Legal Watch:Personal Injury21st May 2014Issue: 019

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In This Issue:

• Employers’ Liability

• Civil Procedure/Service Of A Claim Form

• Costs

• Court Ruling On “Fundamental Dishonesty”

• Jackson/Mitchell

Employers’ LiabilityThe case of Abbott v Cannock Chase District Council [Lawtel

16/05/2014] is a reminder that the burden of proving negligence

is on the claimant.

The claimant’s deceased husband had been employed by the

defendant as a bricklayer during the 1970s. In January 2014

he died from mesothelioma. Before his death, the claimant

took down a written note of her husband’s allegation that

he had been exposed to asbestos fibres and/or dust during

his employment with the defendant. The particulars of that

note formed the basis of the claim: that the deceased had

been exposed to asbestos when, over the course of about

a week, he had carried out work on the ceiling of a bricked

construction in a cemetery. His account was that he had had

to mix asbestos fibres with water to form a paste, which he

then applied to the ceiling. The court heard evidence from

those who had worked at and were familiar with the cemetery,

and it had the benefit of a joint expert report and asbestos

surveys carried out at the cemetery. The issue was whether

the deceased had been exposed to asbestos fibres and/or

dust while working at the cemetery.

‘...the claimant had not discharged the burden of showing that (the deceased) had used any form of plaster or decorative covering which contained asbestos...’

Dismissing the claim, the deputy High Court judge held

that the deceased had worked at the cemetery sometime

between 1972 and 1977, and probably in 1976 or 1977,

when he had applied some paste or decorative finish to the

ceiling of one of the buildings there. The court was unable

to determine what product he had used on the ceiling. It

was satisfied that the note the claimant took down was the

deceased’s best recollection of what had occurred and there

was no doubt that he had genuinely believed that he had

worked with asbestos whilst at the cemetery. The court was

also satisfied that the ceiling the deceased worked on had

not been altered or replaced since that time and that there

were three separate asbestos surveys which had found no

relevant asbestos. That evidence tended to suggest that

no asbestos was present. In the circumstances, the court

was driven to conclude that, whatever the deceased had

genuinely believed, the claimant had not discharged the

burden of showing that he had used any form of plaster

or decorative covering which contained asbestos whilst

working at the cemetery.

Civil Procedure/Service Of A Claim FormThe following extracts from CPR are relevant to this report.

3.10 Where there has been an error of procedure such as a

failure to comply with a rule or practice direction –

(a) The error does not invalidate any step taken in the

proceedings unless the court so orders; and

(b) The court may make an order to remedy the error

6.4

(1) …the court will serve the claim form except where –

(a) A rule or practice direction provides that the claimant

must serve it;

(b) The claimant notifies the court that the claimant wishes

to serve it; or

(c) The court orders or directs otherwise.

In Stoute v LTA Operations Ltd (2014) EWCA Civ 657 the

appellant/claimant, a professional tennis player, had alleged

that he had been discriminated against by the respondent/

defendant on the grounds of race. After unsuccessful

attempts to issue a claim form in the High Court and the

Central London County Court, he was incorrectly advised

that he had to issue the claim in the County Court Money

Claims Centre, which contrary to his written directions,

served the claim form on the defendant, rather than

returning it to the claimant for service under CPR 6.4(1). He

notified the defendant that the claim form had been served

contrary to his instructions to the court and the defendant

consequently accepted that service was ineffective. It had

appeared that the claimant had not wanted to serve the

claim form as he was awaiting the outcome of misconduct

proceedings that the defendant had brought against him.

He also applied to extend the time for service of the claim

form under CPR 7.6. A district judge’s decision holding

that the court’s service had been effective and granting

the application for an extension of time for the service of

the claim form was overturned on appeal. The claimant

appealed against that decision. The issues were whether (i)

the court’s service of the claim form had been effective; (ii)

CPR 7.6 applied in the instant case; (iii) if service had been

effective, whether the district judge had erred in extending

time for the service of the particulars of claim.

Allowing the claimant’s appeal, the Court of Appeal held that

it was necessary to begin by asking whether CPR 3.10 which

dealt with the consequences of a procedural error, applied

in the instant circumstances. The service of the claim form

by the court, in disregard of the claimant’s notification that

he had wished to effect service himself, was an error of

procedure under CPR 3.10. There was no reason why the

rule should not apply where the error had been an error

of the court, the language was not confined to errors by a

party and the policy considerations which underlay the rule

seemed to be the same whether a procedural mistake was

a party’s or the court’s responsibility. There was no reason

why CPR 3.10 should not be applicable where there had

been a breach of CPR 6.4(1). The possibility of prejudice to

a claimant was not a reason for treating premature service

by the court as a nullity. Insofar as a claimant might have

suffered some tactical disadvantage, the damage would

have been done whether service was a nullity, so that it

would have to be effected afresh, or not. Any procedural

prejudice could be addressed by the grant of an appropriate

extension. However, if there was some important reason why

in a particular case service had to be effected by a claimant,

an order could be made under CPR 3.10(a) invalidating the

court’s service. The court’s service of the claimant’s claim

form had been effective service.

CPR 7.6 was not applicable in the instant case. That rule

applied to cases where service had not been effected within

the time limit under CPR 7.5, whereas in the instant case

CPR 3.10 was relied on to establish that service had been

effected, albeit by the wrong person.

Notwithstanding the importance attached in guideline

cases to a systematic approach being taken to factors

identified in CPR 3.9, a decision was not automatically

bad in law because they had not been individually set out

and considered. It was clear that the district judge had

considered all the circumstances, including the particular

CPR 3.9 factors that were relevant. The claimant’s failure

to serve the particulars of claim could not be described as

intentional; he had not served them as he had not believed

that the claim form had been served. The district judge had

been entitled to take into account the delay and confusion

caused by the claimant’s misguided attempts to obtain an

extension, but it did not follow that those considerations

should have been decisive. He had been entitled to take

the view that, however unsatisfactory the conduct of the

claimant or his solicitors had been in that respect, it was

outweighed by the reasons for granting permission.

CostsIn Finglands Coachways Ltd v O’Hare (Protected Party)

(2014) EWHC 1513 (QB) we have an important decision on

the proportionality of costs under the cost rules applying

prior to 1 April 2013.

The respondent/claimant had brought a personal injury

action against the appellant/defendant which was later

discontinued. The claim was originally estimated to be worth

over £3m. The defendant’s bill of costs was approximately

£60,000. In his points of dispute, the claimant did not

assert that the defendant’s costs were disproportionate

overall. However, during the assessment of costs hearing

his representative raised points about the proportionality

of various individual items such as conferences with

counsel. The judge commented on the “necessity” and

“reasonableness” of some items and reduced the bill to

approximately £37,800 plus interest.

In its appeal the defendant argued that the judge had erred

in applying a test of necessity, rather than reasonableness,

when there had been no finding that the costs claimed were

disproportionate.

Dismissing the appeal, the High Court judge held that

on a number of occasions in the course of the costs

assessment the judge used the terms “necessary” and

“need” indiscriminately. That was not fatal to his decision.

The context suggested that he had used those terms in

their ordinary sense to convey a notion of justification when

enquiring whether the costs were proportionate. He should

not be taken as applying the test of necessity.

Even if the judge had applied the test of necessity, he was not

wrong to do so. CPR 44.4(2) of the old rules meant that the

court would, of its own initiative, disallow disproportionate

costs even if the paying party had not raised the point.

Further, even if a bill overall was not disproportionate, that

did not preclude the judge from concluding that specific

items were disproportionate and then applying the dual

test of necessity and reasonableness to those items. It was

contemplated in Lownds (2002) that if costs as a whole

were proportionate, all that was normally required was

that each item should be reasonably incurred. However,

the use of the qualification “normally” made it clear that it

was not a hard and fast rule. Therefore, in assessing costs

under the old CPR a court could consider on an item-by-

item basis whether the particular cost was proportionate

and necessary even if costs were proportionate on a global

basis. The judge had not misdirected himself in law.

‘CPR 44.4(2) of the old rules meant that the court would…disallow disproportionate costs even if the paying party had not raised the point’

Court Ruling On “FundamentalDishonesty”One of the exceptions to Qualified One Way Costs Shifting

(QOCS) is where the court makes a finding of “fundamental

dishonesty” on the part of the claimant and an order for

costs may then be made in favour of the defendant to be

enforced against the claimant’s assets.

The first report of such an order has arisen from the case

of Gosling v Screwfix and Anor, (Cambridge County Court),

in which the judge found the claimant had significantly

exaggerated the extent of his injuries following a fall from

a ladder.

The defendants had adduced surveillance evidence which

showed the court that the claimant had exaggerated his

injuries. The County Court judge ordered the claimant to pay

the defendants’ costs on an indemnity basis. He held that in

significantly exaggerating the extent of ongoing symptoms

the claimant’s conduct was dishonest and designed both to

deceive and give a false impression. He also held that the

dishonesty, which impacted on about half the value of the

claim was “on any view” sufficient to be characterised as

fundamental. As a result, he was satisfied on the balance

of probabilities that the claim was fundamentally dishonest.

CommentAs we begin to see the demise of cases funded under old

style CFAs, the relevance of QOCS will increase and so will

the need for defendants to take steps to mitigate its impact.

Effective and early Part 36 offers will be the principle tool

but costs orders obtained against the claimant during the

course of the proceedings will also be important. A finding

of fundamental dishonesty will be relatively rare, but as

this case illustrates, defendants must be vigilant for cases

where it is relevant.

The claimants appealed and argued that the judge was

wrong to characterise their application for an extension of

time as an application for relief from sanctions and that the

costs judge’s decisions allowing the extension and refusing

to set aside that order, were case management decisions

with which the judge was not entitled to interfere.

Allowing the appeal, the Court of Appeal (including Jackson

LJ) held that the claimants’ application for an extension was

made before the expiry of the time allowed for filing the

points of dispute. Given CPR 23.5, the fact that the court

staff did not date stamp the application until the following

day was immaterial. An application for an extension of

the time to take any particular step in litigation was not

an application for relief from sanctions, provided that the

applicant filed his application notice before expiry of the

permitted time period. That was the case even if the court

dealt with the application after the expiry of the relevant

period. That remained the case following the recent civil

justice reforms. It followed that the costs judge was dealing

with a straightforward application to extend time under CPR

3.1(2)(A) and the principles concerning relief from sanctions

Jackson/Mitchell

An application for an extension of the time …was not an application for relief from sanctions, provided that the applicant filed his application notice before expiry of the permitted time period.

The case of Hallam Estates Ltd and another v Baker (2014)

EWCA Civ 661 has already attracted widespread publicity

and a good deal of comment. It confirms:

a) That parties may agree sensible extensions of time

before a time limit has expired:

b) That the courts will approve such extensions provided

that the conduct of the litigation would not be disputed

and in particular any threat posed to an existing court

date;

c) That in these circumstances contested applications,

which take up court resources and incur unnecessary

costs should be avoided.

The appellants/claimants had brought defamation

proceedings against the defendant/respondent, which

were dismissed. They were ordered to pay her costs. The

defendant served her bill of costs eight months late. Six

days before the claimants were required to serve their

points of dispute, they asked the defendant for a 21-day

extension of time. She did not agree to it and on the day the

claimants should have served their points of dispute they

applied for an extension of time; their application was issued

by the court the next day. The costs judge dealt with the

matter ex parte and granted the extension. The defendant

unsuccessfully applied for that order to be set aside and the

claimants served their points of dispute within the extended

time for doing so.

The defendant appealed against the costs judge’s refusal

to set aside his order granting the extension. The judge,

allowing the defendant’s appeal, found that the claimants’

application for an extension of time was issued out of time

and therefore they were seeking relief from sanctions which

the costs judge should not have granted as rules should

be complied with. He set aside the costs judge’s order and

therefore held that the points of dispute were not points of

dispute at all and the defendant was entitled to a default

costs certificate under CPR 47.9(4).

in Mitchell did not apply. It was incumbent on the costs judge

to deal with the application in accordance with the recently

amended overriding objective, which he had. The claimants

had made a reasonable application for an extension of time,

which did not imperil any future hearing dates or otherwise

disrupt the proceedings. The costs judge’s decision to grant

an extension was a proper exercise of his case management

discretion. The defendant’s application to set aside was

based upon the misapprehension that the costs judge had

granted relief from sanction. His rejection of her application

to set aside, for which he gave sensible reasons, was

also a proper exercise of his case management powers.

Accordingly the judge had erred in reversing that decision.

When the claimants asked the defendant to agree an

extension of time, they had given sensible reasons for the

request and the defendant should have agreed. Given her

own delays, she could hardly complain about that modest

extension. CPR 3.8 would be amended imminently. Once it

was, parties would be able to agree a time extension of up

to 28 days without reference to the court, provided that it

did not put at risk any hearing date. Under CPR 1.3 parties

had a duty to help the court in furthering the overriding

objective, which included allotting an appropriate share

of the court’s resources to an individual case. Therefore

legal representatives were not in breach of any duty to their

client when they agreed to a reasonable extension of time

which neither imperilled future hearing dates nor otherwise

disrupted the conduct of the litigation. On the contrary, by

avoiding the need for a contested application they were

furthering the overriding objective and also saving costs.

Similarly, the courts should not refuse and CPR 1.1(2)(f) did

not require them to refuse to grant reasonable extensions of

time in such circumstances.

(Obiter) The issue of whether the judge had erred in directing

that a default costs certificate be issued did not arise.

Nevertheless, the court addressed it. The defendants’

points of dispute would have become out of time once the

judge reversed the costs judge’s decision. As a result the

sanction in CPR 47.9(3) would have come into operation.

The effect of which was that the paying party could not be

heard further in the detailed assessment proceedings unless

the court gave permission. That was the only sanction under

the rules. CPR 47.9(5) prevented the issue of a default costs

certificate after the paying party had served its points of

dispute. That rule applied whether they were served before

or after expiry of the permitted time for service. It therefore

followed that if the receiving party wished to obtain a default

costs certificate, he had to file his request after expiry of

the time permitted for serving the points of dispute and

before the points of dispute were actually served. That did

not happen in the instant case and the judge did not have

the power to direct that a default costs certificate be issued.

CommentWhile on the face of it this is a sensible decision, it still

leaves practitioners with a dilemma in certain situations.

One party is in a position to comply with a court direction;

the other is not. The first party considers that the second

has no justification for requiring more time. The time limit is

imminent. The second party requests an extension of time.

What should the first party do?

If it refuses the extension the first party must make an

application for more time before the deadline expires.

If it fails to do so it will be obliged to apply for relief from

sanctions and applying Mitchell may fail, providing the first

party with a potentially massive tactical advantage. If the

application is made in time, the court will consider it in the

light of the overriding objective. If the extension is granted,

the first party may find itself criticised for opposing it and

suffer a penalty in costs.

The information and opinions contained in this document are not intended to be a comprehensive study, nor to provide legal advice, and should not be relied on or treated as a substitute for specific advice concerning individual situations. This document speaks as of its date and does not reflect any changes in law or practice after that date. Plexus Law and Greenwoods Solicitors are trading names of Parabis Law LLP, a Limited Liability Partnership incorporated in England & Wales. Reg No: OC315763. Registered office: 8 Bedford Park, Croydon, Surrey CR0 2AP. Parabis Law LLP is authorised and regulated by the SRA.

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With effect from 5 June 2014 the Civil Procedure Rules

are to be amended to allow parties some respite from the

impact of the decision in Mitchell.

CPR 3.8 will now read (emphasis added):

(3) Where a rule, practice direction or court order –

(a) requires a party to do something within a specified

time, and

(b) specifies the consequence of failure to comply,

the time for doing the act in question may not be

extended by agreement between the parties except

as provided in paragraph (4)

(4) In the circumstances referred to in paragraph (3) and

unless the court orders otherwise, the time for doing

the act in question may be extended by prior written

agreement of the parties for up to a maximum of 28

days, provided always that any such extension does not

put at risk any hearing date.

Introduction into CPR of the ‘buffer provision’