PI Newsletter June 2019 – Dowling v Higgins – strike out of a claim as an abuse of process

In Dowling v Higgins (Stoke on Trent County Court 20.03.2019 before District Judge Isles) Grant Goodlad, representing the Defendant, was successful in an application to strike out a claim as an abuse of process, and in opposing the Claimant’s application to lift a stay of proceedings and to transfer the claim from Part 8 to Part 7.

The proceedings concerned a claim for damages for personal injury arising from a road traffic accident that had occurred on 11th July 2013. The applicable Protocol was the 2010 version of the Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents, with an upper limit of £10,000.00.

The Claimant submitted a Claim Notification Form on 14 March 2014, to which the Defendant’s insurers responded with an admission of liability.

The Claimant embarked on obtaining medical evidence. This was not complete before the expiry of the primary limitation period and in July 2016 the Claimant issued a Part 8 claim, following paragraph 5.7 of the Protocol and CPR 8BPD.16. As a result, on 3rd August 2016 a district judge made an order on paper that a general stay of proceedings be granted, and that the Claimant must apply to exit the stay on complying with the RTA protocol.

At the time the Part 8 claim was issued, the Claimant’s solicitors had already obtained reports from a consultant orthopaedic surgeon. Based on that evidence they valued the claim in a sum in excess of £10,000 but proceeded on the assumption that the Protocol upper limit was £25,000. That was a mistake because the later version of the Protocol, with an upper limit of £25,000, applies only in respect of accidents occurring after 31 July 2013.

The Claimant’s solicitors obtained further medical evidence from a clinical psychologist. They disclosed that, and the orthopaedic evidence, in November 2016 and on 12 December 2016 they sent a schedule of special damages and future loss amounting to a sum in excess of £17,000.

On 6 June 2017 the Claimant submitted a Stage 2 Settlement Pack offering to settle for £25,000. The Defendant’s insurers made a counter offer which was not accepted. By a letter dated 6 November 2017 the Claimant withdrew the offer that she had made in June.

In correspondence the Claimant’s solicitors then indicated an intention to seek further medical evidence from a pain management specialist. Following silence for some six months, the Defendant’s solicitors applied to strike out the claim. Shortly before the hearing of that application, the Claimant applied to lift the stay and to transfer the claim to Part 7. The hearing of the Defendant’s application was adjourned so that both applications could be heard together.

On 20 March 2019 the applications came before District Judge Isles for hearing. Before counsel for each side made submissions on the substantive applications, counsel for the Claimant raised three preliminary points, namely that the Defendant had not applied to lift the stay before making an application, that the Defendant’s evidence referred to without prejudice material, and that although the Claimant had purported to withdraw her £25,000 settlement offer that was ineffective because it had been done without the permission of the court which was needed to withdraw a Protocol Offer after the start of proceedings (CPR 8BPD. 10).

In relation to the first point (the stay) the Judge’s reaction was that it would not further the overriding objective for the hearing to be put off on this account and that the Defendant’s application should be read as impliedly seeking the lifting of the stay for the purpose of the application.

The next preliminary point raised on behalf of the Claimant was the assertion that the Defendant had referred to without prejudice correspondence, meaning to the Stage 2 pack, relying upon CPR 36.28 which provides that the amount of a Protocol Offer must not be communicated to the court until the claim is determined.

The Judge accepted submissions on behalf of the Defendant, demonstrated by reference to the definitions in CPR 36.25 and in paragraph 7.64 of the Low Value Protocol, that the contents of the Stage 2 pack are not the Protocol Offer, that being the parties’ final offer set out in Part B of the Court Proceedings Pack whereas the stage 2 pack is disclosed to the court in Part A of the Court proceedings Pack.

Counsel for the Claimant then conceded that as the Stage 2 offer did not amount to the Protocol Offer the Claimant had not needed permission to withdraw it and that this dealt with his third preliminary point.

Both parties’ counsel then made submissions on the substantive applications. The Defendant relied heavily on the judgment of HHJ Pearce sitting at Liverpool in the unreported case of Lyle v Allianz Insurance PLC 21 December 2017 (referred to in note 8BPD.16.1 in the White Book).

The Judge in her judgement concluded

  • That the protocol limit that applied was £10,000 based on the protocol applicable at the date of the accident
  • That as at July 2016 when the Part 8 claim was issued the Claimant’s side were in possession of orthopaedic evidence and then valued the claim at more than £10,000
  • That although the Claimant may have been mistaken regarding the protocol limit, the claim was wrongly issued as a Part 8 claim because the protocol no longer applied as the claim was then valued at more than the upper limit of the protocol.
  • On 6.11.2017 it was clear that when the Claimant withdrew her Stage 2 offer the claim no longer proceeded under the low value protocol so by that date, whether or not there had been a misapprehension of the protocol financial limit, the Claimant should have applied for directions.
  • The order granting the stay was specific, with a positive requirement on the Claimant to apply to the court on complying with the protocol.
  • As at 12.12.2016 when the Claimant valued special damages and future loss at over £17,000 it was reasonable to have known that this would take the value of the claim above £25,000. This was significantly before the Claimant submitted her Stage 2 pack so even on the misapprehension that the higher protocol limit applied the matter was not suitable for the portal.
  • The Defendant’s enquiry whether the Claimant was going to transfer to Part 7 was met with “radio silence” beyond the Claimant saying in March 2018 that they were gathering evidence

From the above the Judge was satisfied that there had been breaches by the Claimant and she went on to consider whether they crossed the high hurdle to amount to an abuse of process. In this the Judge was assisted by, although not bound by, the decision in Lyle.

  • There was a difference here in that in the instant case it was the Defendant who had made an application and it then took the Claimant until December 2018 to make her own application, which compounded the Claimant’s behaviour.
  • Despite submissions in this respect for the Claimant, the Judge could see little to distinguish this case from that of Lyle. The Judge went through a number of similarities including that the conduct of the Defendant in the instant case appeared to have been no different from that of the Defendant in the Lyle case
  • The court has to take a balanced approach and apply the overriding objective
  • Whilst it was suggested by the Claimant’s counsel that the situation could be remedied by a sanction in costs the Judge bore in mind as a further concern that in March 2018 the Claimant was said to need further evidence from a pain management specialist yet twelve months down the line this appeared to be no further on, which was another example of the Claimant sitting behind the stay to build a case at a time and pace they saw fit
  • On her findings the solicitors for the Claimant should have addressed the value of the claim:
  • – At issue, when they got it wrong
    – On receipt of the orthopaedic evidence when the value of the claim was over the protocol limit, but they got it wrong
    – On serving the Schedule of Loss, when again the value of the claim was over the protocol limit, but they got it wrong
    – Also, and more importantly when they withdrew the Claimant’s Stage 2 offer in November 2017 the Claimant’s solicitors knew that the claim should have exited the protocol
  • The Claimant should have proceeded under the Personal Injury Protocol, and the Defendant would have had input into the experts instructed and involvement in rehabilitation
  • The stay was obtained under a false pretext and the delay had not only not allowed the Defendant to be involved but also has caused the court not to be involved. If the court were to lift the stay, then the Defendant would be left with that state of affairs and an award of costs cannot and will not alleviate that deficit.

The Judge then said that taking all matters into account this was one of those rare cases that met the test of abuse. She refused the Claimant’s application and granted the Defendant’s application with an order for costs in favour of the Defendant and on the express basis that the effect of her order was to disapply Qualified One Way Costs Shifting.