England and Wales High Court (Senior Courts Costs Office) Decisions

IN THE HIGH COURT OF JUSTICE
SENIOR COURTS COSTS OFFICE

		Clifford's Inn, Fetter Lane London, EC4A 1DQ
		23rd November 2010

Master Haworth, Costs Judge:

BACKGROUND

1. This is an appeal against a decision of Costs Officer Emery in a detailed assessment carried out on 5 November 2009 to allow Counsel's fees of £150.00 for attending an infant approval hearing in this matter on 19 November 2008 before District Judge Millard at the Ilford County Court. The appeal raises a point of law concerning the recoverability of Counsel's fees generally for attending infant approval hearings. The appeal is brought pursuant to CPR47 20(1). The powers of the Court on appeal are set out in CPR rule 47.23.

"On an appeal from an authorised Court officer, the Court will:

(a) rehear the proceeding which gave rise to the decision appealed against, and

(b) make any order and give any directions as it considers appropriate."

2. This is another case involving the predictable cost regime in Part 45 II CPR. The dispute between the parties is limited to whether or not Counsel's fees for attending the Claimant's infant approval hearing could be recovered between the parties under the provisions of CPR Part 45 Section II which provides a scheme of fixed recoverable costs. At the detailed assessment, the Respondent (Claimant) submitted that CPR Part 45 Section II did not apply to the Respondent's claim for costs, on the basis that the damages recovered were only £1,000. Her claim was therefore a small claim "to which Part 45 Section II did not apply". The argument was accepted by the Costs Officer.

THE ISSUES

i) Is Part 45 Section II CPR engaged and therefore the predictable costs regime applies to the circumstances of this case.

ii) Once that question is answered, the Court must then determine how the answer to the first question impacts upon the Claimant's claim for costs.

FACTS

3. On 18 November 2006 the Respondent (Claimant) then aged 5 was injured whilst travelling as a passenger in a vehicle which came into collision with another vehicle. The Respondent, through her litigation friend, instructed a solicitor to pursue a claim for damages on the Respondent's behalf. On 31 July 2007, Dr Sajive Bansal examined the Respondent and prepared a medical report setting out details of her injuries. The salient conclusions in his report are:

"The client continued to suffer neck pain for two days before disappearing.

The client suffered a nose bleed straight after the accident. This settled after half an hour.

The client suffered some friction burns to her face. These healed after one week.

The client suffered irritation in both eyes. This settled completely after two days.

Physiological symptoms: the client felt shocked and upset after the accident. This continued for one day. The client denied insomnia.

The client suffered some anxiety as a passenger. This continued for two weeks.

The client continues to remain pain-free.

Summary, conclusion and prognosis: The client sustained whiplash injury following impact. The client was pain free after two days."

4. On 22 August 2007, solicitors acting on behalf of the Respondent sent a copy of the report of Dr Bansal to the Appellants insurers. On 15 September 2007, they wrote offering, subject to liability, £1,000 for the Respondent's general damages. In reply the Respondent's solicitors wrote stating that they were taking their client's instructions. They went on to say:

"Please note that should our client wish to accept this offer, then we believe that this case will settle within the Predictive Costs regime. We would therefore expect payment of damages and costs within the reasonable period of 14 days of acceptance. Any dispute in relation to disbursements will be dealt with separately."

5. A chasing letter was sent on 19 November 2007. On 11 December 2007 the insurers wrote to the Respondents solicitors stating that they were unable to deal with the Respondent's claim on a without prejudice basis and they were instructing solicitors to deal with infant's approval proceedings on their behalf. There the matter rested until the Respondent's solicitors served a Section 151 Road Traffic Act Notice on the insurers of 30 April 2008, which prompted a response from the Appellants insurers on 23 May 2008 in the following terms:

"We trust the offer of £1,000 in respect of general damages may be agreed, subject to acceptance at the Infant Court Approval hearing."

6. Part 8 proceedings seeking approval of agreed damages were commenced in the Ilford County Court on 3 October 2008, and the Order approving the settlement by District Judge Millard is dated 19 November 2008. On 3 November 2008, the Respondent submitted a Schedule of Costs to the Appellant calculated in accordance with the provisions of Part 45 Section II CPR. The Respondent's claim for solicitors' profit costs was compromised, the only issue remaining between the parties being Counsel's fees for attendance at the Infant Settlement Approval hearing.
7. On 26 March 2009, the Respondent served Notice of Commencement of assessment of a bill of costs in the sum of £307.35. The only items within the bill of costs were Counsel's fees for attendance at Court on 29 November 2008 of £150 plus VAT, together with the costs of assessment. Points of dispute were served on 8 April 2009, with replies served on 27 April 2009. The matter came before Costs Officer Emery on 5 November 2009 when Counsel's fee for attendance on 19 November 2008, together with the costs of assessment were allowed.

THE LAW

8. Part 21 CPR provides that settlement on behalf of child must be approved by the court.

"21.10(1) Where a claim is made

(a) by or on behalf of a child or protected party; or

(b) against a child or protected party

no settlement, compromise or payment (including any voluntary interim payment) and no acceptance of money paid into court should be valid so far as it relates to the claim by, on behalf of or against a child or protected party without the approval of the court.

(2) …………

(3) In proceedings to which Section II of Part 45 applies the court will not make an order for detailed assessment of the costs payable to the child or protected party but will assess the costs in the manner set out in that section."

9. : Part 45 Section II CPR refers to fixed recoverable costs in road traffic accidents. The scope and interpretation of the predictive costs regime are set out in Rule 45.7 in the following way:

"45.7(1) This section sets out the costs which are to be allowed in –

(a) costs only proceedings under the procedure set out in Rule 44.12A; or

(b) proceedings for approval of a settlement or compromise under Rule 21.10(2) in cases to which this section applies.

(2) This section applies where –

(a) the dispute arises from a road traffic accident;

(b) the agreed damages include damages in respect of personal injury, damage to property or both;

(c) the total value of the agreed damages does not exceed £10,000; and

(d) if the claim had been issued for the amount of the agreed damages the small claims track would not have been the normal track for that claim."

10. Rule 45.9 fixes the amount of recoverable costs, and Rule 45.10 deals with disbursements in the following:

"45.1(10) The court

(a) may allow a claim for a disbursement of a type mentioned in paragraph 2; but

(b) must not allow a claim for any other type of disbursement.

(2) The disbursements referred to in paragraph (1) are:

(a) the cost of obtaining:

(i) medical records;

(ii) a medical report;

(iii) a police report;

(iv) an engineers report; or

(v) a search of the records of the driver vehicle licensing authority;

(b) the amount …

(c) where they are necessarily incurred by reason of one or more of the claimants being a child or protected party as defined in Part 21:

(i) fees payable for instructing counsel; or

(ii) court fees payable on an application to the court."

11. As this matter was commenced by virtue of the Part 8 procedure, Rule 8.9 CPR modifies the general rules in the following way:

"8.9 Where the Part 8 procedure is followed:

(a) …

(b) …

(c) the claim shall be treated as allocated to the multi track and therefore Part 26 does not apply."

12. The relevant provisions of Part 26 are:

"26.6(1) The small claims track is the normal track:

(a) any claim for personal injuries where

(i) the value of the claim is not more than £5,000; and

(ii) the value of any claim for damages for personal injuries is not more than £1,000.

(2) For the purposes of paragraph (1) "damages for personal injuries" means damages claimed as compensation for pain, suffering and loss of amenity and does not include any other damages which are claimed.

(3) Subject to paragraph (1) the small claims track is the normal track for any claim which has a value of not more than £5,000.

General rule of allocation

26.7(1) In considering whether to allocate a claim to the normal track for that claim under rule 26.6, the court will have regard to the matters mentioned in rule 26.8(1).

Matters relevant to allocation to a track

27.8(1) When deciding the track for a claim, the matters to which the court shall have regard include:

(a) the financial value, if any, of the claim;

(b) the nature of the remedy sought;

(c) the likely complexity of the facts, law or evidence;

(d) the number of parties or likely parties;

(e) the value of any counterclaim or other Part 20 claim and the complexity of any matters relating to it;

(f) the amount of oral evidence which may be required;

(g) the importance of the claim to persons who are not parties to the proceedings;

(h) the views expressed by the parties; and

(i) the circumstances of the parties."

APPELLANT'S SUBMISSIONS

13. The Appellant submitted that Part 45 Section II CPR applied to the Respondent's claim for costs, and as a consequence the predictable costs regime was engaged. Mr Baird argued that Part 45 II CPR applied to the Appellant's claim for costs as a matter of contract. On receipt of the medical evidence, the Appellant's insurers made an offer to the Respondent to settle damages in the sum of £1,000 on 15 September 2007. At that point the offer was made without prejudice to liability on the basis that liability had not then been apportioned between the drivers involved. In their reply on 25 September 2007, the Respondent's solicitors wrote:

"Please note that should our client wish to accept this offer, then we believe that this case will settle within the predicted costs regime."

14. The correspondence referred to in paragraphs four and five ensued, culminating in a letter from the Appellant's insurers to the Respondent's solicitors on 23 May 2008 which stated, amongst other things:

"We trust that the offer of £1,000 in respect of general damages may be agreed, subject to acceptance at the Infant Court Approval hearing."

15. Accordingly, Mr Baird submitted that in their letter of 23 May 2008, the Appellant insurers accepted the terms introduced by the Respondent in her letter of 25 September 2007, namely that Part 45 Section II CPR should apply in respect of costs, and thus there was a binding agreement between the parties.
16. Mr Baird's second line of argument was that the conduct of the Respondent gave rise to an estoppel which now prevents her from arguing that Part 45 II CPR should not apply. In her letter of 25 September 2007, the Respondent indicated that a settlement in the sum of £1,000 would give rise to an entitlement cost under Part 45 Section II. Furthermore, on 3 November 2008, the Respondent's solicitors submitted a schedule of their costs calculated in accordance with the provisions of Part 45 Section II CPR. Additionally, the Appellant's objection to the Respondent's costs, both in correspondence and in points of dispute, was predicated upon the application of Part 45 Section II CPR. The Respondent's Reply did not indicate the basis of their case was that Part 45 II CPR did not apply. In support of the estoppel point, Mr Baird submitted that the majority of the Respondent's costs, save for Counsel's fee, were compromised on the basis that Part 45 Section II CPR applied. The correspondence and conduct of the Respondent represents that Part 45 Section II CPR would apply to the Respondent's claim for costs. Based upon that representation, the Appellant agreed to settle the Respondent's claim for damages, agree the majority of the Respondent's costs and pursued the outstanding cost issue to a detailed assessment hearing on that basis. Mr Baird argued that the Appellant had materially altered its position as a consequence of the representations made by the Respondent and it is now unconscionable for the Respondent to resile from those representations. He argued that once the Respondent has agreed part of her costs in accordance with one cost regime (ie Part 45 II CPR), she cannot then chose to apply a different cost regime to the remainder of her costs to achieve a more favourable result.
17. The third line of argument deployed by the Respondent was that the Costs Officer had accepted that Part 45 Section II CPR did not apply because the Respondent's claim was a small claim within the meaning of CPR rule 26.6. The Appellant relied on CPR 45.7(II) (d) which provides that Part 45 Section II CPR only applied in circumstances if "a claim had been issued for the amount of the agreed damages, the small claims track would not have been at the normal track for that claim". Mr Baird argued that the value of the claim is not the only factor which the Court considered when allocating a claim. Rule 26.8 CPR provides nine relevant factors of which the financial value is only one. He argued that another factor which the Court would take into account when allocating this case was "the nature of the remedy sought and the circumstances of the parties". He argued that the small claims track is not the normal track for a claim valued at £1,000 where the Claimant is a child and, as a consequence of that, approval of the Court is recquired. Accordingly, it was submitted that this is not a claim which fell outside Part 45 Section II CPR.
18. In relation to how this argument impacts on the Respondent's claim for costs, were I to find that Part 45 Section II CPR did apply it was submitted that although Rule 45.9 CPR fixes the recoverable amount for solicitors profit costs, it does not similarly fix the level of disbursements. Both the issue of whether to allow a claim for disbursement and the amount of any disbursement allowed, are in the discretion of the Court pursuant to the Rule 45.10 CPR. Rule 45.10 (2)(c) provides that the Court may allow them where they are "necessarily incurred" by reason of one or more of the Claimants being a child or protected party is defined in Part 21". Should the costs of attendance at the Infant Approval Settlement be subsumed in the fixed profit costs of the solicitor, or should they be recoverable as a disbursement in addition. The Appellant's case was that Counsel's fees were "not necessarily incurred on the facts of the case, and should not be allowed in addition to the fixed profit cost". There was nothing out of the ordinary in relation to this settlement. The damages were modest and it was not necessary to incur the costs of Counsel in attending the hearing. Counsel's advocacy skills were not required at the hearing. The circumstances of the accident were straightforward. Liability was not an issue. The Claimant's injuries were not unusual. She had made a complete recovery. Like many Infant Settlement Approval cases, Mr Baird argued this was a straightforward case and the hearing could have been attended by the Claimant's solicitors or a legal clerk from his officer. Had that happened, no costs would be recoverable in addition to the fixed profit costs, under Rule 45.9 CPR.
19. Mr Baird submitted that the real reason for the instruction of Counsel in this case was a matter of geography. That was what was said by the Respondent in her replies to the points of dispute. The Respondent's solicitors are based in Merseyside. It was a simple matter of convenience to brief Counsel to attend at Ilford County Court for the approval hearing, rather than for the solicitor to take time away from the office.
20. In the alternative, were I to find that Part 45 Section II CPR did not apply by virtue of the fact that the small claims track was the appropriate track for this claim, Mr Baird submitted that it follows that the Respondent's costs should be assessed in accordance with the provisions on Rule 27.14 CPR, which governs costs on the small claims track. As that rule makes no provision for Counsel's fees, they cannot be recovered as between the parties.
21. Mr Baird submitted that at the earlier detailed assessment before Costs Officer Emery, the Respondent had submitted that Rule 8.9(c) CPR applied, which provides that claims issued under the Part 8 procedure are treated as allocated to the multi-track and as such that the small claims costs provisions did not apply. Mr Baird contended that that analysis was flawed in that Rule 8.9(c) is no more than a procedural nicety to disapply Part 26 CPR (the procedure for allocating claims). Rule 8.9(c) falls short of actually allocating the claim to the multi-track, and accordingly the claim remains unallocated. In the absence of allocation to the small claims track, it does not preclude an assessment of costs in accordance with the provisions applicable for that track, and in this regard the Appellant relied on the judgment of H H J Stewart QC in Keklik –v- Coles and Master Rogers in Aurangzeb –v- Walker, together with the Court of Appeal decision in O'Beirne –v- Hudson. In the circumstances it was not reasonable for the Respondent to recover anything other than small claims cost.

THE RESPONDENTS SUBMISSIONS

22. Mr McNair submitted that Part 45 Section II CPR did not apply to this case. The Respondent had settled her claim for personal injuries in the sum of £1,000. As the value was not more than £1,000, the application of Rule 26.6 CPR meant that the small claims track was the normal track for this claim. The predictable cost regime therefore did not apply. Rule 45.7 was included purely to fix the limits of the predictable cost regime. In particular, sub paragraph (d) was there purely to fix the limit of costs by reference to the small claims track limit. It set the lower limit by reference to the value of the claim. It was a rule not of general discretion, allowing the Court to consider whether it would have allocated to any particular track, but purely to fix the limits or scope of the fixed recoverable cost regime. Any other interpretation of the rule would open up parties to argue about allocation of a particular case pursuant to the factors contained in Rule 26.8 at CPR. It was argued that the words "normal track" are a term of art. For those reasons, it was submitted that Rule 45.7 and in turn Part 45 Section II CPR was not engaged in this case.
23. The Respondent submitted that as the claim had been brought under Part 8 CPR, the usual rules of allocation do not apply. Application of Rule 8.9(c) CPR meant that this claim should be treated as allocated to the multi track, and therefore Part 26 did not apply. As such costs were at large.
24. As far as the Appellant's arguments were concerned, Mr McNair addressed the points as follows:
25. Contract: It was submitted that the Claimant's letter of 25 September 2007 was not an offer. The words "please note that should our client wish to accept this offer then we believe that this case will settle within the predictive cost regime" was no more than a statement of belief, an opening shot in the negotiations as to costs. Although the Respondent's solicitor wrote of his belief that the predictive cost regime applied, the plain fact of the matter was that this belief was wrong in law.
26. Even if the letter of 25 September amounted to an offer, it would only have been open for acceptance for a reasonable time. The Appellant claims to have accepted the offer on 23 May 2008, some eight months after the purported offer was made. Any offer made in September 2007 would have lapsed by that date. Even if the Appellants letter of 23 May 2008 was acceptance of an offer to deal with costs under predictive costs regime, that letter made no reference to costs or any purported offer by the Respondent. It merely reaffirmed the Appellant's earlier offer in respect of general damages. It was submitted that there was no contract between the parties to the effect that they would apply the predictive cost regime. To do so would be to contract out of the Civil Procedure Rules. Based on the submissions of the Respondent, although the rules disapply the predictive costs regime, the Appellant says the parties have nevertheless agreed it should apply. The fact that the parties agreed other aspects of the costs claim, namely solicitor's profit costs, on figures derived from the predictive regime, was not relevant to the matter.

Estoppel

27. Mr McNair submitted that the Appellant's argument, raising an estoppel, was flawed. He argued that the representation contained in the letter of the 25^th September 2007 letter was a representation of law, in that the Appellant's solicitor expressed his belief that costs would fall under the predictive costs regime. In the light of the judgment of Scott LJ in Territorial and Auxiliary Forces Association of the County of London v Nicholls [1949] 1 KB 35, a representation of law cannot found an estoppel. In any event there was no detrimental reliance upon the representation, which was only a "belief" at best.

Part 45 Section 2 CPR

28. The difficulty with the submissions of the Appellant, were that on the one hand it was conceded the small claims track was not the normal track for a £1,000 claim by a child on the basis that approval of the court was required and other factors in Rule 26.8 CPR. On the other hand, when considering the consequences were I to find that Part 45 Section II of CPR applied, the Appellant had argued that, applying Coles v Keklik, the claim should have been issued for £1,000 and allocated to the small claims track. It was submitted on behalf of the Respondent that the "normal track" for the claim is a term of art within CPR defined at rule 26.6 CPR. The "normal track" for a personal injury claim is the small claims track if the value is not above £1,000. The court has discretion to allocate the claim to a different track, but this has no bearing on the application of the predictive costs regime, which applies only in respect of the "normal track".
29. The correct test to apply was whether the costs of attendance were reasonably incurred and reasonable in amount pursuant to Rule 44.4 CPR. The Respondent required the approval hearing in order to settle her claim. It could not be disposed of otherwise. Mr McNair relied on the findings of HHJ Oliver-Jones QC in Dockerill v Tullett a decision in the Birmingham Count Court, which coupled with the concessions made by the Appellant at paragraph 22 to 24 of his skeleton argument meant that this was not a case which justified the court in exercising its discretion to award only small claims costs, and thus disallow counsel's fee for attending the infant approval hearing.

Discussion and Conclusion

30. The first matter that I have to decide is whether Part 45 Section II CPR is engaged, and applies to the Respondent's claim for costs. The three limbs of the Appellant's submissions in this regard are that Part 45 Section II applies either as a matter of contract, by reason of an estoppel or because the Claimant's claim does not come within the small claims track exclusion to that part. Dealing with each issue in turn.

The Contract Point

31. The Appellant relies on the correspondence between the parties and a schedule of costs to found a claim in contract. In particular reliance is placed upon the Appellant Solicitor's letter of 25 September 2007, wherein it was stated:

"Please note that should our client wish to accept this offer then we believe that this case will settle within the predictive costs regime."

32. There then followed a prolonged period of inactivity, punctuated only by a chasing letter from the Appellant Solicitors on 19 November, and a letter from the Appellant's insurers on 11 December concerning issues of liability. It was only when a Section 151/152 Road Traffic Act notice was served by the Respondents Solicitors on 30 April 2008 that a response was elicited from the Appellant insurers in the following terms:

"We trust that the offer of £1,000 in respect of general damages may be agreed subject to acceptance at the infant court approval hearing."

33. Part 8 proceedings were subsequently commenced, and the court's approval was obtained in a sum of £1,000 on 19 November 2008. The Appellant also relies on a schedule of costs served by the Respondent's Solicitors on 3 November 2008, based on the costs calculated in accordance with Part 45 Section II of CPR. The Respondents solicitors profit costs were agreed on that basis, including disbursements, save for counsel's fees which were the subject of this dispute between the parties.
34. In relation to the contract point, I prefer the submissions of the Respondent to those of the Appellant. In my judgment there was no contract between the parties. There was no intention to be bound by the words "we believe" in the letter of 25 September 2007. I do not accept that the letter from the Appellant's insurers of 23 May 2008 amounted to an acceptance of the terms introduced by the Claimant Solicitors in her letter of 25 September 2007, namely that Part 45 Section 2 CPR should apply in respect of these costs. Even if the letter of 25 September 2007 were to constitute an offer, that offer lapsed after a reasonable time and in this case some eight months elapsed before the alleged acceptance. In my judgment, even if the letter of 25 September 2007 constituted an offer, namely an intention to be bound on certain terms, that offer would have lapsed. The words contained in the letter of 25 September 2007 were merely a statement of belief, an opening shot in the negotiations as to costs.
35. If I am wrong in this regard, in my judgment the Appellants insurer's letter of 23 May 2008 was by no means an acceptance of an offer to deal with the costs of the claim in accordance with the predictable costs regime. The letter made no reference to costs, or any purported offer by the Respondent it merely re-affirmed the Appellant's earlier offer in respect of general damages. The fact that the parties may have agreed other aspects of the costs claim, namely the Solicitors profit costs by reference to the figures and sums referred to in Part 45 Section II CPR, is not relevant in my view to the issue as to whether a contract existed between the parties.

Estoppel

36. The Appellant argued that the conduct of the Respondent gave rise to an estoppel which prevents her from arguing that Part 45 Section 2 CPR should not apply. The letter of 25 September 2007 refers to an entitlement to costs pursuant to Part 45 Section 2 CPR, and the Schedule of Costs submitted on 3 November 2008 is calculated in accordance with those provisions. Furthermore, the Appellant's objections to the Respondent's costs in correspondence, and formal Points of Dispute in the assessment brought before Costs Officer Emery, were predicated on the basis that Part 45 Section 2 CPR applied. In other words the Respondent has represented to the Appellant that Part 45 Section 2 of CPR would apply to her costs. In reliance upon that representation the Appellant agreed to settle the Respondent's claim for damages, and has agreed all but Counsel's fees on that basis. It was put to me that once the Respondent had agreed part of her costs according to one costs regime, she could not then choose to apply a different regime to the remainder of her costs to achieve a more favourable result. It would be unconscionable for the Respondent to resile from the representations she made in correspondence and in earlier negotiations to settle these costs. The Respondent referred me to the judgment of Scott LJ in Territorial & Auxiliary Forces Association of the County of London v Nicholls [1949] 1 KB 35:

"A further ground on which in our view the appeal of the plea of estoppel must fail is that the statements in the rent book if amounting to a representation at all constitute a representation of law and not of fact. The view advanced on behalf of the defendant Nicholls was that the statements represented the premises which were the subject of his tenancy were within the Rent Restriction Acts: in other words that they were controlled premises. That is not a representation of fact it is a statement of the result obtained by applying the provisions of the Act to the circumstances of the particular case. It is no easy matter sometimes, as the many decided cases on the subject show, to say whether premises are or are not within the Acts, and a statement to the one effect or the other cannot, in our judgment, be fairly regarded other than as a representation of law."

37. That approach was approved in the Privy Council case of Kai Nam v Ma Kam Chan [1956] AC 358, where Lord Cohen said:

"It is sufficient to observe that if the documents relied on can be regarded as containing representations, such representations are representations of law not of fact and cannot find an estoppel."

38. In this case I have concluded that it is not necessary to go so far as to determine whether the matters raised by the Appellant were either a representation of fact or a representation of law. It seems to me the matter ends one stage before that in considering whether what was said by the Respondent Solicitors was a representation at all. They refer in the letter of 25 September 2007 to a "belief". To my mind that is not a representation at all. Even if it were, I find that it is a representation of law and not a representation of fact. In any event in my judgment there has been no detrimental reliance upon the belief by the Respondents Solicitors. The fact that the Respondents solicitors have negotiated the majority of their costs by reference to the figures referred to in Part 45 Section 2 CPR, in the mistaken belief that it applied, does not in my mind make the matter unconscionable, or create any detrimental reliance in relation to the Appellant's position. In that regard, therefore, I prefer the submissions of the Respondent, and conclude that there was no estoppel.

Small Claims Track

39. It was argued by the Appellant that Part 45 Section 2 was engaged because the Respondent's claim did not come within the small claims track exclusion contained within Rule 45.7(2) (d) The Appellant then sought to change his position were I to find that Part 45 Section II CPR did not apply, and whether in those circumstances it was reasonable for counsel to be instructed to attend the infant settlement hearing. It was said by the Appellant that this matter would not have been allocated to the small claims track if issued because the damages were on the cusp on the small claims limit, namely £1,000, and secondly the fact that there was always going to be the need in this case for an infant settlement approval which would be a factor that the court would consider when allocating to track pursuant to Rule 26.8 CPR. Other pertinent features in Rule 26.8 applied to this case, and not just its financial value, for example the nature of the remedies sought, and the circumstances of the parties.
40. I prefer the submissions of the Respondent. In my judgment Rule 45.7(2) (d) is there purely to fix the limit of costs in respect of which the predictable costs scheme applies. It sets out the lower limits of the scheme by reference to the value of the claim. It is not a rule of general discretion for the court to consider for example whether it would have allocated a case to any particular track. The reference in the rule to "the normal track" is a term of art. Furthermore, these proceedings were issued by way of a Part 8 claim dated 3 October 2008. Applying Rule 8.9(c), Part 8 claims are treated as allocated to the multi track, and therefore the provisions of Part 26 do not apply. In other words costs are at large, and at the discretion of the court. For all those reasons I find that Part 45 Section 2 is not engaged in the circumstances of this case.

The Consequences of Part 45 Section 2 Not Applying

41. What then is the position regarding the costs in dispute in the light of my finding that Part 45 Section 2 CPR does not apply? I reject the submission of the Appellant at paragraph 66 of his skeleton argument that CPR Rule 8.9(c) falls short of actually allocating the claim to the multi track, and accordingly the claim is unallocated. I find that on any reading of Rule 8.9(c) that where the Part 8 procedure is followed, as it is in this case, the claim is treated as allocated to the multi track, and as a consequence costs fall to be assessed in accordance with the ordinary provisions of Rule 44.4.

"44.4(1) Where the court is to assess the amounts of costs (whether by a summary or detailed assessment) it will assess those costs –

(a) on the standard basis; or

(b) on the indemnity basis

but the court will not in either case allow costs which have been unreasonably incurred or are unreasonable in amount.

(2) Where the amount of costs is to be assessed on the standard basis the court will –

(a) only allow costs which are proportionate to the matters in issue; and

(b) resolve any doubt which it may have as to whether costs were reasonably incurred or reasonable and proportionate in amount in favour of the paying party."

42. In this case costs are to be assessed on the standard basis, and accordingly I must take into account the factors in Rule 44.5 CPR in assessing the reasonableness of incurring the costs in this case.
43. Taking into account the value of the costs in dispute and applying the global approach referred to by Lord Woolf CJ in Lownds v Home Office [2002] 1 WLR 2450 the costs in this case were not disproportionate. Accordingly I need not trouble myself with the test of necessity and must only consider what costs were reasonably incurred or reasonable in amount.
44. The Appellant referred me to a number of first instance cases to support his submission that counsel's fees should be disallowed in this case. The cases he referred me to were Woodruffe v Deeks, a decision of District Judge Farquhar in the Peterborough County Court on 10 November 2008. The case of Sherred v Carpenter by His Honour Judge O'Malley in the Taunton County Court on 5 March 2009, on appeal from District Judge Dowl. The decision of His Honour Judge Inglis in the case of Singh v Adams proceeding in the Nottingham County Court, on appeal from Deputy District Judge Cooper in March 2009. His Honour Judge Richardson in the case of Drury v Millard proceeding in the Bromley County Court on 6 October 2009, and finally the case of Miles v London Road Veterinary Clinic, a decision of District Judge Sparrow in the Norwich County Court on 5 December 2007. The cases all relate to whether it was reasonable for counsel to attend infant settlement hearings. However, in each of the cases it is clear that either the parties had agreed, or the Judge found that the predictive costs regime applied in the particular circumstances of each case. That being so, the provisions of Rule 45.10(2) (c) applied. To recover counsel's fees by way of a disbursement the costs under this rule must be "necessarily incurred" by reason of the claimant being a child or protected party. I distinguish all the cases referred to on the basis that I have found that the predictive costs regime does not apply in the particular circumstances of this case.
45. On the basis that I have found that the predictive costs regime does not apply in this case, the Appellant sought to argue the opposite of his earlier position. Had this case been issued as a disputed claim, it would have been allocated to the small claims track based on the medical evidence of Dr Bansal. In support of this submission the Appellant referred me to the decision of His Honour Judge Stewart QC in the case of Coles v Keklik in the Liverpool County Court on 30 June 2008. That was a case involving minor injuries to the claimant suffered in a road traffic accident which settled for £250. Approval of the settlement was not sought pursuant to Rule 21.10 CPR. The matter was resolved by way of "parental indemnity". In the course of his judgment His Honour Judge Stewart said this:

"22. Once it is seen, firstly that the child's lack of majority is properly remedied by having a responsible litigation friend and once the proper procedure is seen to be court approved with the safeguards therein contained, it seems to me to be wrong to say that there is any Article 6 factor which operates so as to give any child claimant costs which may be over and above the normal small claims track costs without there being any factors other than that the claimant is a child.

23. Similarly I do not accept the second point made by the District Judge: that it is in the public interest for children to have access to justice in a way that is more than illusory by way of their parents or a guardian. There is nothing to stop a child by its parent or guardian or litigation friend instructing a solicitor but especially with the protections that I have mentioned which are imposed by the rules, there is, it seems to me, no reason why it follows necessarily that the solicitor's costs shall be recoverable against the defendants."

46. The Court of Appeal in the case of O'Beirne v Hudson [2010] EWCA Civ 52 also gave guidance in relation to the test to be applied when considering orders for costs in relation to small claims. Giving the judgment of the court Lord Justice Waller said this:

"19. I have quoted the passage from Judge LJ's judgment in Voice and Script above. I accept that what was under consideration in that case was what order a trial Judge should make when making an order for costs. Thus in many cases the problem that occurred in this case will not arise because the trial Judge can actually make an order that costs be assessed on a small claims track basis. I also accept that as Judge Stewart noted, a Costs Judge has no power to alter the order for costs made by the a Judge, and thus make a direction from the outset where costs have been awarded on the standard basis that costs will be assessed on a small track basis. But what lay behind what Judge LJ said reflects what Lord Woolf was saying in Lownds and provided the Costs Judge does not purport to vary the original order or tie himself to assessing by reference to the small claims track it is quite legitimate to give effect as far as possible to the philosophy which lies behind the above statements. There is a real distinction between directing at the outset that nothing but small claims costs will be awarded and giving items on a bill very anxious scrutiny to see whether costs were necessarily or reasonably incurred, and thus whether it is reasonable for the paying party to pay more than would have been recoverable in a case that should have been allocated to the small claims track. Was it for example necessary to have had lawyers and is it reasonable for the paying party to have to pay for lawyers are questions that should arise where a claim should have been allocated to the small claims track."

47. The Appellant's argument was that the real reason for the instruction of counsel in this case was a matter of geography. The Respondent stated this in her replies to the Points of Dispute. The Respondent's solicitors are based in Merseyside. It was a matter of convenience to brief counsel to attend the court for the approval hearing, rather than for the solicitors to take time away from the office.
48. The Respondent relied on the judgment of His Honour Judge Oliver Jones QC in the case of Dockerill & Healy v Tullett in the Birmingham County Court on 15 September 2009. This was another case involving an infant settlement. The damages were agreed at £750. The Deputy District Judge at first instance concluded that the claimant was entitled to costs under Rule 45.7 CPR. On appeal the learned Judge found that as the matter was commenced under CPR Part 8, Rule 8.9(c) applied, and that the claim had been allocated to the multi track. In the course of his judgment the learned Judge said this:

"14. Those who were responsible for the drafting of the rules – and I include myself amongst them, although I have no memory of actually debating this particular point at the time the rule was considered by the Civil Procedure Rules Committee – must have had the provisions of CPR Part 8 in mind when determining that those cases that would normally have been commenced on the small claims track if they had not been settled should be excluded from the predictable costs or the fixed costs regime under CPR 42.2 because they could, had they wished to do so, have required that any such claim should be treated as having been allocated to the small claims track by amendment of CPR 21.10. That rule requires all approvals to be commenced by a Part 8 claim. There would have been nothing to have prevented the Rule Committee from saying that in cases that would normally have been commenced on the small claims track, that they should be treated for the purpose of approval of proceedings as having been allocated to the small claims track for costs purposes. They chose not to do so, and in my judgment they chose not to do so for a good reason.

15. A claim for damages for personal injuries of as little as £750 that is contested does not require approval because the Judge will determine what the damages are if they are in dispute and award costs on the small claims track regime as everyone will be aware, so to speak, in advance – both claimants and defendant's solicitors.

16. However, when it comes to the approval of a settlement of a child the court, through the rules, is in fact giving a good deal of responsibility to the solicitor who represents and advises a litigation friend and through the litigation friend, of course, the child. It is an important matter that solicitors should take that responsibility seriously and that the court should approve the steps they have taken. Amongst the steps that are required to be taken, except in the plainest case, is the obtaining of counsel's opinion on the merits of the proposed settlement. Often small cases are not "plain" and in a very small claim it would be an unwise solicitor who chose not to seek counsel's advice. Somebody has to pay for that responsibility and that advice. That would not be recoverable under the small claims track because the fixed costs allowed for the solicitors so called "profit costs" is only £70 and whilst the costs of medical reports may be recoverable counsel's fee for advice supporting the settlement would not be recoverable, nor would any time taken by the solicitor to accomplish the same end.

17. Therefore it seems to me that the correct approach is for costs to be assessed under and in accordance with CPR 44.5. All of the factors that the court must take into account in assessing the amount of costs for a multi track case are there set out and well known. It would be open to the defendant in such cases to argue that in reality small claims track case costs represent what is reasonable, but that would not be something that the District Judge would necessarily have to accept because the District Judge would be exercising a discretion as to what the costs should be. The usual arguments would be advanced by each side supported in the usual way by schedules. One would hope that in the majority of cases these matters would be dealt with summarily bearing in mind that the damages are so small and the costs of a detailed assessment in all but the most exceptional case be avoided."

49. The issue in this case it is not the costs of counsel preparing an opinion as to the merits of the proposed infant settlement, but in relation to the cost of an attendance at the infant approval hearing. The Appellant originally argued that on the facts of this case it would not have been allocated to the small claims track. He then sought to resile from that position were I to find, as I have, that the predictable costs regime did not apply, to my mind that is entirely unsatisfactory
50. His Honour Judge Stewart QC was not dealing, as is the case here, with an infant settlement approval. He was dealing with the issue of a "parental indemnity". I intend to adopt the test set out in O'Beirne at paragraph 19, and also the approach taken by His Honour Judge Oliver-Jones QC at paragraph 17 of his judgment. Looking at the factors set out in Rule 26.8(1) CPR, and in particular factors (a), (b), (i) this is not a case in my view that would have been allocated to the small claims track and therefore small claims track costs would not apply. Applying the factors set out in Rule 44.5 CPR the question I ask myself is whether, in all the circumstances, it was reasonable to send a representative to an infant approval hearing, and if so are the costs claimed, reasonable? In the light of the responsibility taken by the Respondent's Solicitor in advising the litigation friend to settle the claim in the sum offered, albeit for a small amount, I am satisfied that it was reasonable for a representative to attend the hearing in this case. Furthermore, using my experience, I am satisfied that the costs claimed by way of counsel's attendance at the hearing in the sum of £150 are reasonable and will be allowed.
51. Accordingly, the appeal is dismissed. So far as the costs of the appeal are concerned, the Appellant shall pay the Respondent's costs. In the absence of agreement between the parties, I propose to assess those costs summarily. The Respondent shall file and serve a statement of his costs within 14 days of the date of this judgment, and the Appellant shall file and serve any objections to those costs 14 days thereafter. Permission to apply as to the terms of this Order.