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Bulk of Claimant's costs limited to FRC following Court's ruling that only the trial period was reallocated to the Multi-Track

04 November 2019
In the matter of Mayal Qaumi v Brian Noah (1) and Tesco Underwiritng Ltd (2), Polly Barker successfully argued that the Claimant's costs should be limited the fixed recoverable costs ('FRC') up until the point at which the matter was reallocated to the Multi-Track and only from the point of reallocation can the Claimant recover standard basis costs.

Facts of the case

This was a road traffic accident claim where DWF were representing the Second Defendant. The accident occurred on 28th February 2015 and was caused by the First Defendant driving in to the back of the Claimant's vehicle. The First Defendant was found to be intoxicated, driving whilst disqualified and driving without insurance and the Second Defendant was brought in as a party to the proceedings.

Following DWF's instruction, the Claimant issued proceedings and the matter was subsequently allocated the the Fast Track. As a settlement wasn't reached, the case proceeded to Trial on 3rd March 2017 but was adjourned until 8th May 2017 to allow the Claimant's expert to answer the Defendant's Part 35 questions. On 8th May, the trial was only part-heard due to the Claimant's extensive cross-examination and concluded on 5th June in favour of the Claimant. Points 2 and 3 of the order read as follows:

"2. The matter is re-allocated to the Multi Track with effect from (and including) 8 May 2017.

3. The Defendants shall pay the Claimant's costs to be assessed in absence of agreement."

Costs Proceedings

Upon conclusion of the substantive claim, the Claimant served a Bill of Costs totalling £41,954.01 and on the standard basis. It was the Defendant's position that the order following trial reallocated only the trial period to the Multi-Track i.e. from 8th May 2017 onwards, and so FRC were payable up until 7th May 2017 as this remained in the Fast Track and standard basis costs were payable thereafter. The Defendant referred specifically to the wording of the order dated 5th June 2017 and relied upon Part 46.13 of the Civil Procedure Rules which states:

"(2) Where -

(a) claim is allocated to a track; and

(b) the court subsequently re-allocates that claim to a different track,

then unless the court orders otherwise, any special rules about costs applying –

(i) to the first track, will apply to the claim up to the date of re-allocation; and

(ii) to the second track, will apply from the date of re-allocation."

The Defendant submitted that in this instance, it was reasonable and proportionate to award fixed costs up to 8 May 2017 (as per the order dated 5 June 2017), and standard basis costs thereafter to allow for Counsel's brief and refresher fee, plus nominal costs of updating the Claimant between hearings and dealing with the outcome and damages payment to conclude. 

The Defendant further stated that this case was always suitable for the Fast Track and was in fact allocated to the Fast Track up until the 7th May 2017 when, due to the lengthy cross examination of the Claimant, the trial period only was reallocated to the Multi Track. As such the matter was always considered to be and was at all times, barring the final hearing, dealt with as a claim subject to FRC and in which no party – the Claimant included – expected anything other than the fixed recoverable costs to apply.

The Defendant argued that the case was not overly complicated and was not high in value, being well inside the fixed recoverable costs threshold for damages, which could be seen from the sums awarded to the Claimant at trial.

The Claimant refuted the Defendant's submissions and argued that merely allocating a case to the Multi Track results in FRC ceasing to apply. The Claimant relied on Civil Procedure Rule 45.29B which states as follows: 

"Subject to rules 45.29F, 45.29G, 45.29H and 45.29J, and for as long as the case is not allocated to the Multi Track, if in a claim started under the RTA protocol…. the only costs allowed are –

a) The fixed costs in rule 45.29C;

b) Disbursements in accordance with rule 45.29I"

The Claimant also referred to the case of Qadar v Esure (2016) wherein LJ Briggs states:

"I have come to the conclusion that section III A 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.".

The Claimant concluded that when a matter is allocated to the Multi-Track 'for whatever reason', standard basis costs apply.

Court findings and conclusion

Given the parties' respective procedings, the matter proceeded to a Provisional Assessment of costs which was heard by District Judge Severn sitting at Leicester County Court. DJ Severn found in favour of the Defendant and stated that:

"The order of 5th June 2017 is clear and unambiguous. Fast track to 7th May 2017. Multi Track from 8th May 2017.The case which was referred to by the Claimant was one which was allocated to the Multi Track upon allocated. The present case was allocated to the Fast Track and remained there until Trial. The reallocation order is specific as to the date from which it applies."

The Claimant was awarded FRC totalling £12,737.58 (inclusive of VAT) plus £5,558.40 on the standard basis making a total of £18,295.98. This is a reduction of 56% or £23,658.03 against the total costs claimed (£41,954.01). The parties have now filed submissions regarding the costs of assessment and the outcome is awaited from the court.