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Costs Bulletin for November 2016: Borchester, Mitchell and costs mediation

Borchester Crown Court

Whilst the nation held its breath (was Helen Titchener guilty of the attempted murder with a kitchen knife of her domineering husband, Rob, at Blossom Hill Cottage, Ambridge?), those with a costs bent continued to wonder at the generosity of the legal aid system in the Borchester Crown Court, which appeared to give Helen unlimited access to her barrister, Anna Tregorran, without the need for an instructing solicitor. The answer to question one: “did she do it?”, was given on 11 September 2016. She did not. As Judge Loomis explained to her: “Mrs Titchener, the jury have found you not guilty on both charges you faced. You may be discharged.” The answer to the second question “how are you paying for all this?” was not.

As downtrodden Helen left the dock without a stain upon her character, with rotten Rob being branded the cad and bounder that devotees of the Archers have long since known him to be, listeners were left to ponder: how was it that Helen came to be acquitted and who paid for her brief? As to the former, much was due to the redoubtable juror Jackie who insisted that the prosecution had failed to prove that Helen was not acting in self-defence. Accordingly, the charge of attempted murder was unproven, notwithstanding the attempts of Carl, the jury foreman, to find her guilty. So in the end, Dame Eileen Atkins, who played Jackie, prevailed over the entreaties of Nigel Havers, who played Carl. Justice was done and seen to be done.

Unfortunately for costs fruit cakes, the dunty-dunty – dunty-darr music commenced no sooner than the words “not guilty” and “you may be discharged” had been uttered. Not a word was mentioned about who was going to pay for the trial in the Borchester Crown Court which had gripped the nation for weeks. Those of a costs- type demeanour were curious. How was it that Helen could have a barrister on tap throughout the period of her custody in the Ambridge nick awaiting trial, without a solicitor to proof key witnesses such as Rob’s first wife Jess. In the event, it was the evidence of the “ex” who had turned the case in Helen’s favour by exposing what a rotter Rob had been during her own marriage. The key witness statement had been taken by learned counsel Anna without a solicitor in sight and who had then led Jess’s evidence in chief as she dished the dirt on her former husband. But how Anna was to be paid remained a mystery.

The absence of any solicitor raised eyebrows with the Law Society’s criminal law committee. Rodney Warren, its former chairman, told the press “it’s been very unfortunate that the storyline has been developed in such a bar-centric way”. Not so, said a partner at Kingsley Napley: “The barrister takes instructions from both their lay and professional client.” However, the existence or lack of a solicitor left the crucial question unanswered. How was Helen’s defence being funded in such a way that enabled Anna to travel the country proofing witnesses and visiting her client in the cells?

The answer to that conundrum was provided in part during an episode last week in which Helen’s father Tony revealed that Helen had received repayment of all her legal aid contributions. So it was the generosity of legal aid after all but that revelation merely thickened the plot. The Titchener family now comprises a stepson called Henry and a son (called Jack by one parent and Gideon by the other) and in the absence of any agreement, Judge Loomis was called upon to deal with contact in the family court. In a reasoned judgment, he decided that Rob should be permitted to see Gideon (or Jack) once a week for three hours in the Ambridge greasy-spoon on the High Street.

The costs? According to Tony the two hearings so far have cost £30,000, all charged up to credit cards and Ambridge Farm will need to be re-mortgaged to pay the fees. Cor! Good work if you can get it, and that may be the thin end of the wedge. Rascal Rob is applying to record his son and heir’s name formally as “Gideon” and there is to be another hearing in the Borchester family court to vary the access arrangements, now that he is working for local tycoon Justin Elliott. What will that cost? Another £30,000? And poor Tony just bought a new tractor. Mind you, those fees do sound a bit steep. Maybe the producers will get wise to s 70 of the Solicitors Act and advise Tony to apply for a detailed assessment.

Mitchell with another name

Just when you thought Mitchell had been consigned to the wastepaper bin following Denton and more recently McTear v Englehard [2016] 3 Costs LR 453, in which Vos LJ had some tasty words for Deputy Judge Spearman QC, who had refused relief from sanctions when evidence was served 50 minutes late, we now have Jamadar v Bradford Teaching Hospitals Foundation Trust [2016] 5 Costs LR 809. Now, it appears, you need a costs budget before the case has even been allocated to a track.

The facts

  • Clinical negligence claim with damages pleaded at £3 million.
  • Liability denied: the court gives notice in form N149C provisionally allocating the case to the multitrack.
  • Defence served. Form N149C revoked by court order: judgment entered on admissions: transfer to Bradford County Court.
  • Case management conference fixed by that court three months hence.
  • Defendant serves a costs budget and presses the clamant to do the same.
  • Claimant does not do so but produces a draft budget at the hearing.
  • District judge gives directions including for five experts, a five day trial and then limits claimant’s post CMC costs to recoverable court fees.
  • Unsuccessful appeal seeking relief from sanctions to the circuit judge.
  • Second appeal with leave of the Court of Appeal to Jackson and Lindblom LJJ.

The judgment

Although the case had never been allocated to the multitrack under CPR 26.5 so rule CPR 3.13 (costs budgeting) did not yet apply, that made no difference to the requirement to file a costs budget. “The litigation was self-evidently a multi-track case”, said Jackson LJ. As costs budgets should be fixed at the same costs management hearing – (no CPR cited for this requirement, only a reference to a Question and Answer book published by Sweet and Maxwell as an adjunct to the White Book), since none had been filed by the claimant, the judge had been right to limit his costs going forward to recoverable court fees.

Relief from sanctions?

Refused. It being self-evident that this was a multi-track case, misinterpreting the CPR was not a good reason for failing to comply. Taking all relevant factors into account, including that the application would involve another CMC, thereby adding both to the costs and to the length of the litigation, the decision below was one that was open to the judge to make:

“Other judges might have taken a more lenient view. The crucial point for present purposes is that the judge made no error of principle. He arrived at a decision which he was entitled to reach within the ambit of his discretion. In the result, I would reject all of the claimant’s grounds of appeal.”

Did it matter that the decision would mean that either Mr Jamadar’s solicitors would have to fund the case going forward personally and work for nothing, or alternatively, that the costs of doing so would be visited upon the firm’s insurers? Not in the least. The court dealt with that in the following way:

“I should record that any harshness of the order has been mitigated by the fact that the action subsequently settled, so this is not a case which has proceeded to trial at the expense of the claimant’s solicitors or their insurers.”

So that’s all right then. Solicitors just need to remember to comply with rules that have yet to apply to the case in point, and make sure that they follow what is written in books as well as the Civil Procedure Rules themselves.

Mediation in costs

Mediation has long since been important in resolving litigation, but mediating the costs is much more recent. However, there are now several decisions indicative of what the court will do if one party unreasonably refuses or ignores a request to mediate the costs as an alternative to detailed assessment.

The “Phone Hacking” litigation is the latest and most important example given that the judgment was delivered by the Senior Costs Judge. In Various Claimants v Mirror Group Newspapers Ltd (SCCO, 4 October 2016), Master Gordon-Saker was asked to adjudicate on an offer for the base costs of just over £2 million. Having done that, he turned his attention to the costs of the detailed assessment. Whether they should be paid on the standard or indemnity basis depended upon the view he took about discussions that had taken place about mediation.

Curiously, in view of the outcome, it had been the Mirror which had first proposed mediation. The Various Claimants thought that that was a good idea and had suggested former Senior Costs Judge Peter Hurst as the mediator. Letter after letter followed, but the Mirror took no notice and the matter ended up back before Master Gordon-Saker. His view about the conduct of the Mirror?

“I have no hesitation in concluding that the defendant has behaved unreasonably in failing to engage in the process of discussing at least the possibility of alternative dispute resolution and mediation in particular, and given that the common base costs have been agreed, it seems to me that there was no reason for pessimism as to the outcome of any mediation. … It seems to me, therefore, that the defendant’s conduct is unreasonable to a high degree and is such as to justify an award of costs on the indemnity basis.”

Important words, but with the uncertainty about proportionate costs and what stance the court will take when faced with a big bill but a small recovery, commercial good sense dictates that parties should consider mediation at an early stage in the detailed assessment proceedings. Further information about mediation in costs is available from Costs Alternative Dispute Resolution (CADR) and its Registrar Hannah Rawlins (hannah.rawlins@costs-adr.com) and also from Victoria Square Chambers (clerks@victoriasquarechambers.co.uk), both of whom have specialist mediation panels.

The headnotes and full texts of the cases below are available to online subscribers at www.costslawreports.co.uk. Follow Costs Law Reports on Twitter to be notified of new cases as soon as they are published.

New cases this month

FPH Law (a Firm) v Brown (t/a Integrum Law) [2016] 5 Costs LO 733: Judgment on preliminary issue in proceedings for damages for loss of chance where a conditional fee agreement had been ruled unenforceable for want of compliance with the CFA Regulations 2000.

R (Gopikrishna) v The Office of the Independent Adjudicator for Higher Education and Others [2016] 5 Costs LO 749: CPR 44.2, court’s discretion as to costs; appropriate costs order in judicial review proceedings.

R (Tesfay and Others) v Secretary of State for the Home Department [2016] 5 Costs LO 763: CPR 44.2, court’s discretion as to costs; appropriate order for costs in public law proceedings, following withdrawal of human rights certifications.

Hills v The Commissioners for Her Majesty’s Revenue and Customs [2016] 5 Costs LO 815: Costs in First-tier Tribunal: entitlement of the tribunal to make a costs order under the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009, where a late application for a case to be re-categorised as a complex case had already been granted.

K v K [2016] 5 Costs LO 839: Family Proceedings Rules 2010, rule 28.1; CPR 44.2(2), court’s discretion as to costs; proportionality in family proceedings.

IG Index Ltd v Cloete [2016] 5 Costs LO 855: Appropriate costs order where case stayed before issues had been determined at trial.

Jamadar v Bradford Teaching Hospitals NHS Foundation Trust [2016] 5 Costs LR 809: Costs budgeting: failure to serve a costs budget in compliance with CPR 3.13; automatic sanctions under CPR 3.14; factors applying on application for relief under CPR 3.9.

Dawnus Sierra Leone Ltd v Timis Mining Corporation Ltd and Another [2016] 5 Costs LR 819: Factors to apply on an application for disclosure of third party funder’s identity under CPR 25.14(2)(b).

Marks and Spencer plc v Asda Stores Ltd [2016] 5 Costs LR 837: Costs management orders under CPR 3.15; factors under CPR 44.4(3) to be taken into account in assessing proportionality in a costs budget having regard to CPR 44.3(5).

MA Lloyd & Son Ltd v PPC International Ltd and Another [2016] 5 Costs LR 853: Jurisdiction to make a wasted costs order under s 51(6) Senior Courts Act 1981 against solicitor personally; solicitor liable to pay wasted costs as a result of unmeritorious applications in the conduct of the litigation.

Agents’ Mutual Ltd v Gascoigne Halman Ltd and Another [2016] 5 Costs LR 893: Costs management orders under CPR 3.15: the court’s powers of costs management in order to express approval or disapproval of particular elements in a costs budget.

In the Matter of the Human Fertilisation and Embryology Act 2008 (Case V) [2016] 5 Costs LR 899: Applicability of costs orders made in family law cases during their progression in order to avoid delays experienced by applicants in obtaining payment of their costs.

AB v CD (No. 2: Costs) [2016] 5 Costs LR 909: Award of costs in high value matrimonial proceedings; principles to apply where there had been material non-disclosure by the wife but the husband had been guilty of misconduct; variation of the “no order” principle under FPR 2010 rule 28.3.

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