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	England and Wales High Court (Senior Courts Costs Office) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Senior Courts Costs Office) Decisions >> Chappell v De Bora’s of Exeter (A Firm) [2004] EWHC 90020 (Costs) (29 January 2004) URL: http://www.bailii.org/ew/cases/EWHC/Costs/2004/90020.html Cite as: [2004] EWHC 90020 (Costs)

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No.3 of 2004

Chappell v De Bora’s of Exeter (A Firm)
29 January 2004
His Honour Judge Overend (Sitting with Costs Judge Wright at Exeter)

The Claimant’s claim was in respect of the personal injuries she suffered when she fell down some steps at the Defendant’s shop in Exeter in December 2000. She claimed that the accident was caused by the negligence of the Defendant in that the steps were obscured from view by changing room curtains. The Claimant’s injuries as a result of the fall included a dislocated elbow and a wrist which was fractured in two places. She also claimed damages for associated pain and financial loss.

The Claimant who lives near Exeter instructed solicitors in Exeter, Messrs Slee Blackwell, in January 2001. They interviewed her at their offices with a witness who had inspected the scene of the accident. They prepared statements and on 5 March 2001 they prepared a risk assessment estimating her prospects of success at 70%. They entered into a CFA with her on 29 March 2001 which included a success fee of 71%. They also arranged a policy of ATE insurance and corresponded with DAS, the legal expenses insurers with whom the Claimant had an existing BTE insurance policy.

DAS said that under the terms of her policy with them the Claimant was obliged to instruct solicitors who were on their panel for any work which had to be done before the issue of proceedings although she was entitled to instruct the solicitors of her choice for the purpose of the proceedings themselves should proceedings be necessary.

On 29 March 2001, as soon as the CFA and ATE policy had been entered into, the solicitors (who were not on the DAS panel) wrote a letter before action. Thereafter they took a statement from another witness, obtained two reports from a local consultant orthopaedic surgeon, obtained the Claimant’s medical records from the Exeter NHS Trust and corresponded with her GP and her employers. The Defendant’s solicitors alleged contributory negligence and offered to agree an 80/20 split on liability. This was not agreed and so the potential issue of contributory negligence was not resolved.

Eventually in October 2002 the Defendants solicitors offered to settle the matter in the sum of £31,156 plus costs. This offer was accepted but the issue of costs could not be agreed. Costs only proceedings were issued and an order was made on 1 May 2003 for a detailed assessment of the Claimants costs.

A detailed assessment took place on 11 September 2003. The base costs and disbursements were agreed in the sum of £5,600. The success fee was allowed at 55% and the ATE insurance premium was allowed at £52.50.

The Defendant was given permission by the District Judge to appeal in respect of the issue as to whether it was reasonable for the Claimant to enter into a CFA with a success fee and ATE insurance with the solicitors of her choice in circumstances where BTE insurance was available but the Claimants chosen solicitors were not on the BTE insurers panel. The Defendant also asked for permission to appeal against the District Judge’s allowance of a 55% success fee but the District Judge refused permission to appeal in respect of that issue.

At the hearing of the appeal it was accepted by the parties that, although no evidence had been given on the point, it was fair to assume that the nearest firm of solicitors to the Claimant’s home who were on the DAS panel would be in Salisbury or Bristol.

The Defendant’s counsel Mr Benjamin Williams, referred (among others) to the judgments of the Court of Appeal in Sarwar v Alam [2002] 1 WLR 125, Callery v Gray [2001] 1 WLR 2112 and Sullivan v Co-Operative Insurance Society Ltd [1999] 2 Costs LR 1158. He submitted that the onus was on the Claimant to show why it was reasonable, on the standard basis, that the more expensive route of proceedings under a CFA with ATE insurance should have been adopted.

Mr Williams submitted that solicitors on the DAS panel up and down the country conducted very many cases no less serious and complex than the present case on a regular basis. He accepted what the Master of the Rolls had said in Sarwar v Alam:

"41. In this case we are concerned only with a relatively small personal injury claim in a road traffic accident. We are not concerned with claims which look as if they will exceed about £5,000, and we are not concerned with any other type of BTE claim. We have no doubt that, if a claimant possesses pre-existing BTE cover which appears to be satisfactory for a claim of that size, then in the ordinary course of things that claimant should be referred to the relevant BTE insurers."

However he submitted that the logic of the Court of Appeal’s judgment in Sarwar v Alam applied to other cases such as the present one where the facilities offered by DAS were adequate.

Mr Williams also asked for permission to appeal against the District Judge’s allowance of a success fee of 55% and submitted that the District Judge should have taken into account the fact that the case was settled without the issue of proceedings as was required by Section 17.8(2) of the Costs Practice Direction. He submitted that the success fee should be reduced to 20%.

The Claimant’s counsel, Mr Jonathan Dingle, submitted that this was not a straight forward multi-track case. Liability was never determined and allegations of contributory negligence played a significant part in the negotiations which led to an offer being made which was accepted. The amount of the damages which was in excess of £31,000 reflected the complexities. It had been reasonable for the Claimant to go to solicitors in Exeter to handle her case rather than to solicitors in Bristol or Salisbury. He submitted that the costs which the District Judge had allowed were proportionate in relation to a multi-track case of this nature.

The learned Judge concluded that it was reasonable in a case of this kind for the Claimant to instruct the solicitors of her choice in Exeter rather than DAS panel solicitors the nearest of whom would have been so many miles away from where she lives. Accordingly he dismissed the appeal in so far as it related to the Claimant’s choice of solicitor.

With regard to the issue as to whether a 55% success fee was too high in a case where proceedings had not been issued, he referred to Section 11.7 of the Costs Practice Direction which states that in considering the factors to be taken into account in assessing an additional liability, the court will have regard to the facts and circumstances as they reasonably appeared to the solicitors or counsel when the funding arrangement was entered into and at the time of any variation of the arrangement. It seemed to him that that was the provision which the District Judge had had in mind when reaching the decision about the level of the success fee.

However what the court in this case was concerned with was the assessment of costs in costs only proceedings. Section 17.8(2) of the Costs Practice Direction (which is the Practice Direction to CPR Part 44.12A) provides that in cases in which an additional liability is claimed, the Costs Judge or District Judge should have e acc

regard to the time when and the extent to which the claim has been settled and to the fact that the claim has been settled without the need to commence proceedings.

The learned Judge said that the Defendant’s request for permission to appeal in respect of the level of success fee which had been allowed would be granted because in his view the District Judge had not addressed the question of the success fee in the way the Practice Direction required. In his view the District Judge should have allowed a success fee of 40% and he would substitute that figure for the 55% which had been allowed.

It then transpired that the Claimant had made a Part 36 offer to accept a reduced success fee of 33%. The time for acceptance of that offer had expired on 26 November 2003. Accordingly the Defendant would have to pay the Claimant’s costs of the appeal which would be on the standard basis until 26 November 2003 and thereafter on the indemnity basis such costs to be assessed if not agreed.