In Aldred v Cham  EWCA Civ 1780 the Court of Appeal (Lord Justices McCombe and Coulson and Lady Justice Nicola Davies) considered whether the cost of counsel’s advice relating to the proposed settlement of an RTA claim was a claim for a disbursement which should be allowed in addition to the fixed recoverable costs (“FRC”) provided for under CPR 45.29C and Table 6B because it was “reasonably incurred due to a particular feature of the dispute”. This case has provided welcome clarity in a previously much disputed area.
Roger Mallalieu appeared for the successful Appellant. Pippa Manby explains the facts, the court’s rulings and the implications of the decision.
The Respondent was aged seven at the date of the RTA involving the Appellant. The claim was commenced via the RTA Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents (“the PAP”) but exited the PAP when liability was denied. Liability was eventually accepted and an offer of £2,000 in full and final settlement made. Counsel’s advice was sought on the offer as required by CPR 21.10(1), which provides that: “Where a claim is made –
(a) by or on behalf of a child or protected party; or
(b) against a child or protected party,
no settlement, compromise or payment (including any voluntary interim payment) and no acceptance of money paid into court shall be valid, so far as it relates to the claim by, on behalf of or against the child or protected party, without the approval of the court.”
Further, Practice Direction 21, at paragraph 5.2, provides that: “(1) An opinion on the merits of the settlement or compromise given by counsel or solicitor acting for the child or protected party must, except in very clear cases, be obtained”.
Counsel’s written advice recommended acceptance of the offer. Thereafter the offer was accepted and CPR Part 8 proceedings were issued to obtain the Court’s approval. The Respondent then made a claim for costs in accordance with CPR 45 IIIA (Claims which no longer continue under the PAP) which included a claim for counsel’s advice as a disbursement.
CPR 45.29I sets out the relevant rules in relation to recovery of disbursements in Section IIIA claims as follows:
“(1) Subject to paragraphs (2A) to (2E), the court—
(a) may allow a claim for a disbursement of a type mentioned in paragraphs (2) or (3); but
(b) will not allow a claim for any other type of disbursement.
(2) In a claim started under the RTA Protocol, the EL/PL Protocol or the Pre-Action Protocol for Resolution of Package Travel Claims, the disbursements referred to in paragraph (1) are—
(a) the cost of obtaining medical records and expert medical reports as provided for in the relevant Protocol;
(b) the cost of any non-medical expert reports as provided for in the relevant Protocol;
(c) the cost of any advice from a specialist solicitor or counsel as provided for in the relevant Protocol;
(d) court fees;
(e) any expert’s fee for attending the trial where the court has given permission for the expert to attend;
(f) expenses which a party or witness has reasonably incurred in travelling to and from a hearing or in staying away from home for the purposes of attending a hearing;
(g) a sum not exceeding the amount specified in Practice Direction 45 for any loss of earnings or loss of leave by a party or witness due to attending a hearing or to staying away from home for the purpose of attending a hearing; and
(h) any other disbursement reasonably incurred due to a particular feature of the dispute.” (Emphasis supplied)”
The Decisions at County Court Level
District Judge Hale allowed the £150 claim for counsel’s advice both on provisional assessment and at a renewed oral hearing on the basis that such an advice was required by CPR 21 and that it was a disbursement “reasonably incurred due to a particular feature of the dispute” pursuant to CPR 45.29A(2)(h). On appeal, HHJ Owen QC sitting at Nottingham County Court upheld DJ Hale’s decision.
Decision of the Court of Appeal
Coulson LJ set out the relevant sections of CPR 45 Sections II, III and IIIA.
He then considered whether counsel’s advice was “a particular feature of the dispute” such that it could be recovered pursuant to CPR 45.29A(2)(h). He noted that there were no reported decisions on the interpretation of this provision before considering the decisions of HHJ Graham Wood QC (sitting in the Liverpool County Court) in Olesiej v Maple Industries and Master Campbell in Madej v Macizyn  Lexis Citation 143 both of which considered whether the fee of a translator, in a case where the claimant was not an English speaker, could be said to be a fee due as a result of “a particular feature of the dispute” so as to be recoverable under CPR 45.12(2)(c) (which is part of section II of CPR 45).
He noted that in Olesiej HHJ Wood QC had refused to allow the disbursement, holding that it arose out of a particular feature of the claimant but not of the dispute whereas Master Campbell had reached the opposite view in Madej, holding that a claimant’s personal characteristic (in that case, the claimant’s lack of English) was feature to which sub-paragraph (2)(h) could relate.
Coulson LJ preferred the approach of HHJ Wood QC holding that the fact that the Respondent was child was not a particular feature of the RTA dispute between the Respondent and Appellant. The fee for counsel’s advice, therefore, could not be recoverable under CPR 45.29I(2)(h). He held that such an approach was consistent with the overall purpose of the FRC regime which is to “ensur[e] that, save for express exceptions, the amount recoverable is limited to the sums set out in the tables by way of fixed recoverable costs” (paragraph 39).
Although strictly obiter with regards to non-child RTA cases, Coulson LJ held that the fact that, in a particular case a claimant was a child or someone who could not speak English or who required an intermediary was “nothing whatever to do with the dispute itself. Age, linguistic ability and mental wellbeing are all characteristics of the claimant regardless of the dispute. They are not generated by or linked in any way to the dispute itself and cannot therefore be said to be a particular feature of that dispute”. Further, he gave guidance that “[t]he particular features of the dispute in an RTA claim will commonly be matters such as: how the accident happened, whether the defendant was to blame for the accident, the nature, scope and extent of the injuries and their consequences, and other matters of that kind. For example, the particular circumstances of the accident may be sufficiently unusual to require an accident reconstruction expert, or the injuries may be so complex that they require a number of different experts’ reports. Such additional involvement of experts may also require specific advice from counsel. Depending always on the facts, such costs may be said to be a disbursement properly incurred as a result of a particular feature of the dispute.” (paragraphs 35-36).
That decision was sufficient to determine the appeal in the Appellant’s favour. However, Coulson LJ went on to consider whether, if the advice had been held to be due to a particular feature of the dispute, the cost thereof could constitute a disbursement reasonably incurred which the court should allow in addition to the FRC under Table 6B. He noted that counsel’s fee for advising on settlement was a disbursement within the meaning of section 67 of the Solicitors Act 1974 and within CPR 45.29I. Such a disbursement could not be recovered as such if the item of work to which it related was within the FRC set out in Table 6B. Thus the vast majority of counsel’s fees could only be recovered to the extent that a claimant could show that it fell within the exceptions in CPR 45.29I(2). In this case, the fee for the advice was a routine step that has to be taken in all RTA claims where the claimant is a child. It thus fell within Table 6B and could not be recovered separately as a disbursement.
Whilst Coulson LJ held that exercises in comparing and contrasting across Sections II, III and IIIA of CPR 45 were “generally unhelpful and should be avoided” (paragraph 16) and enjoined parties disputing fixed costs under a particular section of CPR 45 to focus on that particular section only, LJ McCombe (with whom Nicola Davies LJ agreed) held that “it is impossible to approach the matter in discrete compartments. It is necessary to construe such instrument as a whole. I do not think that comparisons between the wording of the various sections of Part 45 of the Rules will always be avoidable. Nor do I think that such comparisons are unhelpful. It is necessary that the CPR, and even more so, particular Parts of them are approached and interpreted as a coherent whole. The fixed costs rules should not be allowed to hold within their various Sections different meanings for essentially similar words” (paragraph 72).
Accordingly, following this decision:
- The fees for counsel advising on settlement in child claims under the RTA Portal are not recoverable as a disbursement pursuant to CPR 45.29(I)(2)(h). This should resolve a number of disputes that have been awaiting the outcome of this appeal.
- Although the Court of Appeal’s comments were obiter, it is clear that claims for disbursements relating to particular characteristics of the claimant such as their ability to speak English and/or mental wellbeing will not qualify as arising from “a particular feature of the dispute” and so will also not be recoverable as disbursements pursuant to CPR 45.29(I)(2)(h). These other disputes should also now be capable of swift resolution.
- The Court of Appeal has reiterated that the FRC regime is designed to limit recovery of costs to those figures specifically provided for in the rules. As is well-established, this will under-reward in some instances but over-reward in others: Lamont v Burton  EWCA Civ 429.
- Following the majority’s view, parties are entitled to scour the entirety of the CPR for material to support their interpretation of any particular provision. Despite Coulson LJ’s protestations, district judges hearing disputes concerning FRC may still find themselves being taken through large parts of CPR 45 to support arguments in respect of small sums of money.
© Pippa Manby. The author assumes no responsibility to any party in respect of this article. Specific legal advice tailored to specific problems should always be obtained.