There was no rule that a failure to raise a point before the trial judge would preclude the raising of that point before the costs judge on a detailed assessment. Where a case had been heard on the multi-track and costs awarded on the standard basis, the costs judge was not entitled simply to rule that costs should be assessed on the fast track basis, but it was permissible to assess costs on the standard basis taking into account that the case should have been allocated to the fast track.

The appellant (D) appealed against a decision that, where the trial judge ordered costs to be assessed on the standard basis, the costs judge could assess the costs as if the case had been allocated to the fast track.

Background

The Claimant brought a claim for personal injury pleading that the claim exceeded £15,000, with a schedule of special damage of £30,309, though this was ultimately amended to claim past loss of £3,677.84 and future loss of £18,325 for the cost of a cleaner, together with a Smith v Manchester award. On 29.12.05, the claim was allocated to the multi track. The Defendant had suggested that it was a fast track case but consented to allocation to the multi track because of the schedule for £30,309.

At trial, judgment was awarded 75:25 in the Claimant’s favour. He recovered damages totalling £9,291.56. The Judge assessed Smith v Manchester at £5,000 but allowed nothing for future special damages. The Defendant complained about aspects of the Claimant’s conduct but the Judge refused to make any special costs Order, ordering that

"The Defendant to pay the Claimant’s costs of the action to be assessed on the standard basis if not agreed."

The Claimant’s Bill of Costs came to £78,458.65 including a 100% success fee. The Defendant argued proportionality, alleging that exaggeration of the claim had increased costs. The Costs Judge looked at allocation and held that, by March 2006, it was apparent that it was a fast track claim so she would assess costs thereafter accordingly. Costs were assessed at £41,845. The Claimant appealed unsuccessfully and the matter reached the Court of Appeal.

Court of Appeal decision

The Court observed that there was nothing uncommon about the circumstances of the case, and it raised points of general interest:

• Where the Trial Judge has in a multi track case ordered costs to be paid on the standard basis, to what extent is a Costs Judge free to rule that the case was in reality a fast track case and assess trial costs on a fast track basis?
• Is this a matter which a paying party has to raise before the Trial Judge or be precluded from raising the point thereafter?
• Should a party obtain a ruling from the Trial Judge as to whether a case should have been disposed of within a day when in fact it was not?
• If the Costs Judge is free to consider whether a case should have been allocated to the fast track, how should he or she approach assessment thereafter; can he or she simply say I am going to assess the costs of trial as if it was a fast track case or is it simply something to be taken into account when assessing the costs?

The Court held that CPR 44.3 and 44.5 are intended to work in harmony and the parties’ conduct may have to be considered under both. If what is sought is a special order as to costs which a Costs Judge should follow, that obviously should be sought from the Trial Judge. If it is clear that a Costs Judge would be assisted in the assessment of costs by some indication from the Trial Judge about the way in which a trial has been conducted, a request for that indication should be sought. But this did not mean a failure to raise a point before the Trial Judge will preclude the raising of a point before the Costs Judge.

The question of exaggeration had been raised before the Trial Judge who might have made a special order for costs, e.g. that the Claimant should only get 50% of his costs. But the fact that no special order had been made did not preclude the Costs Judge from considering whether the conduct of a party should preclude an award of costs for some particular item.

The Defendant had not sought an order that costs should be limited to those recoverable on a fast track basis, and in particular did not seek a ruling that only one day's trial costs should be allowed even though the case had gone into a second day. It might have been helpful if some indication had been given by the Trial Judge on those points, but the fact it was not raised did not prevent the Defendant raising with the Costs Judge "all the circumstances of the case", including the question whether the case was in reality a fast track case.

However, the appeal was allowed in part and the case remitted for re-assessment. The Costs Judge was not entitled simply to rule that she was going to assess the costs of trial as if the case were on the fast track. She should instead assessed costs on the standard basis, taking into account that the case should have been allocated to the fast track.

Simon Cradick's comment:

Thus, in answer to the questions posed by the Court of Appeal:

• Where the Trial Judge has in a multi track case ordered costs to be paid on the standard basis, a Costs Judge cannot simply rule that the case was in reality a fast track case and assess trial costs on a fast track basis.
• However, the Costs Judge is free to consider whether a case should have been allocated to the fast track, and, if so, take that fact into account when assessing costs.
• The Defendant who does not raise matters of conduct or allocation before the Trial Judge will not ordinarily be precluded from raising them before the Costs Judge.
• A party wishing to argue that a case should have been disposed of within a day when in fact it was not should seek an indication to that effect from the Trial Judge, but if he does not he would not be precluded from raising the point before the Costs Judge.

The case is thus a powerful negotiating and control tool for costs in any claim which proceeds in the multi track but which in reality is a fast track claim and should have been allocated to the fast track.

Simon Cradick, Partner
T: 029 2038 5464
E: simon.cradick@morgan-cole.com