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Stillwell v Clancy Docwra Plc, Supreme Court Costs Office, 1 September 2009

10 December 2009
The issues

Costs – Part 36 – Small Claims Track.

The facts

On the 2nd December 2008 the Claimant accepted £750.00 in final settlement of a claim she had made for injuries to her foot. The case was settled before proceedings were issued. In November 2008 the Defendant’s insurers had made an offer to the Claimant’s solicitors of £750.00 “pursuant to Part 36″. On the 2nd December the Claimant’s solicitors accepted the offer of £750.00 on the basis that the provisions of Part 36 applied in relation to costs which fell therefore, they said, to be assessed on the standard basis failing agreement. Their costs, when presented, amounted to £6,727.68 including VAT. In February 2009 costs only proceedings were started and on the 10th March 2009 the District Judge made an Order that the Defendant pay the Claimant’s costs on the standard basis, to be determined by Detailed Assessment if not agreed. The Defendant meanwhile had filed an Acknowledgement of Service consenting to the making of such an Order. The Defendant had argued in its Points of Dispute that the claim should be subject to the small claims provision and assessed with the small claims limit in mind. Before the Costs Judge the Defendant argument changed subtly to the extent that it was argued that the wording of the Order did not fetter or limit the discretion of the Court; that it was open to the Costs Judge on Assessment to look at the level of damages; and that by analogy the small claims costs regime should be implemented. The Claimant argued that the terms of the settlement were clear and that the Defendant was attempting to go behind the Order by inviting the Court to allow only small claims fixed costs.

The decision

The Order provided for the costs to be assessed on the standard basis. It followed that if, having heard the arguments on assessment the Court concluded that the reasonably incurred and proportionate costs that it was just to allow were those that would be payable under the small claims regime, then there was nothing in the Order which restricted the Court from doing so. By the same token, if the Court was persuaded that although the claim settled for £750.00, significantly more work than would ordinarily have been the case in such a small claim had been needed then there was nothing to prevent the Court from being more generous and to allow higher costs than those payable under the small claims regime. The Defendant was seeking to argue, in effect, that the costs should be assessed by reference to the amount that would have been allowed had the case been brought as a small claim. It was not the Defendant’s case that the Court should allow the small claims costs without modification. The Defendant was correct in this and the Court was not precluded from assessing the costs with CPR 26.6 in mind.

Preliminary issue decided in favour of the Defendant.

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