Ho v Adelekun [2019] EWCA Civ 1988

Published: 26/11/2019 | Costs, News, Newsletters, Personal Injury


Hot on the heels of Aldred v Cham [2019] EWCA Civ 1780, this week we have had another judgment from the Court of Appeal on the personal injury fixed costs regime in Part 45 – Ho v Adelekun [2019] EWCA Civ 1988. This time the Court was considering whether the terms of an offer ousted the costs restrictions of Part 45.

The Facts

The claim in Ho v Adelekun left the Protocol when liability was denied. The claimant later accepted a Part 36 offer, which was drafted in the exact terms of the standard form N242A, with one exception. The words “such costs to be subject to detailed assessment if not agreed” had been added to the costs section of the offer. The agreement was recorded in a Tomlin order. However, a dispute then arose as to whether the parties had contracted for fixed costs or for conventional assessed costs.

A further complication was that the value of the claim had increased so that it exceeded the normal financial limit of the Fast Track. The claimant argued that the parties reasonably would have provided for a conventional costs assessment in light of the likely reallocation to the multi-track.

The Protocol

Section IIIA of the Protocol is clear that where a fast-track claim has left the Protocol, the only allowable costs are the fixed costs at CPR r. 45.29C, unless there are exceptional circumstances. CPR r. 36.20 sets out which of those fixed costs the claimant will be entitled to after accepting a Part 36 offer in such a claim. The question in Ho v Adekelun was whether the parties could and did contract out of those provisions.

The Decision

It was held on appeal that the claimant was entitled to fixed costs only. The reasoning behind the Court of Appeal’s decision was as set out below.

  • The Court found that given Part 36 itself (in particular, CPR r. 36.20) makes clear that the fixed costs regime under Part 45 is to apply in cases where a Part 36 offer has been accepted, any offer seeking to depart from those provisions is not a Part 36 offer.
  • The Court did not consider it to be a relevant factor that the standard wording of the offer referred to CPR 36.13 rather than CPR 36.20. This was on the basis that the wording of the former provision in fact refers the reader to the latter provision.
  • The Court did not find the reference to “detailed assessment” to take the claim outside of the realm of fixed costs. This was on the basis that, although assessed costs and fixed costs are different to one another conceptually, the fixed costs regime does involve an “assessment” of sorts, in relation to disbursements for example. The Court considered it could not therefore be right to assume the word “assessment” was intended to negate fixed costs.
  • The Court reminded itself that the fixed costs regime is designed to ensure both sides begin and end the proceedings with the expectation that fixed costs is all that will be recoverable. The Court concluded that this would have informed the parties’ interpretation of the offer.

Comment

Parties should be aware that, based upon this decision, any offer purporting to contract out of Part 45 in relation to a fast-track claim which has left the Protocol will not constitute a Part 36 offer.

Although the reference to “detailed assessment” was not ultimately fatal for the defendant in this case, defendants should be careful as to how any references to “assessment” are drafted in both settlement offers and consequent consent orders under the Protocol in order to ensure their intentions are clear.