piBlawg

the personal injury and clinical negligence blog

A collaboration between Rebmark Legal Solutions and 1 Chancery Lane

Trial by ambush?

In Hayden v Maidstone & Tunbridge Wells NHS Trust [2016] EWHC 1121 (QB) Foskett J, albeit with “considerable misgiving”, allowed a Defendant to rely on surveillance footage that had been disclosed so late that it caused the trial date to be vacated. The decision is not so much of interest because of its outcome but for the judge’s more general comments on the issue of when surveillance evidence might properly be served. Facts It was held that from May 2015, when their pain management expert expressed the view that it was possible the Claimant was “grossly exaggerating for the purposes of financial gain”, the Defendant had every reason to commission surveillance evidence. Its failure to do so until January 2016 was unexplained and unreasonable. A series of lengthy but less culpable delays thereafter meant that the edited surveillance was finally served by post on 24 March, Maundy Thursday and received on Tuesday 30 March. The Defendant’s application to rely on it came before Foskett J on 8 April who decided that the Claimant should have time to consider her position and that therefore the trial due to commence in the week beginning 11 April had to be vacated. When it came back before him later that month he considered the events leading to that outcome and decided that the interests of justice required the evidence to be admitted. However, he declined to reserve costs to the trial judge holding that this was the “clearest possible case in which the order should be that the Defendant should bear the costs thrown away by the vacation of the trial date on the indemnity basis”. The Defendant was also ordered to pay the costs of the Claimant’s experts considering the surveillance, again on the indemnity basis Points of General Application  In reaching this decision Foskett J made a number of useful observations on the approach that parties and the court should take to surveillance evidence. Lawyers on both sides would be well advised to take those points on board, particularly Defendant representatives considering when to disclose footage. At paragraph 1 the judge explained that he was giving the Claimant time to consider whether she in fact wanted to oppose the application on the basis that this type of application can backfire on Defendants and represent a bonus to Claimants. It’s easy to see how unconvincing footage, presumably the high water mark of a Defendant’s case, might lend weight to a Claimant’s case. At paragraph 31, in the course of reviewing the authorities, he reiterated that the question of whether or not there is an ambush does not require a sinister motive to be shown but asks only whether the behaviour is otherwise culpable. Thus a Defendant does not have to be shown to be acting in bad faith or sharply – what matters is the effect of the conduct on the Claimant’s ability to deal with the evidence fairly. The judge observed at paragraph 34 that were it necessary to find a deliberate attempt to wrong foot the Claimant then this could only be done fairly in a mini-trial of the solicitor’s conduct. This is the sort of satellite litigation which is to be avoided. Reassuringly for those advising Defendants it is clear from paragraph 36 that his decision is not to be taken as altering the well-recognised position that a Defendant is entitled to wait until a Claimant has nailed his colours to the mast in a witness statement and/or schedule of loss before serving surveillance evidence. Having considered paragraphs 71 and 71 of Judge Collender QC’s decision in Douglas v O’Neill [2011] EWHC 601 (QB) he held that the fact that footage existed and more significantly had been seen by experts was not determinative of the question of whether permission to rely on it should be given. Experts are capable of putting such material out of their minds when giving evidence, just as they know not to reveal matters discussed without prejudice. In this case the judge notes that the Claimant’s solicitors perceived it was inappropriate for the experts to be shown the surveillance footage before permission to rely on it was given but does not really deal with whether they were correct. One can see that if the experts’ knowledge of the footage is, while not determinative, a relevant factor it might be improper to share it with experts and then make the application. Conversely the experts’ opinion might be required to decide whether to make the application. He observed that any inadequacy in the rules dealing with surveillance was a matter for the Civil Procedure Committee but noted that two cases on that issue were heard in the Royal Courts of Justice on the same day. At paragraphs 44 to 46 he questioned whether case management might resolve many such issues. It is the experience of the Senior Master that Claimants often seek an order specifying a date by which surveillance evidence must be served and this is frequently resisted by Defendants. It was suggested that it would be prudent for Claimants to raise the matter with the court as soon as they are in receipt of expert reports which suggest there might be an issue and indeed for the court to raise it of its own motion at the case management stage. Finally, at Paragraph 47, once a Claimant’s case as to the level of disability is clearly articulated and the Defendant has an expert opinion suggesting the claim is “suspect”, an obligation arises actively to obtain surveillance evidence if proportionate. This is not therefore a decision which particularly advances the law but it is a useful insight into how courts will approach applications of this nature.

QOCS : applies to appeals?

Qualified One-way Costs Shifting: does it apply to appeals?   Yes, according to Edis J in Parker v Butler [2016] EWHC 1251 (QB), who held:   3.         If (as is likely to be the case here) the claimant's access to justice is dependent on the benefit of QOCS, that access will be significantly reduced if he is exposed to a risk as to the costs of any unsuccessful appeal which he may bring or any successful appeal a defendant may bring against him. ...   4.         The power to make enforceable orders for costs is designed to compensate successful parties for their expense in bringing or resisting claims, but it also has an effect of deterring people from bringing or resisting claims unsuccessfully. It is an incentive to resolve disputes and serves a public as well as a private interest. ...   9.         CPR 44.13 provides "(1) This Section applies to proceedings which include a claim for damages – (a) for personal injuries"   10.       The issue is, therefore, whether the appeal is part of the proceedings which include a claim for damages for personal injuries or whether it is separate from them and thus not subject to the regime. If it is separate from the proceedings which culminated in the trial, is it nonetheless a set of proceedings which includes a claim for damages?   17.       An appeal by a claimant against the dismissal of his claim for personal injuries is a means of pursuing that claim against the defendant or defendants who succeeded in defeating that claim at trial. There is no difference between the parties or the relief sought as there is between the original claim and the Part 20 claim. Most importantly, to my mind there is no difference between the nature of the claimant at trial and the appellant on appeal. He is the same person, and the QOCS regime exists for his benefit as the best way to protect his access to justice to pursue a personal injury claim. To construe the word "proceedings" as excluding an appeal which was necessary if he were to succeed in establishing the claim which had earlier attracted costs protection would do nothing to serve the purpose of the QOCS regime. ...

Claims of alleged fraud not exempt from Denton

“The court cannot ignore that insurers are professional litigants, who can properly be held responsible for any blatant disregard of their own commercial interests.” - Gentry v Miller & Anor [2016] EWCA Civ 141 at 34. Such was the warning sent to insurers by the Court of Appeal earlier this month in allowing a Claimant’s appeal against a decision to set aside default judgment in what the Defendant’s insurer alleged was a fraudulent claim. The Facts The Claimant, Mr Gentry, alleged that he was in a road traffic accident with a Mr Miller on 17th March 2013 in a claims notification form valuing the claim at under £10,000. On 2nd April 2013 Mr Miller’s insurer admitted liability. On 8th April the Claimant’s solicitors wrote requesting immediate payment of the pre-accident value of his car (being £16,000) and warning that until that was received he was hiring a replacement vehicle under a credit hire facility. Proceedings were issued against Mr Miller alone on 3rd July and on 8th August the Claimant obtained default judgement. At no point in this period did the insurer instruct solicitors and it replied to only one of seven letters. In late August the insurer made a voluntary interim payment of £14,000 and a Part 36 Offer of £1,870. A further interim payment of £2,000 was ordered in September and paid. At a disposal hearing on 17th October 2013, DJ Benson awarded the Claimant damages of £75,089 consisting mostly of hire charges. On receipt of notification of this award the insurer instructed solicitors who, on 25th November, issued an application referring to CPR 13.3 (1). On 10th February 2014 those same solicitors applied to come off the record for Mr Miller, to add the insurer as the second defendant and to set aside both the default judgment and the order of 17th October. For the first time they alleged that Mr Gentry and Mr Miller were well known to each other and that the claim was a fraud. The application to set aside was granted by DJ Henthorn on 17th March 2014 and on 4th February 2015 Mr Recorder Gregory (as he then was) dismissed the Claimant’s appeal. The decision of the Court of Appeal The Court of Appeal considered the applications under CPR 13.3 and 39.3. In relation to the former Vos LJ was satisfied that the Defendant had demonstrated that it had a real prospect of successfully defending the claim but had to consider under CPR 13.3 (2) whether the application was made promptly. The delay to the application of 25th November was inexcusable. In particular Vos LJ noted that the insurer: Failed to adduce any evidence of its postal systems to explain how documents might not have reached it; Must have been aware after admitting liability at the beginning of April 2013 that it was at risk if it did not defend or attempt to settle the claim; Did not instruct solicitors or investigate fraud in the seven months after that admission; Was repeatedly warned of hire charge risks so that the suggestion that it believed the claim to be small and therefore impliedly not worth investigating did not hold water; In ignoring those warnings allowed the claim to grow; While not notified of the default judgment of 8th August as promptly as it might have been, clearly knew that proceedings were on foot when it made a Part 36 offer on 22nd August; Must also have been aware of proceedings when it paid the interim payment ordered by the court; Upon receiving costs schedules on 19th and 23rd September sent “ahead of the upcoming application hearing”, made no enquiry as to what that hearing was about. The court’s analysis then continued by application of the Denton test. It was common ground that Mr Miller’s default in not filing an acknowledgment of service was serious or significant. The fact that it was not served with the proceedings gave the insurer some reasonable excuse or explanation but it could and should have protected itself when it knew proceedings were being issued by appointing solicitors to accept service on behalf of Mr Miller. Finally, looking to all of the circumstances and in particular factors a) and b) it was held that “insurers are in a particularly good position to conduct litigation efficiently and proportionately and to comply with rules and orders”. It cannot avail an insurer who knows the risk from the moment it admits liability to say it was not a party at the time. The application under CPR 39.3 to set aside the order of 17th October, despite the insurer having notice, (although not a copy), of that order since 25th October, was not made until 26th February 2014. It had not been made promptly and therefore, even if the insurer could show it had a good reason for not attending the trial and a reasonable prospect of success, the application could not be granted. Again, it would in any event probably have failed the third stage of the Denton test. Key Lessons There are two key lessons for insurers arising out of this decision. The first is the reminder at the start of this post that insurers will be treated as professional litigants capable of protecting their own interests. The second is that a credible allegation of fraud is not a trump card. When weighing the competing policy interests of the desirability of testing the allegation of fraud against the requirement that there be finality of litigation, the latter at least can outweigh the former. At some point the insurer must be left to bring its own action in relation to the fraud.

Evidence and interim payment applications

  The High Court has given useful guidance (which serves as a warning) to defendants on their evidential obligations when defending applications for interim payments. In Sellar-Elliot v Howling [2016] EWHC 443 (QB) Sweeney J refused permission to appeal an interim payment order by Master Cook and held that it was not enough for a defendant to rely – when defending an application for an interim payment – on the defence (supported by a statement of truth) and a witness statement from a solicitor confirming that expert evidence supporting the defence had been obtained.   The defendant must go further and provide the court with some reasoned response to the claimant’s expert evidence (which had been unilaterally served to support the application in this case).  Even though – in accordance with court directions – the defendant had since served expert evidence disputing the claimant’s points, the court had to judge the interim payment application on the evidence before it at the time of the application.  In other words, and drawing on the Court of Appeal’s decision in Test Claimants in the FII Group Litigation v Revenue and Customs Comrs (No 2) [2012] 1 WLR 2375, the court must be satisfied that if the case went to trial on the material before the judge at the time of the application that the claimant would succeed and would obtain a substantial amount of money. Defendants therefore bear an evidential burden “to raise matters, on the basis of evidence, which would justify the court in concluding that a claimant would not succeed in obtaining substantial damages”  Sweeney J held that: “…the mere fact that the Defendant’s causation case was supported by reputable expert opinion, and that the Defendant’s expert would dispute the Claimant’s expert evidence at trial, did not mean that, on the evidence, the Claimant had failed to persuade [Master Cook] that the requisite test was met” The message for defendants would seem to be therefore that when a claimant chooses unilaterally to serve expert evidence to support an interim payment application, defendants must serve an argued and detailed expert response, even when the court has already directed that expert evidence is scheduled to be disclosed at a later date The case is on Bailli: http://www.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWHC/QB/2016/443.html&query=title+(+Sellar-Elliott+)+and+title+(+v+)+and+title+(+Howling+)&method=boolean                        

Fixed Costs and Part 36 Offers

What is the effect of a claimant’s ‘beaten’ Part 36 Offer upon their costs in a low value personal injury case within the RTA or EL/PL Protocol where claimants' costs are fixed pursuant to CPR 45? This has been a vexed question since the introduction of the fixed costs regime , but one the Master of the Rolls giving the sole judgment of the Court of Appeal in Broadhurst & Anor v Tan & Anor [2016] EWCA Civ 94 has now answered with important and far-reaching consequences for litigators in this area. The Court of Appeal held that Parliament and the draftsmen of the amended Rules intended Part 36 offers to have costs consequences in cases where they were bettered at trial even where costs were usually fixed. This means that, per Rule 36.14(3), where a claimant makes a successful Part 36 offer, the court will, unless it considers it unjust to do so, order that the claimant is entitled to four enhanced benefits including "(b) his costs on the indemnity basis from the date on which the relevant period expired” and thus (as held) the “tension between rule 45.29B and rule 36.14A must, therefore, be resolved in favour of rule 36.14A”, the specific provision taking precedence over the general.    At paragraphs 30 and 31, the Court held that:    “...The starting point is that fixed costs and assessed costs are conceptually different. Fixed costs are awarded whether or not they were incurred, and whether or not they represent reasonable or proportionate compensation for the effort actually expended. On the other hand, assessed costs reflect the work actually done... ...Where a claimant makes a successful Part 36 offer in a section IIIA case, he will be awarded fixed costs to the last staging point provided by rule 45.29C and Table 6B. He will then be awarded costs to be assessed on the indemnity basis in addition from the date that the offer became effective. This does not require any apportionment. It will, however, lead to a generous outcome for the claimant. I do not regard this outcome as so surprising or so unfair to the defendant that it requires the court to equate fixed costs with costs assessed on the indemnity basis... a generous outcome in such circumstances is consistent with rule 36.14(3) as a whole and its policy of providing claimants with generous incentives to make offers, and defendants with countervailing incentives to accept them.” Whether this clarification will lead to an increase or decrease in litigation will remain to be seen. Certainly the current interpretation of this (formerly) knotty issue ought to remind all litigators, but particularly those acting for claimant parties, of the importance of early, well-pitched Part 36 Offers in both encouraging settlement and giving rise to another means of escaping the confines of the fixed costs regime.

Part 36 Offer: derisory or genuine?

The case of Jockey Club Racecourse Ltd v Willmott Dixon Construction Ltd  [2016] EWHC 167 deals with two interesting questions: (1) does a Part 36 offer have to reflect an available outcome in the litigation to be valid? (2) when is it a genuine attempt to settle liability?  The case concerned a defective roof at the racecourse at Epsom. The claimant offered to settle the issue of liability on the basis that the defendant would “accept liability to pay 95% of our client’s claim for damages to be assessed.” The issues of liability were ultimately resolved by consent wholly in the claimant’s favour. The claim was pleaded at in excess of £5m. The judge endorsed the remarks of Henderson J in AB v CD  [2011] EWHC 602  in which he drew the distinction between a genuine offer or ‘merely a lightly disguised request for total capitulation’. A request to a defendant to submit to judgment for the entirety of the relief sought by the claimant was not an ‘offer to settle’ within the meaning of Part 36. An offer to settle had to contain some genuine element of concession on the part of the claimant to which a significant value could be attached in the context of the litigation. Henderson J considered in the context of a road traffic accident that the offer of 95:5 was derisory. In Huck v Robson [2003] 1 WLR 1340 the Court of appeal held that although no judge would apportion liability 95:5, that was irrelevant. The offer reflected the fact that most claimants prefer certainty to the ordeal of trial and uncertainty about its outcome. They did not think it was merely a tactical step to secure the benefit of the incentives provided by the rule but provided the defendant with a real opportunity for settlement. In Jockey Club Racecourse Edwards-Stuart J. found that, although the Part 36 offer of a 95:5 split was not an outcome available to the court, it did not prevent it being a valid offer. Nothing had been changed by the addition to rule 36.17(5) of subparagraph (e) which requires the court to consider whether the offer was a genuine attempt to settle the proceedings. The judge then went on to consider whether it would be unjust to order the consequences which flow from a failure to better a Part 36 offer. He did not order the consequences to flow from 21 days after the date of the offer but allowed the claimant to have costs on the indemnity basis from the earliest date after that by which “the Defendant could reasonably have put itself in a position to make an informed assessment of the strength of the claim on liability”. That conclusion sits uneasily with the comments of the Court of appeal in its harsh decision in Matthews v Metal Improvements Co Inc [2007] C.P. Rep. 27 where the judge was criticised for deciding the case on the basis of reasonableness. The answer to the two questions I posed above is: (1) a Part 36 Offer does not have to reflect an available outcome in the litigation to be valid although this is less likely to be an issue in personal injury where contributory negligence can reduce a finding that a defendant is liable. (2) A genuine attempt to settle liability is one where the offer is not derisory and is one in which there is ‘some genuine element of concession on the part of the claimant, to which a significant value can be attached’. This will depend on the facts of each case although in the context of a personal injury claim an offer of less than a 5% reduction would be risky where the value is not high.

Expert evidence in road traffic cases

Is the evidence of an expert in cycling safety reasonably required in a personal injury claim arising out of an accident which the claimant alleges was caused by the highway authority’s breach of duty (in respect of maintenance, layout etc)? At a Case Management conference in the case of Allen v Cornwall Council [2015] EWHC 1461 the District Judge gave the claimant permission to rely on such evidence to deal with allegations of contributory negligence made by the defendant. He refused to grant the defendant permission to rely on its own evidence.  In the case of Liddell v Middleton (7th July 1995, Unreported), the Court of Appeal gave guidance as to the admissibility of expert evidence in road traffic claims. Stuart-Smith L.J. said that in such cases the function of the expert is to furnish the judge with the necessary scientific criteria and assistance based upon his special skill and experience not possessed by ordinary laymen to enable the judge to interpret the factual evidence of the marks on the road, the damage, or whatever it may be. What he is not entitled to do is reach conclusions on facts or give his opinion on whether there was a breach of duty. In Liddell the Court of Appeal found the ‘expert’ had overstepped the mark and given evidence which was entirely irrelevant and inadmissible. The defendant in Allen appealed the District Judge’s order and the case was heard by Green J. He would not interfere with what was a case management decision of the district judge. Green J found that the district judge was addressing a threshold issue as to whether the evidence should be admitted for the purpose of case management but, he had made it clear it was without prejudice to any more mature and considered view which a trial judge might take. He had not given the defendant permission to have its own report because it might see the expert evidence of the claimant and decide that it wanted to abandon allegations of contributory negligence altogether. Green J held that the district judge had not seen the expert’s report at the time he made his decision and therefore he was not in a position to assess its content; he took account of the fact his decision would not bind the trial judge. Green J thought that the facts of the case were somewhat unusual (as it was not a case of a collision with a pedestrian or another vehicle but one involving the condition and layout of the highway). He did not rule on the admissibility of the evidence but thought the judge had not acted outside the generous ambit afforded to a judge exercising his case management powers. Green J acknowledged the ‘practical force’ of the defendant’s complaint that the judge should have required the report to be prepared and produced before granting permission. Indeed the defendant’s suggestion that this would have been the appropriate course was commended as ‘sensible’. It is notably the course commended by the Court of Appeal in Casey v Cartwright in the context of low velocity road traffic accident litigation. But Green J did not think the judge had erred in not adopting this approach. This case raises an interesting question as to when exactly the threshold is reached for the granting of permission for expert evidence at the case management stage: when is expert evidence ‘reasonably required’ (CPR 35.1)? In Casey the question was whether, once the judge had seen the expert evidence, the issue itself had a ‘real prospect of success’. Liddell v Middleton and the decision in Allen tend to suggest that at the case management stage the question is no more than whether it is arguable that the evidence is admissible - the final decision rests with the trial judge. The questions the expert was to examine included where a cyclist should be positioned on a carriageway and whether he was cycling too fast or should have dismounted where visibility was poor. Do such questions require expert evidence? If so, why not in cases involving motorcycling, lorry driving and other modes of transport which may be outside the experience of a trial judge? It will be interesting to see what the trial judge decides. In the meantime it is striking that, at the appeal, Green J gave the defendant permission to rely on its own expert evidence before it had seen the evidence of the claimant. Draw what conclusions you will… (Ian Miller represented the defendant on the appeal)

Guidance as to Litigants-in-Person, a sign of the times?

The Bar Council, Law Society and Chartered Institute of Legal Executives has produced some joint guidance for lawyers in how to conduct themselves towards a litigant-in-person. The Guide (available at http://bit.ly/1IkTPig) remind practitioners of their professional obligations and that the growing rise in unrepresented parties should be regarded as a sign of the times, rather than a sign of there simply being more vexatious litigation. It recognised that the increase in litigants-in-person may lead to an increased burden of work upon a represented party, ranging from the practical production of bundles, to the degree of procedural assistance such a party ought to offer.   The Guidance suggests (amongst other key points):   You should take care to communicate clearly and to avoid any technical language or legal jargon, or to explain jargon where it cannot be avoided: a LiP who is already feeling at a disadvantage may be further intimidated and antagonised by the use of such language.   You should take extra care to avoid using inflammatory words or phrases that suggest or cause a dispute where there is none, or inflame a dispute, and avoid expressing any personal opinions on the LiP's behaviour…   If you speak to a LiP outside court it is generally wise to do so in the presence of a colleague, if possible. It would be wise in any event to make a note as soon as practicable of any material explanation or assistance which you have given to a LiP.   If you are negotiating a settlement it would be more appropriate to say ‘are you prepared to agree to…’ rather than to say ‘the courts in this situation would never agree to x, so I suggest that you agree to….’. The latter approach might be seen as unfair to the LiP, even if legally accurate.   Where a LiP is a defendant to proceedings and no other pre-action protocol applies, the Civil Procedure Rules (CPR) state that you should refer the LiP to the Pre-Action Conduct Practice Direction and draw their attention to paragraph 4 which concerns the court's power to impose sanctions for failure to comply with the Practice Direction. You can inform the LiP that ignoring the letter before claim may lead to the claimant starting proceedings, and may give rise to a liability for costs.   Where a specialist protocol applies and more detailed pre-action procedures are required, a LiP will ultimately be subject to the same obligations as a represented party. You should consider sending a copy of or a web-link to the relevant protocol to a LiP when first contacting them about a claim.   You should communicate in a manner of which the court would approve, which includes treating LiPs with courtesy and in a way that any ordinary person would regard as fair and reasonable. This does not mean that you have to tolerate unacceptable behaviour from a LiP, nor does it mean that a LiP has a right to expect you to respond immediately to their calls or correspondence.   It will be important to explain to your client why you are giving assistance to the opposing party, if this is not made clear in court by the judge. You should emphasise that you have a professional duty to the court and that in the interests of fairness the court may require you to provide procedural assistance to a LiP.