] 3 WLR 551:
"...in the exercise of the discretion the basic
question to be asked is whether it is fair and
just in all the circumstances to expect the
defendant to meet this claim on the merits,
notwithstanding the delay in commencement.
The length of the delay will be important not
so much for itself as to the effect it has had. To
what extent has the defendant been
disadvantaged in his investigation of the claim
and/or the assembly of evidence in respect of
the issues of both liability and quantum? But it
will also be important to consider the reasons
for the delay. Thus there may be some
unfairness to the defendant due to the delay in
issue, but the delay may have arisen for so
excusable a reason that, looking at the matter
in the round, on balance it is fair and just that
the action should proceed. On the other hand,
the balance may go in the opposite direction,
partly because the delay has caused procedural
disadvantage and unfairness to the defendant
and partly because of the reasons for the delay
or its length are not good ones."
2. On an examination of the authorities, having
to litigate a claim against a former solicitor is
not ideal, but is something which a judge can,
and normally should, take into account when
considering whether to exercise discretion
under section 33. In the present case, it was
clear the judge had in mind that the claim
would be for loss of a chance of success in
the original proceedings. However,
evaluating the merits of a personal injury
claim was common place for personal injury
lawyers.
3. As to the prejudice to Aegis, C submitted that
it was not known whether or not the stolen
container held any relevant documents, and
Aegis should have been searching for
relevant material during the six month
protocol period, therefore no prejudice could
be shown. However, these were all factors
(Continued from page 9)
Limitation - issue of new s.33 claim continued
January 2014 Page 10
− S.33 disapplication sought
− Whether liable to be struck out as an
abuse of process
Cases considered: Aktas v Adepta [2011]
QB 894, Icebird v Winegardner [2009]
UKPC 24, Horton v Sadler [2007] 1 AC 307.
H was a soldier who sought to bring a claim
against the Ministry of Defence for damages for
personal injury arising out of negligent medical
treatment given to him between September 2007
and July 2008. H issued a Claim Form in time on
27 August 2010. On 28 April 2011 H issued an
application for an extension of time for service of
the Claim Form. The application was treated as
made prior to the expiry of the time for service on
account of the MoD having offered an extension
of time for service to 28 April 2011. H did not tell
the MoD that the application had been issued
until 11 April 2012.
The application was eventually listed for hearing,
after some administrative failings on the part of
the Court, on 30 July 2012. Master Yoxall refused
to extend the time for service of the Claim Form
and struck out the Claim. H was also ordered to
pay the MoD’s costs of the Claim and the sum of
£3,000 by way of an interim costs order payment
on account of those costs.
In December 2012 H issued a second Claim Form
seeking the same relief on the same basis and
also seeking to dis-apply the 3 year primary
limitation period applicable to the claim, in
reliance on s.33 Limitation Act 1980. That Claim
Form was served in time and after the service of
the Particulars of Claim in February 2013, MoD
applied to strike out the Claim as an abuse of
process.
Deputy Master Eyre considered that H’s
indifference to the payment of the sum of £3,000
in accordance with the Order made by Master
Yoxall and indifference to the need to conduct the
claim against MoD promptly and fairly rendered
the second Claim an abuse of process and in
consequence the second Claim was struck out.
H appealed.
(Continued from page 10)
Limitation - abuse of process continued
January 2014 Page 11
Held: Allowing the appeal:
7. Following the House of Lords decision in
Horton v Sadler [2007] 1 AC 307, the fact that
an earlier claim issued within the limitation
period had been struck out for delay in
relation to service did not debar H from
seeking to bring a second claim out of time in
reliance on the provisions of s.33 of the
Limitation Act 1980.
8. Following the Court of Appeal decision in
Aktas v Adepta [2011] QB 894, the fact that H
had issued an earlier Claim Form in time and
the circumstances in which the same came to
be struck out fell to be considered as part
and parcel of all the circumstances of the
case in the exercise of the discretion given to
the Court to dis-apply the primary limitation
period pursuant to s.33 Limitation Act 1980.
9. Where a second claim is itself an abuse of
process it is liable to be struck out before any
consideration of s.33 arises.
10. A second claim is not an abuse of process
simply because an earlier claim was struck
out as an abuse of process. For a second
claim to be struck out as an abuse of process
there must be something more than a single
negligent oversight in timely service of the
earlier proceedings. The second claim may
be an abuse of process if there has been
inordinate and inexcusable delay, or
intentional and contumelious default, or
wholesale disregard of the Rules.
11. H’s failure to serve the first Claim Form in
time did not of itself render the second Claim
an abuse of process. The root of the failure
on the part of H to pay the interim costs
ordered in the first Claim lay with H’s
solicitors or insurers and could not be said to
amount to contumelious or intentional
default on the part of H or a wholesale
disregard of the Rules. Following Icebird Ltd
v Winegardner [2009] UKPC 24, a long delay
for which H could be held to be responsible
did not of itself amount to inordinate and
inexcusable delay. There had to be
something else which transformed the delay
into an abuse e.g. H had lost interest in the
claim and allowed the first Claim to fall by the
(Continued on page 12)
H as an abuse of process but it would seem that
the application notice was, in all probability,
issued before 1st
April 2013 with the consequence
that Phillips J followed the sort of approach
adopted before 1 April 2013 where the Rules
were treated as the handmaiden, rather than the
mistress, of justice (quoting from para. 26 of the
18th Implementation Lecture of the MR [Lord
Dyson])
Leaving those grumblings on one side, however,
there is a clear distinction to be drawn between
conduct which amounts to an abuse of process
and conduct which amounts to a breach of a CPR
rule or a Court Order. Whilst the latter may
attract a sanction of comparable consequence to
a strike out, and a sanction which the Court will
not now relieve, it is plain enough that to
constitute an abuse of process there must be
something amounting to contumelious and
intentional default or a wholesale disregard of the
CPR rules or Court Orders or some inordinate and
inexcusable delay which strikes at the root of a
fair adjudication of the issues between the
parties.
It is also plain enough that the gap between “the
high standards required of the parties as regards
promptness and fairness” in the conduct of
litigation and the claimant having fallen so far
below those standards that the claim must be
struck out, to which Phillips J referred, is now
considerably narrower than prior to 1 April 2013.
Although this case holds out the prospect that the
consequences of a procedural default in an earlier
claim can be lost in the wash of a s.33 application,
after 1 April 2013 the procedural default is likely
to weigh more heavily against dis-applying a
primary limitation period in the balancing of the
scales of justice on a s.33 application.
[Charles Scott]
Rehill v Rider Holdings Ltd (2014) CA (Civ
Div) [Lewison and Floyd LJJ]5
− C dishonestly exaggerated claim
− Part 36 offers
− Reasonableness of refusal
(Continued on page 13)
wayside, or prejudice to MoD arising from
the delay.
12. The Deputy Master erroneously considered
whether H had failed to meet the high
standards required of parties as regards
promptness and fairness and not whether H
had fallen so far below those standards that
his conduct could be categorised as
contumelious and intentional default or a
wholesale disregard of the Rules or
inordinate and inexcusable delay.
13. Given that the application for an extension of
time in the first Claim would have taken
some months to deal with and the fact that
the listing of the application was delayed by
the Court the period of 15 months which
elapsed in that application did not render the
second Claim an abuse of process. Similarly,
the 4½ months delay between the striking
out of the first Claim and the issue of the
second Claim could not be considered
abusive delay going beyond what would be
considered in a s.33 application in relation to
the second Claim. Such delays as there had
been could not be said to be inordinate and
inexcusable delays justifying the strike out of
the second Claim as an abuse of process. The
failure to satisfy the interim costs order was
not sufficient of itself, or in conjunction with
anything else, to render the second Claim an
abuse of process.
14. Even if the second Claim did amount to an
abuse of process the appeal court considered
that it would not be appropriate to exercise
its discretion to strike out the second Claim
but would be appropriate to direct the
matters in question be considered in the
context of the s.33 application which H was
obliged to make.
Comment: This case has to be viewed with a rosy
hue of nostalgia from those days prior to 1 April
2013 when the courts sought to do justice
between the parties rather than exact retribution
for a failure to comply with a CPR rule or an Order
of the Court.
It is unclear from the judgment when MoD
applied to strike out the second Claim brought by
(Continued from page 11)
Limitation - abuse of process continued
January 2014 Page 12
Procedure - Part 36 - Penalties
as to C's prognosis which continued until July
2008.
Although C’s conduct had been reprehensible, it
was not so egregious as to warrant a penal costs
order.
D appealed submitting that the recorder had
(1) been wrong to conclude that it had been
reasonable for P to refuse the April 2007 and
November 2007 offers;
(2) (2) erred in not imposing a costs penalty for
P's dishonest conduct.
Held: Appeal allowed:
1. The question for the recorder was whether P
had been reasonable in not accepting the
offers. By virtue of r.36.14(4)(c), the court had
to have regard to the information available
when an offer was made. The recorder had
considered the medical evidence available at
the time of the offers and noted that in
retrospect it had been prudent and
reasonable to await P's medical progress and
that there had been issues of contributory
negligence that had yet to be raised.
2. If P had indeed misled the lawyers, what was
reasonable had to be based on what P knew,
and not on what the lawyers knew. P had
reached the end of his recovery period when
the November 2007 offer was made; he was
discharged from hospital in December 2007,
and P knew in 2007 that he did not have a
genuine claim for adapting his home. The
reality was that there was no significant
uncertainty concerning P's orthopaedic
injuries when the November 2007 offer was
made, and those injuries formed the bulk of
P's financial claim. The only uncertainty
surrounding P's injuries at that time were his
abdominal injuries, which formed a minimal
part of his financial claim.
3. It was clear that the recorder had overlooked
the medical evidence and his findings about
P's mobility. The recorder had failed to
evaluate the consequences of those findings
in financial terms which in turn vitiated his
conclusions. It had been unreasonable for P
not to accept the November 2007 offer;
(Continued on page 14)
Procedure - Part 36 - Costs Penalties continued
− Imposition of costs penalties
C crossed the road when the pedestrian crossing
light were red and was hit by one of D's buses.
The bus driver did not apply the brakes quickly
enough. P sustained injuries that impaired his
mobility. Liability was apportioned equally
between both parties.
In April 2007, D offered £75,000 to settle C’s
claim. C refused. In November 2007 D made a
Part 36 offer which was also refused and D
withdrew the offer in January 2008 by which
stage C had reached the end of his recovery
period.
C’s schedule included adaptation costs exceeding
£71,000 to adapt his home owing to his impaired
mobility.
In June 2009 D made a further Part 36 offer of
just below £40,000 which remained open for 21
days. C refused.
Just before the quantum trial in April 2013, C
accepted D’s offer of £17,500.
Costs were not agreed and a hearing was held
before a recorder who ruled that the June 2009
offer had not been beaten and ordered C to pay
P’s costs up until July 2009 and C to pay D’s costs
from July 2009 on the standard basis.
The parties could not agree costs, and the
recorder held that the June 2009 offer had not
been beaten and ordered R to pay P's costs up
until July 2009 and for P to pay R's costs from July
2009 on the standard basis.
The recorder noted that C:
i) had dishonestly inflated his case
ii) had exaggerated his injuries
iii) lied about where he had stepped into the
road so as to minimise his culpability,
iv) had disputed the expert evidence concerning
his recovery,
v) had embellished his claim for building work
to his home
He found that C should have accepted the
November 2007 offer. The recorder did not order
C to pay D's costs before July 2009 as when the
April 2007 offer was made there was uncertainty
(Continued from page 12)
January 2014 Page 13
Procedure - Part 36 - Costs Penalties continued
however the same could not be said of the
April 2007 offer as there was still uncertainty
surrounding his orthopaedic injuries at that
time.
4. Accordingly, P was ordered to pay R's costs
from 21 days after the date of the November
2007 offer.
5. If the overall effect of the recorder's decision
had been that P received his costs for being
dishonest then that would have been wrong;
however that was not its effect: Ultraframe
(UK) Ltd v Fielding (Costs) [2006] EWCA Civ
1660 considered.
6. The recorder held that the costs incurred in
promoting a dishonest case could not be
reasonably incurred. Further, the recorder's
observations on P's conduct did not bind the
costs judge. Very little remained given that P
had been ordered to pay R's costs from
November 2007 and that the litigation had
commenced in July 2008.
7. Although the recorder had been generous in
not imposing a penalty for dishonesty and
other judges might have taken a stricter
stance, that decision was within the ambit of
the recorder's discretion.
Comment: The full judgment is not yet available
and is likely to repay reading in full. There are
many such claims where the claimant’s own
knowledge of the state of his health and recovery
differs from that which is reported to the
examining doctors (including medical experts)
and his legal representatives. This appears to be
the first reported decision that has focused on
this aspect of ‘date of knowledge’ in the
consideration of dishonesty/exaggeration and the
wide ambit of discretion available under r.44.2
which includes considering when Part 36 should
have been offered. In this regard, this discretion
is an inroad into an otherwise encapsulated Part
36 code as many recent authorities have sought
to reinforce.
PIMLU may revisit this case when the judgment is
available but for the present the message must be
that whilst not wishing to displace the trust an
injured claimant places in his legal team, this
(Continued from page 13)
January 2014 Page 14
must be balanced against a forensic duty to ‘test’
the evidence which includes the claimant’s
reportage of the nature and extent of his disability
and to raise appropriate enquiries with the
medico-legal experts.
Careful explanation must be given to claimants of
the effect of Part 36 offers which are rejected,
should the ultimate finding of the court be that
the stage of recovery and level of disability differs
to that represented by a claimant. Not only is a
claimant at risk of a penalty for dishonesty but his
damages are likely to be eroded if not exhausted
by the defendant’s costs that he is required to
meet. Those acting for him should also appreciate
that the inevitable effect of such a finding is that
there will be no surplus funds to meet their own
costs of representation of such a claimant: see, for
example Hussain v Chartis digested below)
Those acting for defendants also need to ensure
that their medico-legal experts - whilst being
sensitive to a claimant who has suffered injury
through no fault of his own - must be prepared to
probe the reported history of subjective
symptoms with principal reliance being upon
objective signs of the state of recovery as elicited
upon clinical examination. [Deirdre Goodwin]
MacLennan v Morgan Sindall
(Infrastructure) Plc [2013] EWHC 4044
(QB) Green J.
− P I Case Management
− Court’s power to regulate nature and
extent of witness evidence
− Guidance: CPR parts 32 and 38
C, an employee of D, suffered a severe brain injury
in an accident at work. Liability was admitted
with 25% contributory negligence conceded and
judgment was entered with damages to be
assessed.
The quantum case was estimated to last 5 days
with a trial window commencing at the end of
March 2014. During case management D applied
for an order limiting the number of witnesses C
could call at trial.
(Continued on page 15)
Procedure - PI Case Managet
Procedure - PI Case Management continued
C proposed to tender the evidence of 43
witnesses concerning loss of earnings, their
statements covering four broad issues:
i) whether, but for the accident, C could have
worked abroad and earned more than he
would have in the United Kingdom;
ii) whether he would have retired at 65 or 70;
iii) what his promotion prospects might have
been; and
iv) what earnings he could reasonably have
expected.
D submitted that those issues were common in
personal injury cases, and it sought an order
pursuant to CPR r.32.2(3) limiting C to calling no
more than eight witnesses as earnings
comparators.
Held: The court gave directions setting out a
number of considerations that the court was to
be guided by when dealing with such applications:
1. The 43 witness statements covered a range of
matters relating to the four broad issues. They
were extremely brief; they did not attach
corroborative or supporting documentation;
and they included assertions about the
availability of work in the UK and abroad,
rates of pay, typical retirement ages, and C's
qualities and employment prospects
generally. There was material duplication,
though the repetition of a proposition by a
variety of witnesses could be said to add to its
weight, and it was possible that the sum of
the evidence might exceed the probative
weight of its parts (see para.5 of judgment).
2. Under CPR 32.2(3), which came into effect as
a result of the Jackson reforms, the court had
the power to deploy a range of possible
solutions in order to reduce costs and ensure
that the trial was conducted effectively. The
following considerations were relevant to the
exercise of that power:
(a) CPR r.32 had to be read as a whole. The
court had to use all the powers at its
disposal to ensure the efficient and fair
conduct of the trial, and it would only
consider prohibiting the calling of
(Continued from page 14)
January 2014 Page 15
witnesses after less intrusive measures
had been considered and rejected;
(b) a court seeking to regulate the nature and
extent of witness evidence would
generally wish to do so at an early stage,
before the preparation of witness
statements. At that stage it might also be
possible for the parties to identify matters
which might be admitted;
(c) while the power to exclude or control
witness evidence was best exercised
before the preparation of witness
statements, the court was not precluded
from exercising it after statements had
been drafted;
(d) before exercising its power to prohibit the
adducing of witness statement evidence,
the court had to have the fullest possible
information, adequate preparation time,
and guidance from the parties as to which
parts of which statements were said to be
otiose, prolix, or otherwise inadmissible;
(e) where the court did exercise its power, it
might be necessary to give the parties
liberty to vary the order by consent or to
apply to the court for a variation. In that
regard, the court would be entitled to
expect a considerable degree of co-
operation and good sense. A lack of co-
operation could not be justified by an
assertion that the relationship between
the parties' legal advisers was not good
(paras 11-12).
3. In the instant case, some form of case
management was required. One possibility
would be to impose a process which required
C to identify the specific facts and propositions
relied upon from the witness statements; D to
identify which were agreed and disagreed; and
C to indicate which witnesses he intended to
call. However, that was not appropriate in the
instant case: time was short, the parties had
not exhibited any great ability to cooperate,
and there was a real risk that a process
involving multiple stages could delay the
preparation for trial.
4. The preferable course was as follows.
(Continued on page 16)
Procedure - PI Case Management continued
i) C would be permitted to call 14 witnesses
to address the issue of comparative
earnings. That was the minimum number
the Judge considered necessary, and D did
not demur;
ii) C was to write to each forthwith
requesting certain specified details of their
earnings, with supporting documentation;
iii) If a witness declined to co-operate, C was
to write to D's solicitor, setting out the
steps he had taken and the response he
received;
iv) C could call 14 additional witnesses to
cover matters other than comparative
earnings. That was the critical mass the
Judge considered necessary, and it was
likely that their evidence could be heard
swiftly. Any fewer risked causing injustice.
The evidence of C and his wife could also
be tendered;
v) C was to identify the witnesses and serve
any documents as directed; he could not
rely on statements from witnesses who
had not been identified, though there was
nothing to stop him from seeking to rely
upon evidence following service of a valid
hearsay notice if it was proper to do so;
vi) Where any expert evidence relied on the
statements of individuals who were not on
the list of identified witnesses, there was no
need for the experts to exclude reliance on
those witnesses;
vii) Finally, both parties had liberty to vary the
scheme by agreement or to apply to the
court for a variation (paras 15-27).
Comment: This seems to be the first reported
High Court decision in which the court’s new
powers to limit factual witness evidence have
been exercised. Accordingly, although the
exercise in this case was fact-specific, this
guidance should be heeded in the proposals for
factual witness statements made in all personal
injury claims post-1 April 2013 and not just those
involving catastrophic injuries as in the instant
case.
(Continued from page 15)
January 2014 Page 16
Although the number of witnesses the C wished
to call was significant (even by pre-1 April 2013
standards) the loss of earnings issue was clearly
significant . Equally important, however, was the
need to avoid the repetition that so often
characterises such supporting ‘comparator’
evidence and to both define and refine the issues
which this evidence is intended to address. Such
reasoning was apparent in the tenor of the
judgment and the continuing need for strong case
management to ensure the trial proceeded in a
fair and efficient manner. [Deirdre Goodwin]
Smith v Secretary of State for Energy &
Climate Change [2013] EWCA Civ 1585
Longmore LJ, Underhill LJ, Floyd LJ
− Noise induced hearing loss claim
− CPR 31.16 application for pre-action
disclosure
− Whether documentation sought was
a ‘speculative punt’
The appellant, a former coal miner, believed he
had suffered hearing loss as a result of working
without hearing protection in a noisy work
environment. Before any proceedings were issued
the Appellant sought documents from the
Respondent: documentation relating to noise
tests, documentation relating to the
Respondent‘s consideration of the problems
caused by noise and their decision to supply ear
protection, copies of warning notices and safety
committee meeting minutes.
A district judge allowed the appellant’s
application for pre-action disclosure under CPR
31.16.
Judge Langan reversed the district judge’s
decision, holding that he was bound by the
decision in Kneale v Barclays Bank Plc (t/a
Barclaycard) [2010] EWHC 1900 and accordingly
that the Appellant had to show, in Flaux J‘s,
words, ‘some kind of prima facie case which is
more than a merely speculative punt’. The issue
for him was whether the Appellant had
surmounted what he described as ‘this modest
(Continued on page 17)
Pre - action Disclosure - r.31.15
Procedure - Pre-action Disclosure continued
jurisdictional threshold’. Judge Langan found that
in the absence of an opinion to the effect that the
appellant‘s hearing loss is more probably noise-
induced than constitutional, the factual
foundation of his potential claim was so fragile
that it has to be regarded as what Flaux J called ‘a
punt’.
The appellant appealed to the Court of Appeal.
Held: leading judgment given by Underhill LJ:
1. There is no jurisdictional ‘arguability
threshold’. The jurisdictional requirements
for the making of an order under CPR 31.16
are expressly set out at heads (a)-(d) in para.
(3) of the rule, and they say nothing about
the applicant having to establish some
minimum level of arguability; Kneale v
Barclays Bank Plc (t/a Barclaycard) [2010]
EWHC 1900 overruled in part.
2. As to the court’s discretion under CPR 31.16:
3. It falls to be considered in the exercise of the
court’s discretion under CPR 31.16 whether
the applicant has shown some reason to
believe that he may have suffered a
compensatable injury; and, if so, with what
degree of likelihood. The language of
‘arguability should be avoided’. Black v
Sumitomo Corporation [2002] 1 WLR 1562
([2001] EWCA Civ 1819) followed.
4. If, in the present case, there was no reason
to believe that the appellant might have
suffered noise-induced hearing loss then it
would not be right to order pre-action
disclosure; and even if he had got over that
hurdle but the claim could nevertheless be
characterised as ‘speculative’ it might be
wrong to require any disclosure which was
onerous.
5. The District Judge did not exercise his
discretion wrongly. The evidence that the
Appellant had suffered hearing loss was
indeed very short on detail, and those
advising potential claimants in similar
circumstances would be encouraged to
provide the Court, if they can, rather fuller
evidence than was proffered in this case.
Nevertheless the District Judge was not
(Continued from page 16)
January 2014 Page 17
obliged to ignore the evidence proffered
without an audiogram or a medical opinion.
6. Per Longmore LJ: Applications for pre-action
disclosure are not meant to be a mini-trial of
the action and should be disposed of swiftly
and economically. Elaborate arguments are
to be discouraged.
Comment: Underhill LJ observes at paragraph 22
of his judgment this decision is unlikely to be of
much importance in practice. One could argue
that the ‘arguability threshold’ is simply moved
from the jurisdiction stage to the discretion stage.
However the tone of the Court of Appeal has
noticeable changed since Rose v Lynx Express Ltd
[2004] EWCA Civ 447 [2004] 1 BCLC 455. The
Court held in Rose that it ‘will normally be
appropriate’ to approach the conditions in CPR r.
31.16(3) on the basis that the substantive claim
pursued in the proceedings needs to be ‘properly
arguable and to have a real prospect of success’.
In contrast Underhill LJ in Smith merely asks
‘whether the [applicant] has shown some reason
to believe that he may have suffered a
compensatable injury; and, if so, with what
degree of likelihood’; the language of ‘arguability
should be avoided’. It is submitted that the
language of ‘real prospect of success’ should also
be avoided.
The ‘threshold’ does appear to have been
lowered. [Paul Gurnham]
Harrison v Black Horse Ltd (2013) Sen Cts
Costs Office (Master Gordon-Saker) 20
December; [2013] EWHC B28 (Costs)
− CFAs
− Notice of Funding not served
− Application for relief from sanction
− Guidance given post 1 April 2013
Cs’ claim against the D Bank for recovery of
premiums in respect of mis-sold PPI was
dismissed following a County Court hearing.
Cs appealed unsuccessfully to the High Court and
the Court of Appeal. Cs then obtained permission
(Continued on page 18)
Procedure - CFA default - Costs
to appeal to the Supreme Court, at which point
the case was settled with D agreeing to repay the
premiums with interest, and pay Cs’ costs but not
any ATE premiums.
There were 4 CFAs in place between the Cs and
their solicitors (M) in respect of the original
County Court hearing and each of the three
appeals [paragraph 7]. Notice had been given of
the County Court and the Supreme Court appeal
premiums. M admitted failure to give notice of
the High Court appeal premium but there was
dispute whether notice had been given in respect
of the Court of Appeal hearing where Cs’ costs
were £1,483,284.70.
M maintained they had sent the Court of Appeal
proceedings funding notice via the DX.
In Points of Dispute served in February 2013, D
denied receiving the notice and claimed that
under the operation of CPR r.44.3B(1) the Cs were
not entitled to recover any success fees or
counsel’s fees incurred under the CFA relating to
the Court of Appeal:
CPR 44.3B (in its pre 1st April 2013 form)
provides:
“(1) Unless the court orders otherwise, a party may
not recover as an additional liability—
…..
(c) any additional liability for any period during
which that party failed to provide information
about a funding arrangement in accordance
with a rule, practice direction or court order;”
The sanction is automatic.
In July 2013 Cs applied for relief from sanction
under CPR r.3.9.
Held: Relief refused:
1. M’s file contained a copy of the letter to D
purporting to enclose an “updated notice of
funding” and a copy had been faxed to the
Civil Appeals Office but M was unable to
prove service under CPR r.6.26.
2. The sanction in r.44.3B(1) was automatic and
since the requisite notice had not been given,
Cs could not recover success fees in relation
to the Court of Appeal hearing unless the
court granted relief from sanction.
(Continued from page 17)
Procedure -CFA default - sanction relief continued
January 2014 Page 18
3. The relevant version of r.3.9 was in force.
While it was clear that M had intended to
give D notice of the CFA, and there was no
reason to doubt that they believed that they
had done so, the purpose of the notice was to
alert the other party to the possibility of its
having to pay success fees or insurance
premiums if it was ordered to pay costs.
4. D's unchallenged evidence was that it had had
no reason to assume that the appeals were
funded by CFAs and that, had it known, its
approach to settlement might have been
different. That evidence, which had to be
taken at face value, was sufficient to show
that D had been prejudiced by the failure to
give notice.
5. Under the pre-April 2013 version of r.3.9, the
case for relief would have been borderline: Cs
had given notice of the first CFA, and their
failure to give notice of the third was
inadvertent [paragraph 42]; on the other
hand, they had failed to give notice of the
second CFA and had not applied for relief
promptly [paragraph 43].
6. Under the new version of CPR 3.9, the
circumstances of the case, while still relevant
factors, must now play second fiddle to the
factors specifically listed in the new rule
which has introduced a tougher approach to
relief applications. If the failure to give notice
could properly be regarded as trivial, relief
would usually be granted provided that the
application had been made promptly. If the
failure could not be characterised as trivial,
the defaulting party bore the burden of
persuading the court to grant relief. The court
had then to consider whether there was a
good reason for the default, Mitchell v News
Group Newspapers Ltd [2013] EWCA Civ
15266, paragraphs 40 and 41 followed [see
paragraphs 44 and 45 of the judgment].
7. Cs’ failure could not be said to be trivial: no
notice had been given at all. The burden was
therefore on the Cs to show a good reason for
the default and they had not shown this
[paragraphs 347 to 48]
8. While that might seem harsh, M should have
known that r.3.9 was to be amended so as to
(Continued on page 19)
introduce a tougher approach, and an
application for relief could have been made
before April 1. Once again reference was
made to the 5th Implementation Lecture by
Jackson LJ and the 18th Implementation
Lecture by the Master of the Rolls [paragraph
49].
Comment: A reminder, if any was needed, that
any residual discretion vesting in the court -
whether on substantive issues or costs - will be
sparingly exercised, requiring overt evidence of
triviality before the presumption of automatic
refusal of relief from sanction is rebutted.
The irony is that a prompt application for relief in
February may well have resulted in the court
deciding (under former r.3.9) that relief could be
granted (see line of cases including Rayaan7
considered in October/November 2013 PIMLU).
Indeed, Master Gordon Saker had mentioned in
March 2013 that the Cs may wish to pursue an
application for relief from sanction (paragraph 14]
The result on the issue of principle however is
that even at the stage of costs following
consensual settlement, the procedural
Damoclean sword remains poised. Under new
r.3.9 the reported decisions have been to the
benefit of defendants and the detriment of
defaulting claimants, as Mitchell amply
demonstrates. The platitudinous murmurings of
the courts that such decisions may be viewed by
some as harsh will be but cold comfort to those
who succeed on the merits only to find such
success rendered a Pyrrhic victory by the
outcome on costs. [Deirdre Goodwin]from
Adlington & 133 others v Els
International Lawyers LLP (in
administration) [2013] EWHC B29 (QB)
HHJ Oliver Jones QC, sitting as a High
Court Judge
− Strike out of claim
− Relief from sanction granted
(Continued from page 18)
− Conduct not egregious but matter of
form rather than substance
− Pressure of work is not an excuse
In a group professional negligence action arising
out of losses allegedly suffered in respect of failed
investment in the purchase of ‘off-plan’ property
in Spain, the Particulars of Claim had been drafted
by the deadline but 8 out of 133 claimants were
unable to sign their statements of case because
they were abroad or otherwise unavailable.
The Cs in question sought relief from sanction,
namely strike-out of their claim.
Held: Application granted:
1. The judge reminded himself that under CPR
1.1 and amended 3.9 with effect from 1st
April 2013, cases not only have to be dealt
with justly but at proportionate cost.
2. As the decision in Mitchell underscores, we
are now in a new ’era’ or ’culture’ that must
take a ’no-nonsense approach’ and Jackson LJ
had made it clear in Fred Perry (Holding) Ltd v
Brands Plaza Trading Ltd [2012] EWCA 224
that there was concern that relief from
sanction was being granted too readily with
’such a culture of delay and non-compliance’
being injurious to the civil justic system and
litigants generally. That decision was
reinfored by Edwards-Stuat J in Venulum
Property Investment Ltd v Space Architecture
Ltd [2013] EWHC 1242 (TCC)8 [para 22].
3. The case had an unhappy history with the Cs
and their solicitors not being well-organised
and not having a clear command of the Civil
Procedure Rules or the management of the
case when breach of an ‘unless order’
became almost inevitable [paras 29-30].
4. However, the starting point was to consider
the nature of the non-compliance which in
this case arose through the lawyers not being
aware of the holiday dates. Further, with the
claimants split into three tranches with
different deadlines, had D agreed to transfer
them to a later tranche, as had happened
with some other claimants, there would have
been full compliance. The relationship
between justice and procedure
(Continued on page 20)
Procedure -CFA default - sanction relief
January 2014 Page 19
Procedure - Sanction Relief
on ‘pressure of work’ as an excuse, although
he clearly was under great pressure. If he had
advanced these excuses, then it would have
been likely that they would have been
rejected.
“The real reason for the failure to comply was
the fact that Mr Cotter did not realise that a
few of his clients would be simply unavailable
to sign their particulars of claim when the
time to do so arrived. The arrangements for
holidays made by the eight relevant claimants
were outside Mr Cotter’s control.” [para 33]
9. HHJ Oliver-Jones QC emphasised that he had
not ignored the wide range of interests
affected by compliance failures and the need
to be more robust about them,
“ … nor focused exclusively, or even primarily,
on doing justice between the parties in this
individual case, although clearly I have had to
consider the latter in the context of the
former” … “I bear in mind that in reaching the
conclusions he did in his final report, Sir
Rupert Jackson rejected what he described as
‘the extreme course which was canvassed as
one possibility in [the preliminary report]
paragraph 43.4.21 or any approach of that
nature’ (my emphasis added), namely that
non-compliance would no longer be tolerated
save in ‘exceptional circumstances’.
Thus the circumstances do not have to be
exceptional to attract the granting of relief,
but a decision as to whether or not relief
should be granted does involve the ‘change of
balance’ implicit in the new wording of CPR
3.9.
I have undertaken that balancing exercise and
given great weight to the two factors
identified expressly in the rule. However,
bearing in mind that the relationship between
justice and procedure has not changed so as
to transform rules and rule compliance into
trip wires, and ‘nor has it changed it by
turning the rules and rule compliance into the
mistress rather than the handmaid of
justice’ [quoting from the Master of the Rolls
8th Implementation speech], I am satisfied
that relief should be granted in all the
circumstances of this case.” [para 34]
10. If pressure of work was cited as the reason
for non-compliance, relief from sanction
would not be granted, but a lack of
(Continued on page 21)
“has not changed so as to transform rules
and rule compliance into trip wires”.
[paras 23 and 26(b)(ii) (quoting from Lord Dyson
(MR) 18th Implementation Lecture para 26) and
paras 30-34]
5. The application for relief was made promptly
and had an application for an extension been
made before the deadline had expired, “it
would almost certainly have been
granted” [para 32(a)].
6. The ‘nature’ of non-compliance cannot be
divorced from consideration of the
‘consequences’ of non-compliance. Whether
or not a failure to comply with an order is
‘significant’ or ‘insignificant’ must involve
having regard to consequences.
“In these cases there were no adverse
consequences at all, either to the defendant
or to the efficient conduct overall of this
litigation.”
In particular a two-month stay took effect
following service of the particulars of all the
claimants to allow the defendant the
opportunity of considering all 134 of them,
and at the time this commenced, there were
no “stragglers”. [para 32(b)]
7. The court therefore accepted’ Cs’ submission
that this was a failure of form rather than
substance’. As such, this failure could
‘properly be regarded as an insignificant
failure that in the context of the court’s order
as a whole and the reasoning underlying the
sanction, can properly be regarded as trivial.
In these circumstances, to refuse relief would
be a ‘disproportionate response’ on the basis
of the solicitor’s ‘regrettable but not
egregious’ errors. [para 32(a)]
8. Even if the court was wrong to consider the
non-compliance trivial, it would have been
persuaded to grant relief in the
circumstances:
“Applying the guidelines in Mitchell, the
question then becomes, was there a good
reason for the default? The claimant’s solicitor
does not suggest he overlooked or otherwise
disregarded the deadline; on the contrary, he
was very acutely aware of it. Nor does he rely
(Continued from page 19)
Procedure - Relief from Sanction continued
January 2014 Page 20
dismissed by Hildyard J who found serious failures
to comply. On the r.3.9 application for relief from
sanction he drew on Tarn Insurance Services Ltd v
Kirby & Others [2009] EWCA 19 which required
the court to take a ’rigorous approach’. He
referred to “remarkable instances” where the Ds
had not provided evidence. He therefore refused
relief from sanction and debarred the Ds from
defending the claim; their defence and
counterclaim were struck out. This Order was not
appealed nor the earlier ‘unless’ orders.
Two days before trial the Ds applied for relief
from sanction which led to the trial being relisted
5 days later with a time estimate of 5 days, with
the relief application to be heard on the first day
of trial which was in October 2013.
The deputy judge allowed 4 of the 5 days to be
taken up with the relief application. He granted
relief on the basis that the Ds had complied with
the unless order albeit “belatedly” [paragraph
15]. He rejected C’s submission that the
application for relief was an abuse of process
relying upon Woodhouse v Consignia Plc [2002]
EWCA Civ 275 as ‘clear authority’ that the
application for relief was permissible [paragraph
17].
C appealed.
Held: Appeal allowed, Mitchell guidance
reinforced:
1. The deputy Judge had been wrong to rely on
the decision in Woodhouse for authority that
a second application for relief was
permissible. Woodhouse was not to be read as
displacing the normal operation of CPR r.3.1
(7) in a case involving CPR r.3.9. D1's "second
bite" application was in substance an
application under CPR 3.1(7) for the setting
aside of the provisions of the earlier order
refusing relief under CPR 3.9, and had first to
satisfy the criteria in Tibbles v SIG Plc (t/a
Asphaltic Roofing Supplies) [2012] EWCA Civ
518, which it manifestly did not, Tibbles was
followed and Woodhouse distinguished on the
ground that it did not involve setting aside a
previous order refusing relief from sanction
[see paragraphs 23 to 31 of judgment]:
“The reasoning [in Woodhouse] does not sit
altogether comfortably with the policy of the
(Continued on page 22)
knowledge of holiday arrangements could be
treated with a tolerant approach [para 33]
Comment: There may be some comfort to be
derived from this clearly expressed and reasoned
judgment in which HHJ Oliver Jones QC
specifically lays emphasis upon the 18th
Implementation Lecture to state that only
allowing relief from sanction in ‘exceptional
circumstances’ was not the intention of the
Jackson reforms.
The suspicion must be however that his is a lone
stand against the inexorable tide of appellate
determination that the circumstances must
indeed be ‘exceptional’ - not low tolerance but
no tolerance. The general trend of the appellate
decisions on r.3.9 allows no room for doubt that
other than in ‘exceptional circumstances’ (and
which in fact existed in this case), there will be no
hiding place for those in default. This approach is
starkly demonstrated in the subsequent Court of
Appeal decision Thevarajah v Riordan digested
below. [Deirdre Goodwin]
Thevarajah v Riordan, Burke, Prestige
Property Develop UK Ltd and Barrington
Burke [2014] EWCA Civ 15 [Richards,
Aikens and Davis LJ]9
− Disclosure - non-compliance
− Unless orders
− Strike-out
− Relief from sanction
− Appropriate approach to CPR r.3.9
In a property dispute involving the purchase of a
public house,, C applied for injunctive relief and a
worldwide freezing order on D1’s assets. D1
failed to comply with disclosure obligations and
only partially compled with a subsequent ‘unless’
disclosure order made by Henderson J. D1 failed
to comply fully.
C issued an application seeking a declaration that
the sanction in the unless order had come into
effect and strike out of the defence and
counterclaims. The Ds cross-applied for relief
from sanction pursuant to CPR 3.9 which was
(Continued from page 20)
Procedure - Relief from Sanction continued
January 2014 Page 21
(3) Thirdly, by allocating more than four of
the five days allotted to the trial to be
spent on the relief application, the deputy
judge had allowed the application for
relief from sanction hearing to take up a
disproportionate amount of court time
[paragraphs 10, 37).
(4) Fourthly, the deputy judge had also
questionably observed that even if D1
remained debarred from defending the
claim, they would be entitled at trial to
require C "to prove his claim, to cross-
examine and make submissions" but the
authorities to which he had referred did not
support so sweeping a proposition, Culla
Park Ltd v Richards [2007] EWHC 1687
(QB) and JSC BTA Bank v Ablyazov [2012]
EWCA Civ 1411, [2013] 1 W.L.R.
1331 considered [paragraph 38].
Comment: The Lawtel summary is slightly
misleading as on occasions this refers to the
decision of a district Judge whereas the order
appealed by D1 was made by Andrew Sutcliffe
QC, sitting as a deputy High Court Judge in the
Chancery Division.
It is of note that the deputy judge derived the
principles he applied from the first instance
decision in Raayan al Iraq Co Ltd v Trans Victory
Marine Inc [2013] EWHC 2696 (Comm)
[paragraph 13]. In fairness, this decision was
good law at the time of his judgment in which he
also referred to the first instance decision of
Master McCloud in Mitchell. The approach by
Andrew Smith J in Raayan however was expressly
disapproved by the Court of Appeal in Mitchell as
having applied the wrong test under the new
r.3.9; in particular, having sought to do justice
between the parties, rather than taking account
(as now required) of the wider implications of the
likely impact of non-compliance and delay upon
the administration of justice as a whole.
Not only does the judicial ‘dressing-down’ in this
decision unequivocally reinforce the guidance in
Mitchell but it is a significant judgment in its own
right, drawing together, as it does, preceding
decisions which might otherwise have been
considered as providing judicial ‘wriggle room’ to
(Continued on page 23)
April 2013 rule changes … as underlined by the
Mitchell judgment in relation to CPR 3.9 in
particular
2. The deputy judge had been wrong to hold
that D1's subsequent compliance with the
unless order amounted to "a material change
of circumstances" since the date of the order.
D had failed to satisfy the criteria in Tibbles
[paragraphs 30 and 31] and there was no
other basis for an application under CPR 3.1
(7) to vary or revoke the order [paragraph 31].
Obiter
3. The court addressed other concerns about the
deputy’s judge’s decision:
(1) Firstly, even if the deputy judge had been
entitled to give fresh consideration to the
question of relief from sanction, his
general approach to the application of
CPR 3.9 in its current form was wrong in
principle. It lacked the robustness called
for by the guidance subsequently given
in Mitchell v News Group Newspapers Ltd
[2013] EWCA Civ 1537, [2013] 6 Costs L.R.
1008. His judgment gave insufficient
consideration to the need:
a) for litigation to be conducted
efficiently and at proportionate cost,
and
b) to enforce compliance with rules,
practice directions and orders,
considerations which "should now be
regarded as of paramount importance
and be given great weight":
There is a … striking contrast between
the deputy judge’s approach and that of
Hildyard [which] sits well with the
guidance in Mitchell”
[paragraph 35]
(2) Secondly, the deputy judge had paid
insufficient attention to D1's lack of
promptness in bringing the second
application (see paragraphs 18 and 19
where his decision is quoted]: Tibbles,
Mitchell, and Durrant v Chief Constable of
Avon and Somerset [2013] EWCA Civ
1624 followed (para.36).
(Continued from page 21)
Procedure - Relief from Sanction continued
January 2014 Page 22
side-step the guidance in Mitchell perceived (by
some) to be unduly and unnecessarily draconian
Mitchell (see Adlington digested at pp 17-19
above)
At paragraph 34 of the judgment, Richard LJ
emphasised that they had not heard oral
submissions in respect of those matters upon
which they made obiter observations and that
they did not need to base their decision upon
these matters as the operative reasons for
allowing the appeal are those given at paragraphs
23—33 [see paragraph 39].
The obiter observations however not only
reinforce the construct and obligation to comply
with the new r.3.9 but emphasise once again the
obligation to consider each case in the efficient
and resource-aware conduct of litigation across
the whole judicial system.
There is truly now no procedural hiding-place: the
message is simple - not low or no tolerance (save
in certain circumstances but absolutely no
tolerance save in the most unusual and
exceptional of circumstances. Those who
continue to console themselves with the belief
that the current approach of the judiciary is akin
to that of the zealousness of newly appointed
school prefects which will soon settle down to
‘business as usual’ - as was the position in the
aftermath of the introduction of the CPR in 1998
- will be deluding themselves. This punishing
regime, in all senses, is here to stay and everyone
should include in their New Year Resolutions a
check on the level of their professional indemnity
insurance cover. [Deirdre Goodwin]
Hussain v Chartis Insurance UK Ltd
[2013] EWHC, Simler J 9th Dec
(unreported)
− Road traffic accident resulting in
brain damage
− Causation disputed
− CFA
− Part 36 offer and success fees
(Continued from page 22)
Road Traffic - Part 36 - CFA
C sustained very serious injuries in a road traffic
accident including a head injury that resulted in
brain damage. D1 contended that C had
physically attacked him and in attempting to drive
away a collision had occurred. Accordingly,
liability and causation were in dispute.
The D2 insurer made a Part 36 offer of £350,000
which was accepted prior to trial.
C was funded by 2 CFAs with a fixed success fee of
12.5% but sought a higher success fee under CPR
r.45.18(2)(c) which permits a higher success fee if
it was reasonable to expect that “if” the court had
awarded damages they would have been greater
than £500,000, ignoring any reduction for
contributory negligence.
The Master refused the application because he
was not satisfied that if C had established
negligence he would have established causation
and so it was not reasonable to expect that the
court would have awarded damages greater than
£500,000.
C appealed to the Judge submitting that the
assumption from which the master should have
started was that liability, including causation, had
been established.
Held: Appeal allowed:
1. In construing CPR r.45.18(2)(c) primary
liability was assumed. From first principles,
and in the absence of authority, primary
liability encompassed the question of breach
of duty and causation. In order to be an
actionable tort, there had to be a breach of
duty that caused recoverable loss. Causation
was not a separate issue. There was blurring
between contributory negligence and
causation; for example, a road traffic accident
where a claimant had not been wearing a
seatbelt. That was often seen as a
contributory negligence issue but could
logically be dealt with as causation. However,
it was difficult to think of scenario where
failure to wear a seatbelt caused the accident.
The critical word in CPR r.45.18(2)(c) was "if."
There could not be an award of damages
unless the court found not only breach of
duty but that the breach caused some
recoverable loss. If the court had been
(Continued on page 24)
Procedure - Relief from Sanction continued
January 2014 Page 23
This Personal Injury and Medical Law
update provides summary and
comment but is not a substitute for legal
advice. For further information on
contents, please contact Deirdre Goodwin
or Adrian Higgins or email:
ENDNOTES 1
see Coles v Perfect [2013] EWHC 1955 Teare J digest and
comment in October/November PIMLU pp 1-3
2digested in March / April 2011 PIMLU p17
3See digest and comment upon this case by Sarah Keogh in
November 2009 PIMLU, pp 12-14
4 digested by Sarah Keogh in December 2010 PIMLU pp12-13
5 digested in June 2012 PIMLU pp 11-12; see too
Paramasivan v Wicks - CA (Civ Div) (Judges LJ, Aikens LJ)
23/01/2013 where reference was made to Rehill - digested
in February/March 2013 PIMLU by Deirdre Goodwin at pp 22-
24
6 see digest and comment on Mitchell by Deirdre Goodwin in
December 2013 PIMLU pp 7-10 as well as Biffa Waste
Services v Dinler [2013] EWHC 3582 (QBD) Swift J. at p6 and
Durrant v Chief Constable of Avon & Somerset
Constabulary [2013] EWCA Civ 1624 at pp11-126
7 see digest and comment on Rayyan Al Iraq at pp 17-19 of
the October / November 2013 PIMLU
8 See digest in May/June 2013 PIMLU, pp 4-5
9 see digest and comment by Deirdre Goodwin upon first
instance decision of Andrew Smith in Thevarajah [2013]
EWHC 3179 [Ch] in September / October 2013 PIMLU pp18-
19
required to assess whether C could prove that
there was a duty of care or causation, then
the wording of the rule would have been
different.
2. Further, it would mean that claims that had
prospects of success by the time of
settlement of 50 per cent or less could never
have the benefit of an increase in the success
fee. That was not what was contemplated by
the rule, the rationale behind which was to
provide an exception for bigger, riskier claims.
3. The master was right to say that he was
entitled to consider all the evidence in making
the best assessment of the likely damages
that would have been awarded at trial, on the
assumption that primary liability and
causation had been established. However, his
conclusion that C would have failed to
establish that negligence caused his brain
injury, and thus had failed to establish that he
would have been awarded over £500,000,
was an error of law. Liability assumed
causation, and causation should have been
assumed on the proper construction of the
rule.
4. However, it was quite possible that the
master would have come to the same
conclusion as to the level of damages had he
not made such an error. It was therefore
appropriate to remit the application to the
master for determination assuming that
liability and causation had been established
and the claim awarded.
Comment: The full judgment is not yet available
but the Lawtel summary indicates that the Court
of Appeal upheld the High Court’s findings in all
material respects. This decision is now of historic
interest save for those claims funded by a pre
April 2013 CFA. It is however a sensible decision
and it would be prudent in pre April 2013 claims
to make a CPR r.45(18)(2) application at an early
stage where the damages appear likely to exceed
£500,000 on full liability. [Deirdre Goodwin]
____________________
(Continued from page 23)
Road Traffic - Part 36 - CFA continued
January 2014 Page 24
January 2014 Page 25
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Deirdre Goodwin [Team Leader]* 1974 Alexander Dawson* 1969 Anthony Higgins 1978 Charles Scott* 1980 Neil Vickery 1985 Mark Maitland-Jones* 1986 Sinclair Cramsie* 1988 Adrian Higgins* 1990
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