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No additional costs payable for application to enter judgment

16 July 2021

Simon Fisher discusses a DWF case proceeding under the fixed recoverable costs regime, where we successfully argued against hourly rate costs for an application to enter judgment following a Part 36 settlement. The claimant's solicitors were also joined into the proceedings for the purpose of seeking a non-party costs-order.

 

Roberts v RSA (Chester County Court, HHJ Skyes)

Background 

The claimant submitted a Claims Notification Form via the MOJ Portal following an accident in March 2017. The matter subsequently exited the Portal and Part 7 proceedings were issued. Negotiations ensued between the parties and the claimant accepted a Part 36 offer of £6,000 made by the defendant.
Fourteen days after the settlement, and without further reference to the defendant, the claimant made a without notice application to the court, and obtained an order for judgment to be entered for the claimant's damages and payment of the relevant fixed costs and disbursements. They also sought and obtained an order for the costs of the application to be assessed if not agreed.

The defendant's application

Upon receipt of the order the defendant applied to set aside the costs order allowing the claimant the costs of the application. Deputy District Judge Poyner dismissed the defendant's application, finding that fixed costs apply up to settlement, and thereafter costs are at large as a form of sanction for defendants who do not pay on time.

The appeal

The defendant appealed, arguing that this was simply an application to enter judgment so no further costs, save for the court fee, could be payable as a matter of law. The claimant argued that this issue was not a matter to be dealt with on appeal, but rather because an order for the costs to be assessed had been made, it should be dealt with at detailed assessment.

The appeal court dismissed the claimant's argument that the determination of the application of fixed costs should be left to detailed assessment, finding that an order for detailed assessment was conceptually different, and not compatible with the fixed costs regime. Following that finding the court made a determination that no costs were payable in such applications because they were caught within the fixed costs already awarded, and there was no jurisdiction to allow costs at large

Additional issues arising from this appeal

Third party costs order

The claimant's solicitors were joined into proceedings for the purpose of the defendant seeking a Third Party Costs Order.

Exceptional circumstances

It is noteworthy that the court found that any exceptions to fixed costs would have to come before the making of a costs order. To do otherwise would build into the fixed costs regime a cumbersome, expensive and uncertain stage of detailed assessment, conceptually at odds with the whole purpose of the intention that fixed costs regime.

What does this appeal mean for insurers and others who are regularly paying parties?

It is hoped that this appeal will bring an end to applications of this nature. Should such applications be made in future, insurers are advised to apply immediately to set aside any order for costs made in the claimant's favour and seek their own costs (the defendant's costs payable under CPR r. 45.29F).

In addition, where it can be shown that the real beneficiaries of costs litigation are the legal representatives, a third-party costs order should be sought for those representatives to pay the defendant's costs, noting that those representatives do not benefit from the claimant's QOCS protection. 

Comment

A final takeaway point is that any claims, where a claimant is seeking standard basis costs that are caught by Part IIIA of CPR 45 but a costs order has already been made, should be opposed on the basis that it is too late to now seek anything other than fixed costs. This is especially true where a Part 36 offer has locked the parties into the relevant stage of fixed recoverable costs. 

DWF have successfully opposed several of these types applications, and have successfully appealed twice. Furthermore, DWF have also had success in striking out Part 8 Proceedings that have been issued prematurely.

Further Reading

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