England and Wales Care Standards Tribunal

 


Bannister & Anor v Commission for Social Care Inspection [2005] 0507.EA_Costs) (26 February 2006)

Mr A Bannister and Mrs R Bannister

Applicants

and

The Commission for Social Care Inspection

Respondent

[2004] 0414.EA-JP

[2004] 0415.EA-JP

[2005] 0507.EA

[2005] 0510.EA

Before:

Mrs Meleri Tudur (Chairman)

Ms Marilyn Adolphe

Mrs Susan Last

Hearing date: 20^th February 2006

DECISION

Representation

Ms Tracey Lucas of Bevan Brittan Solicitor, represented the Commission for Social Care Inspection

Mr and Mrs Bannister were present and unrepresented.

Application

An application by the Respondents for a costs order against the Appellants pursuant to Regulation 24 of the Protection of Children and Vulnerable Adults and Care Standards Tribunal Regulations 2002 ("The Regulations").

Background

1. The Applicants, Mr and Mrs Bannister, were the registered providers of Silverlands Residential Care Home, Silverlands Avenue, Oldbury, West Midlands, ("the Home") and Mrs Bannister was the Registered Manager of the Home.
2. The Respondent took over responsibility for the regulation of the Home under the Care Standards Act 2000 on the 1^st April 2004.
3. On the 28^th October 2004, as a result of a number of concerns being raised by inspectors and other professionals about the standards of care within the Home, the Respondents wrote to the Applicants informing them that they should inform the CSCI of the details of a management consultant appointed to run the Home from the 1^st November 2004.
4. At a meeting on the 3^rd November 2004, the Applicants informed the CSCI that they had been unable to secure the services of a consultant to take over the running of the Home. The Applicants were notified that the Respondents would make an emergency application to a Justice of the Peace (JP) for an order that the registration of the Home be cancelled unless a manager was in post within 24 hours.
5. The Applicants failed to secure such an appointment.
6. On the 4^th November 2004, the CSCI made an application to Mr Andrews, JP, for the registration of both providers to be cancelled. Following a hearing on the same day where evidence was called, Mr Andrews, JP, decided that unless the order was made, there would be a serious risk to a person's life, health or well-being and he made an order under Section 20 of the Care Standards Act 2000, cancelling Mr and Mrs Bannister's registration in respect of the Home.
7. Appeals against the orders were submitted to the Care Standards Tribunal by Mr and Mrs Bannister on the 4^th December 2004. The Respondent filed a formal Response to both appeals on the 4^th January 2005.
8. On the 4^th March 2005, His Honour Judge Pearl gave directions for the appeals against urgent cancellation. A direction for disclosure of documents by the 1^st April 2005 was, by agreement between the solicitors acting for both parties, extended by seven days.
9. On the 6^th May 2005, the Respondents adopted a Notice of Proposal to cancel both the Applicants' registration under Section 14(1) (c) of the Care Standards Act 2000.
10. Mr Bannister filed his Notice of Appeal under Section 21 of the Care Standards Act on the 2^nd June 2005 and an order for Directions was made on the 7^th June 2005, based on the assurance of the Applicants' solicitor that Mrs Bannister's Notice of Appeal would be filed by the 10^th June 2005. Mrs Bannister's Notice of Appeal wasn't lodged with the Tribunal until the 16^th June 2005.
11. The Respondent lodged the responses to the appeals on the 1^st July 2005.
12. Included in the directions made on the 7^th June 2005, was an order for disclosure of all relevant documents or materials by the 22^nd July 2005. The Applicants' solicitor again notified the Respondent's solicitor prior to the date specified in the direction that he would be unable to comply with the deadline and proposed an amended timetable for the conduct of the appeal.
13. During July and August, there were communication problems between the Applicants' and Respondent's solicitors and at the hearing, the Tribunal heard that Bevan Brittan, acting for the Respondent, found it extremely difficult to contact Mr Sutton of Rowe Cohen in Manchester, who was representing the Applicants.
14. An amended timetable was eventually agreed between the parties as to disclosure and exchange of witness statements and the Tribunal made an order extending the time for exchange of witness statements to the 9^th September 2005.
15. On the 15^th September 2005, when the witness statements had still not been received from the Applicants, the Respondents' solicitors made an application to the Tribunal for the issue of an "Unless Order" to be made dismissing the appeals unless the witness statements were disclosed by 5pm on Friday 16th September 2005. The Applicants' statements were received on the 16^th September 2005, before an order was made.
16. On the 12^th September 2005, the Respondent sent a brief to Counsel to commence work in preparation for the Tribunal hearing scheduled for the 10^th October 2005 for 15 days.
17. On the 29^th September 2005, the Respondent's solicitors sent to the Tribunal four copies of the Tribunal Bundle prepared for the hearing, consisting of nine Level Arch files of documents, fully paginated and indexed.
18. On the 5^th October 2005, the Applicants' solicitors contacted the Respondent's solicitors to inform them that there was a possibility that the applicants' appeals would be withdrawn.
19. At 7.30pm on the 6^th October 2005, the Applicants' solicitor contacted the Respondent's solicitors to confirm that the Applicants had decided to withdraw their appeals. The withdrawal was confirmed by letter faxed on the 7^th October 2005.
20. His Honour Judge Pearl made an order dismissing all the proceedings in the matter on the 10^th October 2005.
21. The Respondent's solicitors made an application for costs pursuant to Regulation 24 of the Regulations, on the 25^th October 2005. The President of the Tribunal issued directions on the 24^th January 2006, requiring the Applicants to file information regarding their financial situation and to file representations in accordance with Regulation 24(2) (a).
22. The Respondents filed with their application a Schedule of Costs for the period from August 2005 to the 10^th October 2005, for costs incurred by them totalling £61 995.25.

The Law.

23. The relevant provisions of the Regulations relating to costs orders are contained in Regulations 33 and 24.
24. Regulation 33(1) provides that:

"If the Applicant at any time notifies the secretary in writing or states at a hearing that he no longer wishes to pursue the proceedings, the president, the nominated chairman (or at the hearing the Tribunal) must dismiss the proceedings and may subject to Regulation 24 make a Costs order."

25. Regulation 24 states:

"(1) Subject to Regulation 31 and to paragraph (2) below, if in the opinion of the Tribunal a party has acted unreasonably in bringing or conducting the proceedings, it may make an order (a costs order) requiring that party (the paying party) to make a payment to the other party (the receiving party) to cover costs incurred by the receiving party.

(2) Before making a costs order against a party, the Tribunal must:-

(a) Invite the receiving party to provide the Tribunal with a Schedule of Costs incurred by him in respect of the proceedings; and

(b) Invite representations from the paying party and consider any representations he makes, consider whether he is able comply with such an order and consider any relevant information he has provided."

26. Regulation 31 is not relevant to the present case.
27. The Regulations therefore identify the following procedure for making an order for costs:

i) Once the Applicant withdraws the appeal, the Tribunal must dismiss the appeal and may make an order for costs.

ii) In deciding whether to make a costs order, the Tribunal must:

(a) be satisfied that the paying party has acted unreasonably in bringing or conducting the proceedings;

(b) invite the receiving party to prepare a schedule of costs; and

(c) consider representations from the paying party and

(d) consider whether the paying party is able to comply with such an order and

(e) consider any relevant information that the paying party has provided.

28. Other decisions made by the Tribunal, specifically those of Funcamps Limited v OFSTED [2003] 124 EY and Mr and Mrs Gibson –v- The Commission for Social Care Inspection [2004]265 and 266 EA, have confirmed that the test for deciding whether a party has acted unreasonably is a high one.

The Application

29. The Respondent's application for costs was made on the basis that the Applicants had conducted the appeals unreasonably in not withdrawing their appeals at an earlier stage. It was submitted that it was wholly unreasonable for the Applicants to have withdrawn their appeal on the last working day before the final hearing, which was listed for three weeks.
30. It was submitted that it would have been reasonable for the Applicants to have reviewed the merits of their case to decide whether or not to continue with their appeals within two weeks of receipt of the Respondent's evidence. If the original directions given on the 7^th June 2005 had been complied with, the witness statements would have been exchanged on the 12^th August 2005. If the evidence had been properly reviewed at that stage, it was submitted that the Applicants, if acting reasonably, would have been in a position to withdraw their appeals by the 26^th August 2005. The first part of the application was therefore for costs from the next working day after the 26^th August 2005, namely the 30^th August 2005.
31. The alternative application was that, on the basis of the Applicants' delay in disclosing their documentation to the Respondent, the Respondent's disclosure of its witness statements was delayed and that at the very latest, the Applicants should have been in a position to withdraw the appeals no later than two weeks after the receipt by them of the Respondent's witness statements on the 9^th September 2005, which would have led to the withdrawal being made by the 23^rd September 2005. The second limb of the application was that costs should be awarded from the next working day after that, which was the 26^th September 2005.
32. The Applicants were not legally represented in the application for costs. They prepared a bundle of documents for the Tribunal, detailing their disagreement with the CSCI's summary of the case and setting out their objections to the application for costs.
33. The Applicants submitted that they had not conducted the case unreasonably in not withdrawing their appeals sooner because they had not received a copy of the paginated bundle of documents at all, and had not received copies of the Respondent's witness statements. They stated in their submission that they had received from their Counsel in Birmingham, on the 12^th September 2005, only four Lever Arch files, which were not paginated and which did not contain any witness statements.
34. Mr and Mrs Bannister were adamant that they had never intended to withdraw the proceedings, believing that they had a good defence to the cancellation proposal and intending to present the case at the hearing. They submitted that the issue of withdrawal wasn't suggested to them by their legal advisers until the 5^th or 6^th October 2005, when their solicitor informed them that the insurance company might withdraw its financial backing from the case.
35. In their written submissions, the Applicants explained the chain of events which had occurred from the lodging of the appeal in December 2004, to the date of the withdrawal, offering explanations for some of the delays which had occurred in complying with the directions made, during the case.
36. The delays in complying with the directions in July and August 2005, were explained to be because their solicitor had suffered a bereavement and had not been available for about three weeks because he was on compassionate leave. He was also alleged to have suffered severe ill health as a result of a heart condition, with the result that the Applicants' conference with Counsel was twice postponed, the first time because the solicitor wasn't available and the second because Counsel had not received the relevant papers. There appeared to have been little work done in pursuing the appeal over the summer, with an assistant solicitor, Mr Khan, dealing with the file in Mr Sutton's absence.
37. At the delayed conference with Counsel on the 12th September, the Applicants' were told that he had not had an opportunity to read the witness statements, and it was not until the further meeting on the 5^th October 2006 that the Applicants' were told that unless they were able to produce information to counter the contents of some of the Respondent's witness statements, then the insurers were likely to withdraw their financial backing for the appeal. Both Mr and Mrs Bannister were adamant that the legal advice they had been given was changed at the conference on the 5^th October – with Counsel indicating for the first time that unless they could produce information to counter the contents of the witness statements, he could not advise that the appeal should proceed. They confirmed that they did not receive any written advice from Counsel or the solicitor to confirm what they had been told at the conference. Ms Lucas did confirm however that she received an approach from Rowe Cohen about a possible withdrawal on the afternoon of the 5^th October 2005.
38. At the hearing of the application for costs, Mr Bannister submitted that up to the 5^th October, the insurance company had been in contact with him directly, because they were not being kept informed of progress by the solicitor.
39. In a letter dated the 7^th October 2005, addressed to Bevan Brittan, Mr Stuart Sutton confirmed that the appeals were being withdrawn and went on to explain that although a bundle of documents had been received dated the 8^th September 2005, they did not receive the substantive bundle with the witness statements marked until the 30^th September 2005. The letter also confirmed that the statements had not been read until the weekend of the 1^st and 2^nd of October and had not been disclosed to Counsel until the 3^rd October. Counsel had started reading the papers on the 4^th and 5^th October. The matter of withdrawal had not been discussed until the conference of the 5^th October.
40. Following the advice on the 5^th October, Mr and Mrs Bannister had funded a final conference with their legal team on the 7^th October to try and persuade Mr Hirst of Counsel to change his view of the case. They believed up to that point that they would be able to ensure the backing of the insurer and would be in a position to start the appeal hearing on the 10^th October. Mr Bannister was insistent at the hearing that they did not indicate their agreement to withdraw to the solicitor until the afternoon of the 7^th October 2005.
41. Mr and Mrs Bannister were adamant that they had only received four files of documents in the case and no witness statements. At the hearing, Ms Lucas of Bevan Brittan confirmed that the first lot of documents sent to the Applicants would have been in four files, with the witness statements bundled together separately. During a break in the hearing, she checked the documents brought to the hearing by Mr and Mrs Bannister and confirmed that the documents did not include the bundle of witness statements.
42. At the hearing, Ms Lucas also confirmed that she had tried on numerous occasions in July and August to contact Mr Sutton of Rowe Cohen and had been unable elicit any response from him about the case. His assistant Mr Khan had told Ms Lucas in the course of a telephone conversation that he felt lost trying to deal with the case and was unable to do so in Mr Sutton's absence.
43. In her submissions, Ms Lucas referred to the Tribunal cases of Gibson and Woodbine Villa (Shahid Akhter and Tanveer Salam) v NCSC [2002] 116NC . She acknowledged, in the light of the decision in Gibson, that the burden of proof in an application for costs would be on the party making the application and that the test is a high one.
44. She referred to the Woodbine Villas case in relation to the definition of "reasonable". In that case, the Tribunal concluded that "Costs are more likely to be made where a party has acted unreasonably in conducting the proceedings. Persistent failures to comply with the directions given by the President or nominated chairman and in particular, failures to comply with "unless orders" made pursuant to Regulation 10 of the 2002 Regulations are likely to result in findings of unreasonable conduct." She identified the Applicants' failures to comply with the deadlines imposed in the directions as "persistent failures" which should be construed as unreasonable conduct.
45. Ms Lucas also submitted that the Applicants' could not rely on the conduct of their legal representatives as an excuse for the delays in the conduct of the case, referring to paragraph 46 of the Gibson decision where it is stated: "The Applicants provided no authority for the proposition that a party can avoid a cost order in this or indeed any jurisdiction by simply saying it was "not my fault it was my representative". It is true that in other jurisdictions powers exist to make "wasted costs orders" but that does not apply here. In our view it cannot be correct that a receiving party is left with no effective remedy where there has been unreasonable conduct to the proceedings by a party's representative."
46. In response to the directions given by His Honour Judge Pearl on the 24^th January 2006, Mr Bannister arranged for a valuation of the properties in their possession and requested a redemption statement from the Bank of Scotland in relation to the mortgage account. The Tribunal received copies of the valuations undertaken of Numbers 1 and 3 Silverlands Avenue, but Mr Bannister submitted that the surveyors had been unable to identify even a guide price for the Home because it is currently empty and an indication has been given by the CSCI that the building will now be classed as a "new build" and will have to comply with the Regulations as if it had been recently completed. He submitted that the structure of the building was such that it could not be modified so as to comply with the new requirements and that it was too big, with 24 bedrooms, to be priced as a private residence. No 3 is currently empty and in the process of being renovated.
47. Mrs Bannister explained to the Tribunal at the hearing that an overdraft facility had been agreed with the bank since the closure of the Home and debts incurred in paying the current outgoings on the property. A new loan for the whole of the current liability was being negotiated with Barclays and the current mortgage is in the region of £140 000. The Applicants did not produce any documentary evidence of the secured loan, claiming that the details of the remortgage had not yet been finalised.
48. Ms Lucas submitted that on the basis of the information presented to the Tribunal by the Applicants, their assets were currently valued at about £400 000 and their debts at £253 687 leaving a significant balance with which to pay any costs order made against them.

Tribunal's conclusions with reasons.

49. We considered the application for costs in the context of Regulation 24.
50. Our first consideration was whether the Applicants had been unreasonable in the bringing or conduct of the appeal.
51. In this case, there were no findings of fact made on the evidence because the appeals were withdrawn on the last working day prior to the hearing. It is also relevant that the costs application was made in respect of costs incurred after the 26^th August 2005, when it was submitted that a reasonable applicant would have considered the evidence and withdrawn his appeal. It is not, therefore, an issue for the Tribunal whether or not the Applicants were unreasonable in bringing the appeal, only in its conduct and for a specific period from the 26^th August 2005 to the 7^th October 2005.
52. In our view, the question of whether the Applicants conduct was reasonable must be a decision made individually in each case, considered on the facts and decided on the circumstances pertaining to that case.
53. We considered the allegation that the Applicants had been responsible for delays which added to the workload of the Respondent and incurred additional costs. We looked at the chronological basis for this allegation: there had been directions in January 2005, an agreed extension in March/April to the timetable, a delay of 6 days in filing Mrs Bannister's Notice of Appeal after the directions of the 7^th June 2005 and the difficulties which ensued in July and August.
54. We did not consider that any of the delays up to the end of June were such as to create any significant additional work for the Respondents and because each delay was anticipated and approaches made to agree revised dates, we do not consider that it is appropriate to label these as "persistent delays". Furthermore, it seems that the Respondents accept this logic, since their application does not include the period when the alleged delays occurred. The Respondent did not adopt the Notice of Proposal in respect of the non-urgent appeal until May, consequently it is difficult to understand why they would have been affected by the delays cited.
55. Only once, in the second week of September was a request for an "unless order" made by the Respondent, and in the event, the order wasn't made because the direction was complied with prior to its being made. We do not accept therefore that the conduct of the appeal up to the end of June could be described as "unreasonable".
56. From the end of June to the beginning of September, there were other issues relevant to the consideration of whether the conduct of the case was reasonable. It is clear that there was a lack of communication between the Applicants' solicitor and his clients, and Ms Lucas confirmed that the Respondent's solicitors also encountered difficulties in communicating with the conducting solicitor. Mr Bannister was able to explain some of the delay, describing a sudden bereavement and ill health as reasons for the representative's failure to comply with the deadlines imposed in the directions. We had nothing in writing from the solicitor to explain the circumstances and it may be that he has a different perspective. However, we consider that the explanations put forward by Mr Bannister are sufficiently strong to offer a reasonable explanation for the delay and to distinguish this case from one where the Applicant may be simply seeking to hide behind their representative's conduct of the case, when an application for a costs order is made. Personal difficulties can arise and we have decided that the response to such unexpected circumstances, whilst not ideal, cannot be construed in this case as unreasonable.
57. In another jurisdiction, we might be considering a wasted costs order, but this is not within the jurisdiction of this Tribunal. If Mr and Mrs Bannister's evidence about the circumstances is correct, then their legal representatives may have failed them in the preparation and presentation of the case but there are other avenues open to them to pursue in that situation. We did not have the benefit of any written advices from the solicitor or the barrister as to the merits of the appeal and cannot therefore comment on the advice given to Mr and Mrs Bannister. Where an applicant has instructed a team of professional legal representatives to present the appeal on their behalf, then it is our view that they are entitled to rely on the advice given to them in the conduct of the appeal, where the advice appears reasonable to the lay person.
58. From the information provided by the Applicants, it appears that it was the intention of the legal advisers to pursue the appeal, and that there was no indication at the conference on the 12^th September 2005 that there could be a problem in retaining the insurers' financial backing. We have accepted Mr and Mrs Bannisters' evidence that the first they knew about a potential problem with the insurers was at the conference on the 5^th October 2005.
59. Their version of events is corroborated by the letter from Rowe Cohen to Bevan Brittan dated the 7^th October 2005. The first conference with Counsel on the basis of the finalised bundle was on the 5^th October, and it was then that Counsel expressed to Mr and Mrs Bannister that he had shortened the odds on their successfully pursuing the appeal. In view of the fact that Mr and Mrs Bannister relied on the advice of their legal team, we have concluded that it was not unreasonable for the timing of their withdrawal of the appeals to occur on the final working day prior to the commencement of the hearing.
60. Because we have reached the conclusion that the conduct of the Applicants was not unreasonable, the application for a costs order in this case fails. We do not therefore need to consider the other limbs imposed by Regulation 24.

Order:

Application for costs dismissed.

This was the unanimous decision of the Tribunal

Meleri Tudur, Chairman

Marilyn Adolphe

Susan Last

Dated the 26^th February 2006.