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Harries v Summers, Cardiff County Court, 25 April 2007

24 May 2007
The issues

Costs – proportionality – applicability of the proportionality two stage approach in Lownds v The Home Office to summary assessment of costs – summary assessment.

The facts

The Claimant had a road traffic accident in May 2004. The Claimant was a passenger in the Defendant’s car when it left the road, mounted a verge and hit a sign post. She was injured. She alleged that Mr Summers was negligent. He alleged that the accident was caused by the Claimant suddenly grabbing his steering wheel. The claim was allocated to the Fast Track. The District Judge found for the Claimant and awarded the Claimant £3,017.12. The Claimant’s costs were ordered to be paid by the Defendant and those costs were summarily assessed in the sum of £7,881.63. The Judge had before him a statement of costs drafted many weeks before Trial but which was not signed or certified in any way. The District Judge disallowed the costs of the costs consultant who had prepared the Costs Schedule (£420.00) and reduced Counsel’s fees, by agreement, to the appropriate fixed fee of £500.00. The solicitors profit costs were reduced from £6,668.10 plus VAT to £2,000.00 plus VAT.

The Claimant appealed against that summary assessment.

The decision

The Claimant’s solicitors had argued that the District Judge should have adjourned the assessment to a detailed assessment because there was insufficient time to carry it our properly. There was nothing in this point however and there was no reason for the District Judge not to follow the usual Rule after a Fast Track Trial and summarily assess costs.

Secondly, the Claimant complained that the District Judge had not adopted the two stage approach approved in Lownds v The Home Office, ie that the Judge should look at the costs as a whole first and consider whether they are proportionate and the answer to which should inform the second stage of his exercise, namely consideration of the detailed breakdown in the statement of costs. The Defendant had argued that the two stage approach applied only to detailed assessments and not to summary assessments. However, in Bryen & Langley v Boston, the Court of Appeal had confirmed that the Lownds approach should be followed in summary assessments.

There were therefore on a summary assessment of costs on the standard basis, effectively 3 stages:-

a) A consideration and determination of whether the aggregate costs claimed in the statement were proportionate;

b) Consideration of the extent of the work for which a claim was made. If the aggregate costs were proportionate, the costs of work reasonably done were allowable. If the aggregate costs were disproportionate, the costs of only work necessarily done should be allowable;

c) A consideration of the costs for work held to be liable under (b). In all cases reasonable costs of such work were allowable.

In this case the District Judge had erred in failing to adopt the approach to proportionality required by Lownds. The appeal would therefore be allowed.

However, the statement of costs was nothing like the form of N260. The CPR imposed a number of procedural requirements, one of which was that the Statement of Costs should follow as closely as possible form N260 and had to be signed by the party or his legal representative. No such proper Statement of Costs had been filed, served or even prepared. Nor had it been signed. The defects had not been remedied. The significance of the signature was that the act of signing verified the contents of the bill as correct. The signature was not an empty formality. As had been stated in Bailey v IBC vehicles Ltd [1998] 3ALL ER 570 it was effectively the certificate by an officer of the Court that the receiving party’s solicitors were not seeking to receive in relation to any item more than they had agreed to charge their client. In effect, it was certifying that the indemnity principle had not been breached. In the absence of any other evidence from the receiving party such a signature was a precondition for any assessment. In the absence of a signature it is not open to a Court to assess any bill whether detailed or summary. In relation to the form of the statement, to the extent that the statement did not follow the form of form N260 precisely, it was up to the Judge’s discretion whether, on the form file and served, it was possible to conduct a summary assessment that was fair to both paying and receiving parties. Consequently, given that even at the time of the Hearing on Appeal there was no such statement, the Judge was unable to summarily assess the costs and the matter would regrettably be remitted for Detailed Assessment. Doing so the Court ordered that the Claimant should not claim any costs in relation to the Statement of Costs relied upon and in considering who should bear the costs of the Detailed Assessment the District Judge should take into account the fact that the Detailed Assessment was only required because of the Claimant’s default in not providing a Statement of Costs in proper form. In the terms of costs of the appeal, the assessors costs should be borne 75% by the Defendant and 25% by the Claimant and otherwise the Defendant should pay 50% of the Claimant’s costs of the appeal, to be the subject of a Detailed Assessment. These Costs Orders took into account not only the success of the Claimant in the appeal but also the Claimant’s conduct, including especially her persistent failure to comply with the CPR in relation to the Statement of Costs.

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The content on this page is provided for the purposes of general interest and information. It contains only brief summaries of aspects of the subject matter and does not provide comprehensive statements of the law. It does not constitute legal advice and does not provide a substitute for it.

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