Over the last year or two a common issue in regards to costs in RTA litigation has presented itself at the allocation stage: whether the fixed costs regime continues to apply to a case which no longer continues under the RTA Low-Value Personal Injury Protocol but is allocated to the multi-track after being issued under Part 7.
Claimants found themselves arguing that the fixed costs regime did not or should not apply to matters that were allocated to the Multi Track. Defendants, keen to take advantage of the obvious costs savings, made the reverse argument. In support, since October 2015, Defendants pointed to the judgment of HHJ Grant, sitting in the County Court in Birmingham, in Qader, at the first appeal stage. Whilst the decision (that the fixed costs regime continues to apply to matters that had exited the Protocol and had subsequently been allocated to the Multi Track) did not seem to sit comfortably with the very notion behind the fixed costs regime - that it applies to modest road traffic accident personal injury claims - it was hard to disagree with the properly formulated decision of HHJ Grant, who applied the rules as they had been drafted.
The Court of Appeal felt that the issue ‘required the court not merely to interpret the relevant provisions, but to consider whether they suffer from an obvious drafting mistake which can be put right so as to bring them into compatibility with the intention of the relevant legislator, namely the Civil Procedure Rule Committee, pursuant to the court’s exceptional jurisdiction to do so as explained by Lord Nicholls in Inco Europe Limited v First Choice Distribution  1 WLR 586, at 592’. In fact, the Court of Appeal decided exactly that – there had been an obvious drafting mistake.
Section IIIA of CPR 45.29 makes provision for claims that start under the Protocol but then exit it. CPR 45.29B provides that ‘Subject to rules 45.29F, 45.29G, 45.29H and 45.29J, if, in a claim started under the RTA Protocol, the Claim Notification Form is submitted on or after 31st July 2013, the only costs allowed are the fixed costs in rule 45.29C.’ On the face of it therefore, it would seem unambiguous that only fixed costs are recoverable to a claim that started within the Protocol, regardless of the size or complexity of the claim. Not so, viewed the Court of Appeal.
In a judgment delivered by Lord Justice Briggs it was ruled that section IIIA of Part 45 should be read as if the fixed costs regime, which it prescribes for cases which start within the RTA Protocol but then no longer continue under it, is automatically dis-applied in any case allocated to the multi-track. Careful analysis of the historic origins of the scheme now enshrined in section IIIA of Part 45, and in particular the process of consultation which preceded it, demonstrated that it was not in fact the intention of those legislating for this regime in 2013 that it should ever apply to a case allocated to the multi-track. A conclusion that it should so apply is a result which can only have arisen from a drafting mistake, which the court had the power to put right by way of interpretation, even if, as here, that required the addition of words rather than giving the words actually used a meaning different from their natural and ordinary meaning.
Consequently, CPR 45.29B should now read ‘Subject to rules 45.29F, 45.29G, 45.29H and 45.29J, and for so long as the claim is not allocated to the multi-track if, in a claim started under the RTA Protocol, the Claim Notification Form is submitted on or after 31st July 2013, the only costs allowed are the fixed costs in rule 45.29C’
The corollary of this decision will not be lost on practitioners. Defendants will now be less inclined to agree to allocation, or reallocation, to the multi-track as they may have been in the past year or two. The danger for defendants is where they do not agree to allocation to the multi-track in circumstances where they probably ought to – defendants could end up paying the costs of contested allocation hearings.
Insofar as claimants are concerned, they will obviously be more likely to seek allocation to the multi-track. However, of greater significance in the short term might be the risk of claimants returning to court seeking an order dis-applying the fixed costs regime. This is likely in claims that have recently been allocated to the multi-track along with an order that fixed costs apply to the claim. One may speculate that the greater the period between such an order and a claimant applying for the disapplication of fixed costs, the less likely the claimant’s application is to succeed.
If a lot of work has already been done since the order, it is difficult to see how a new costs regime could be applied retrospectively. What is not in doubt is that the decision in Qader is likely to result in less inter-partes agreement at the case management stage and longer, more contested, case management conferences.
Bernard Pressman / 16th Nov 2016
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