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Awberry v Marley Building Materials Ltd, Court of Appeal, 12 January 2005

4 February 2005
The issues

Part 36 Payment – Withdrawal Of Part 36 Payment – Part 36 Payment Made By Mistake – Appeals

The facts

The Claimant had a claim for personal injuries against his employer. Liability was admitted by the Defendant. Proceedings were commenced and a Defence was filed which challenged quantum. The Defendants made a Part 36 Payment of £189,218.72 together with recoverable benefits of £20,781.28 equating to their valuation of the Claimant’s claim at £210,000.00 on 19th April 2004. On 7th May 2004 the Claimant accepted the Part 36 Payment. That notice was received on 11th May by the Defendants who on that day filed an Application for permission to reduce the sum in Court by £55,362.00. The reason for the application was because on or about 22nd April the Defendant’s solicitors discovered that the Claimant had received the sum of £55,362.00 under the terms of a personal accident insurance policy which was maintained by the employer in respect of all its employees. The District Judge refused to allow the payment in to be reduced.

The Circuit Judge allowed the appeal. The Claimant appealed to the Court of Appeal.

The decision

The Claimant relied on three grounds of appeal, namely that the Circuit Judge had applied the wrong approach to the appeal because he had considered how he would have exercised his own discretion before considering whether there was an error in the Judgment and reasoning of the District Judge; secondly that the Judge did not at any stage identify an error on the part of the District Judge and thirdly that he was not justified in concluding that the District Judge had failed to consider the argument on behalf of the Defendant that if it were not allowed to reduce its Part 36 Payment, it would have to pay the Appellant £55,000.00 more than its valuation of the claim.

1.The first ground of appeal – it was true that the Circuit Judge had expressed his own view about the proposed reduction before he had analysed the conclusions of the District Judge. However this had to be seen in context. He had already referred to CPR 52.11 (3) and established that his task was to review rather than to re-hear. It might have been better had the Judge given his judgment in a different order, but his failure to do so did not vitiate it.
2. The Second and Third Grounds of Appeal – the reasoning and conclusion of the Circuit Judge were correct. He had identified as common ground that the Payment into Court of a large sum had been the result of a simple mistake. It was known that the District Judge had made no factual findings resolving this issue as it then was. Whether or not the Circuit Judge had had in his mind the justice of the impact on the Defendant of refusing permission to reduce, the Circuit Judge was plainly correct to evaluate it. His analysis was that the injustice to the Respondent would be very considerable and that to the Claimant, very modest. This was because the Claimant could if so advised have fought on rather than accept the lesser sum. That analysis was undoubtedly correct.

Appeal dismissed.

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