Always reliable and accurate, with a good turnaround speed.
Paul Bunting, Partner, Aspinall Wright Solicitors
This last year has been a period of significant change, or certainly warning of proposed changes to come very shortly, in relation to legal costs. This letter sets out a few points that may have slipped your attention with all of the major upheaval which has been well covered by numerous articles. Nevertheless they are matters that may assist you and your clients to maximise your costs recovery.
With regard to Part 36 offers the case of Susan Gibbon v Manchester City Council (2010) EWCA Civ 726 clarified the important point that Part 36 offers remain open until formally withdrawn (Rule 36.9(2)). In this particular case the Claimant made an early counter offer to settle which was not accepted by the Local Authority who subsequently made two further settlement offers which were rejected by the Claimant. The Defendant then accepted the original offer of the Claimant as it had not been withdrawn, but the Claimantï¿½s solicitors sought to withdraw the offer. The Court of Appeal concluded that the offer was still capable of acceptance despite the lapse of time and subsequent offers.
Another Part 36 issue was addressed in the matter of PGF II SA v Royal & Sun Alliance (2010) EWHC 1981 (TCC). Each party had made Part 36 settlement offers, but the case proceeded to trial at which judgment was given in favour of the Claimant for a sum just above the Defendantï¿½s Part 36 offer, but substantially less than the Claimantï¿½s Part 36 offer. HHJ Toulmin CMG QC concludedï¿½.. ï¿½I do not find that the Claimantï¿½s costs should be reduced by reason of the fact that they recovered very significantly less than their Part 36 offer or the Defendantï¿½s Part 36 offers were closer to the final result. I can find no precedent or justification for this.ï¿½
Small Claims ï¿½ pre allocation: A decision in the spring confirmed the position with regard to low value claims settled pre-allocation. In the case of Oï¿½Beirne v Hudson (2010) EWCA Civ 52 a consent order was agreed for costs to be paid on the standard basis. This was a road traffic accident claim with ï¿½400 agreed for general damages and ï¿½719.06 agreed for hire charges. The Court of Appeal found, in light of the consent order for costs to be assessed on the standard basis, that the Costs Judge could not make an order that costs would be assessed on the small claims track, with consequent fixed costs. Nevertheless, the Costs Judge may take account of all circumstances (CPR 44.5(1)) and whether it is reasonable for the paying party to pay more than would have been recoverable in a case allocated to the Small Claims Track. This may include considering whether the paying party should pay the costs of a lawyer (unnecessary on the Small Claims Track)!
Finally a point concerning the use of non-local solicitors. Wraith v Sheffield Forgemasters (1998) is often relied upon as an authority for restricting hourly rates to those of a court local to the Claimant, rather than higher city centre rates in cases where the solicitor is so located. In the case of Higgins v Ministry of Defence (2010) EWHC 654 (QB) the Claimant was an 82 year old man suffering with asbestosis and had a very limited life expectancy. Mr Higgins lived in Broadstairs, Kent, but Central London solicitors had been instructed. The Defendant sought to limit costs allowed to those that would have been allowed if the solicitors instructed were based more locally to the Claimantï¿½s home. It was held that it would be unreasonable to expect the Claimant to explore comparable hourly rates for solicitors, in particular given the urgency of the matter and the age of the Claimant. Perhaps the important point here is that the emphasis is on whether it was reasonable for the client to consider a range of solicitors in light of his own personal circumstances.