England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM PLYMOUTH COUNTY COURT
(His Honour Judge Overend)

		Royal Courts of Justice Strand London WC2 Tuesday 13 March 2001

Tuesday 13 March 2001

1. THE VICE-CHANCELLOR: This is the appeal of Mr Simon Richard Edwards, brought with the permission of Sir Anthony McCowan, from the summary assessment of costs conducted by His Honour Judge Overend quite late in the day on 1 December 1999. He assessed the costs of Mr Edwards in respect of the claim at £2,500 including VAT, and costs of the defendant's, Devon and Cornwall Constabulary's, counterclaim at £750 including VAT. Setting one off against the other, he ordered the Devon and Cornwall Constabulary to pay the sum of £1,750 to Mr Edwards.
2. The appellant, Mr Edwards, contends that the judge failed to carry out the appropriate procedure, and that he should not have been engaged on summary assessment at all. To explain how that comes about, I shall have to describe the background events in more detail.
3. The claim concerned the consequences of a motor accident in which Mr Edwards' wife, Erica Louise Edwards, was involved on 27 October 1995. She was then some 23 years of age. She was struck from behind or on the side by a police car which was sounding its siren and flashing its lights from behind her. She was in the outside lane. She moved to the left, having failed properly to estimate the speed at which the police car was moving, and was run into by the police car. She sustained whiplash injuries.
4. She was first examined by Mr Anderson on 31 May 1996 (that is to say, some seven months after the accident) when she was found also to be some seven months pregnant. He suggested that there should be a second examination after the birth of the child, so as to determine more clearly the effect of the pregnancy on the back pains that she suffered and to separate that from the effects of the car crash. The second examination took place on 21 April 1997.
5. In the meantime, in November 1996, she was unfortunately diagnosed as having a cervical cancer from which she subsequently died. After the second examination carried out by Mr Anderson he wrote a report recording (page 13 of the bundle):

"I remain of the opinion that Mrs Edwards has sustained an injury of the soft tissues of the neck of the type commonly referred to as whiplash. It is now eighteen months from injury and her symptoms have not really settled. It is therefore likely she is going to fall into the group which gets on-going discomfort in the neck for an unpredictable period of time although these symptoms will not spontaneously worsen. This accident will not lead to the development of spinal degenerative disease. I feel that while Mrs Edwards may experience discomfort after physical exertion or prolonged sitting with a stooped posture, these symptoms will not greatly limit her activities either socially or in terms of employment prospects. The main long term effect of this injury is that if she was involved in a similar accident in the future she would experience more severe and more prolonged discomfort than had she not been injured in this accident.

As far as the symptoms in her low back are concerned they appear to have started some time following the accident and are more likely to be associated with pregnancy than injury. I do not believe they are relevant to this report."

6. In the light of that report Mrs Edwards commenced proceedings in Plymouth County Court on 9 April 1998. She sought damages as a consequence of the accident, which she ascribed to the negligence of the Devon and Cornwall Constabulary, in a sum between £5,000 and £50,000. In May 1998 the Devon and Cornwall Constabulary served a defence and counterclaim alleging negligence on the part of Mrs Edwards in failing to take sufficient notice of the police car and failing sufficiently to indicate her intention. The counterclaim was for the insurance excess of £250 and the loss of the use of the police car for the period during which it was off the road.
7. As I have already indicated, Mrs Edwards unfortunately died on 31 May 1998. Her husband was joined as the claimant in her place and appropriate orders to carry on were made. Matters proceeded at a somewhat leisurely pace. General damages were agreed in May 1999, but subject to liability, in the sum of £3,750. The counterclaim for £250 was agreed in October 1999 and on 8 November 1999 the claimant received a Part 36 offer from the Devon and Cornwall Constabulary, apportioning the liability between Mrs Edwards and themselves at 75 per cent and 25 per cent.
8. There were offers to settle. The first was from the claimant for £3,000 plus costs on 23 November. On 25 November the Devon and Cornwall Constabulary offered £5,000 inclusive of costs. On 26 November Mr Edwards submitted a schedule of special damages for £5,721.48. That was countered by a counter schedule served on 29 November agreeing special damages on the claim at £351.15 and on the counterclaim, subject to liability, at £350. Eventually liability was agreed at 25 per cent on the claim and 75 per cent on the counterclaim. Then on the following day, 30 November, the Devon and Cornwall Constabulary offered £1,091.48 on the claim and indicated that they would accept £297.59 on the counterclaim.
9. That was the state of play when the matter came before His Honour Judge Overend on 1 December 1999. His list was running somewhat late, and the matter was not called on until about 3.30 pm. The outstanding issue was pared down to how much, if anything, should be allowed for care for Mrs Edwards during the period for which care was required as a consequence of the accident rather than as a consequence of the pregnancy.
10. The judge heard argument on both sides. He reached a conclusion, as recorded in the transcript, that care should be allowed for a particular period at a particular rate. He invited the parties to make the appropriate calculations. Counsel for the claimant indicated that, if the judge would give them a moment, they could quickly calculate the additional element. At that point the transcript stops. It recorded that the matter was adjourned for a short time, and it is apparent from when the transcript starts again that the recording had failed to pick up quite a lot of what had happened in between. The omission is supplied by the claimant's solicitors's note, from which I will paraphrase the relevant parts.
11. After the short adjournment the parties returned to the court. Counsel for the claimant stated that liability had been settled at 25 per cent for the claim and 75 per cent for the counterclaim, and he produced a computation of £1,429.67 on the claim and £297.59 on the counterclaim. The judge indicated that he would deduct one amount from the other and award the claimant £1,132.08. Counsel for the claimant then asked the judge to order the defendant to pay the claimant's costs of the action, including that day's hearing, and also that the claimant pay the defendant's costs on the counterclaim on the liability issue up until 29 November 1999, the date on which the Part 36 offer was accepted by the claimant. Counsel indicated that in his submission the only reason they were in court at all that day was because the care claim had to be decided and in that respect the claim had been successful. Counsel for the claimant indicated that costs schedules had been prepared but that this was not one of the most straightforward cases to assess because there would be different parties to pay the costs of the claim and costs of the counterclaim.
12. I interpose at that stage to indicate that the explanation for that is that the cost of the claim was covered by a conditional fee agreement, but the costs of defending the counterclaim were covered by Mrs Edwards' motor insurance.
13. Continuing with the note of the proceedings, it records that the judge interrupted by saying, "It's a small claim, isn't it?" Counsel for the claimant responded that it had never been put forward as a small claim and until that week over £5,000 had been claimed by the claimant. The judge observed that the claimant had been awarded just over £1,000 and should not get any costs. Counsel for the claimant responded that no court would have ordered the claim to be transferred to the small claims court. It was a transitional case and should be decided on the basis of the old rules.
14. Again I interpose to observe that the note does not record at any stage that counsel for the claimant had invited the judge to refer the question of costs to a detailed assessment. During the course of submissions this morning counsel told us (and it was accepted by the other side so I accept it too) that he did make that submission, but it was not recorded in the solicitor's note.
15. Continuing with the note, as supplemented by a subsequent letter from the defendant's solicitors, the judge said that at the highest this was a fast track claim and he intended to summarily assess the costs. He then, records the note, turned to counsel for the defendant, who made certain submissions on the claimant's bill of costs to the effect that attendances on the client were excessive. He observed that the claimant had produced only two statements, one very short, and only recently was it necessary to go to the claimant for instructions. The observation was made that there were an extraordinary number of telephone attendances. Counsel for the defendant drew a parallel with fast track costs. The note concludes with the judge saying that the claimant's telephone calls were excessive and awarding £2,500, including VAT. None of that is recorded on the transcript.
16. Continuing with the transcript, it records that there was no record of the proceedings at that point. It then continues by recording the judge as stating: "It seems to me that it is a wholly excessive claim, and I had in mind £2,500 inclusive of VAT." Counsel for the claimant then asked the judge if he might come back to some of the points made by his opponent on the claimant's bill. The judge said:

"No, I do not think so. I think that is wholly out of proportion to the eventual result. Seven and-a-half thousand for £1,100. I think I am hard pushed to allow you two and-a-half thousand including VAT. Yes. What about the other one?"

17. That I take to be a reference to the defendant's bill of costs on the counterclaim. Counsel for the claimant would not have that. He maintained, and said:

"Your Honour, I simply have to say, this was not the most straightforward of cases right from the start. It has had its complications with - as I say - the death of the original claimant. There has also been, within those attendances with the client - that also includes, on the other---"

18. The judge interposed: "Are you coming back on the question of the £2,500?" Counsel confirmed that he was. The judge observed that he had decided that, to which counsel said, "Very well". The judge continued: "Yes. And on the other one on the issue of liability, claimant's costs?" And counsel for the claimant asked, "Can I just confirm - was that £2,500 - that was the solicitors' cost?" To which the judge observed, "That is the total allowed on summary assessment of £2,500, including VAT, and the lot." Counsel for the claimant then asked about disbursements, pointing out that Mr Anderson had been brought to court that day at the defendant's request. To which the judge responded: "That is why you have £2,500. It would have been less otherwise." Counsel persisted that the consultant had had to see the claimant twice and to prepare those reports, to which the judge observed:

"I am sorry, I have told you now twice, I have ruled on that one. If I have to tell you a third time I will shut you up completely. Right. Now, what about the other..."

19. The discussion then continued, so far as is relevant, in respect of the costs of the counterclaim.
20. The upshot was therefore that the claim was successful in the sum of £1,429-odd. The counterclaim was effectively agreed at £297.59. The bill of costs of the claimant's solicitors, which had been submitted in the sum of nearly £7,900, was reduced to £2,500 and the costs to Devon and Cornwall, which had been submitted in the sum of £2,500, was reduced to £750.
21. As I have indicated, permission to appeal was granted by Sir Anthony McCowan. On behalf of the claimant/appellant Mr Tavares has made two points. He says first that the judge should not have been engaged in a summary assessment at all; and, second, if he was, he should not have conducted it in the way that he did, broadly speaking, because, first of all, he did not allow counsel to address him on it fully and, secondly, because he reached a conclusion which was arbitrary and without reference to the constituent elements in the bill.
22. Both of those points are challenged by counsel for the defendant. But counsel for the defendant frankly accepts that the claimant's counsel was not given the opportunity that he should have had to deal with the details of the bill of costs his client had submitted, and which had been extensively criticised by the other side.
23. In those circumstances, it is not necessary to go into any great detail on the other points. But for the sake of completeness, and because they have been fully argued before us, I will indicate my views.
24. The first question is whether or not the judge should have carried out a summary assessment at all. At the time the matter came before the judge, the matter was regulated by CPR Rule 44.7. That provided that:

"Where the court orders a party to pay costs to another party (other than fixed costs) it may either -

(a)make a summary assessment of the costs; or

(b)order detailed assessment of the costs by a costs officer

unless any rule, practice direction or other enactment provides otherwise."

25. The practice direction then in force provided in paragraph 13.1 that:

"Whenever a court makes an order about costs which does not provide for fixed costs to be paid the court should consider whether to make a summary assessment of costs"

and in 13.2, the general rule is stated to be that:

". . . the court should make a summary assessment of the costs . . .

(2)at the conclusion of any other hearing, which has lasted not more than one day, in which case the order will deal with the costs of the application or matter to which the hearing related."

26. At that time paragraph 13.2(2) stopped at that point. Since then the practice direction has been amended so that it now adds a further sentence to this effect:

"If this hearing disposes of the claim, the order may deal with the costs of the whole claim".

27. The point is made that at the time the matter came before the judge the practice direction did not require him as a general rule to carry out a summary assessment. Given the size of the claim and the difficulties to which counsel had referred, it is suggested that the judge was wrong to carry out the summary assessment at all.
28. For my part, I do not take that view. It seems to me that the matter was entirely a matter for the judge's discretion. The hearing had been short, the amount of money involved was small, and the complications were by no means insurmountable. The bills of costs submitted were simple and straightforward. The judge was seeking to reduce the costs by carrying out an assessment on the spot so as to avoid either a further attendance before him or the additional costs incurred in making a detail assessment. It is quite plain from what happened that both parties thought the costs were going to be assessed summarily, because they produced bills for that purpose. That is what the judge tried to do, and in my view the exercise of his discretion cannot be assailed.
29. On the second point, the question is whether the judge got the assessment wrong. I approach that on the footing, as conceded, that counsel for the claimant did not have an adequate opportunity to address the judge on his own client's bill of costs. Had he done so, I have little doubt that he would have drawn to the judge's attention the fact that mathematically the judge's disallowance of the attendance costs of the solicitors (which was the only item he thought required downward assessment) had the consequence that he allowed the solicitors £627 only for conducting the entire proceedings since they were instituted in April 1998.
30. I understand that it is generally accepted that solicitors for the claimant in a personal injury case are likely to incur more costs than those for a defendant. In addition, in this case there were the extra costs involved due to the unfortunate death of the claimant. It seems to me, therefore, that it can be seen that the failure to give counsel an adequate opportunity to address the judge on his own client's bill of costs may well have led to substantial injustice because, on the face of it, £627 is quite inadequate for costs incurred in even the most economical conduct of litigation such as this.
31. The question then arises what to do about it. The notice of appeal seeks a detailed assessment of costs but that, it seems to me, would increase the costs, perhaps unnecessarily and certainly disproportionately to the amount of the claim and the amount of the costs to date. For my part I would at this stage allow the appeal and invite the parties' solicitors to attempt to agree the costs as though there were an assessment now. If they are unable to do so within a period of some 30 minutes we shall then sit again for the purpose of ourselves carrying out a summary assessment in order to avoid the further costs which would be incurred if we sent the matter for detailed assessment.
32. LORD JUSTICE ROBERT WALKER: I agree.
ORDER:Appeal allowed. By agreement an order that the respondent pay the claimant £4,523.91 be substituted for the order below. Devon and Cornwall Constabulary to pay the whole of the costs of the appeal incurred by the appellant. On summary assessment of those costs the solicitors charges are reduced from £4,235 to £3,000 (the reduction being made proportionately to the totals of personal attendances, telephone attendances, work on documents and travelling but no reduction being made to disbursements) with the consequent adjustment to VAT. (Order not part of approved judgment)