Issue – In low value ex-protocol RTA, employer’s liability and public liability claims, does an agreement for costs to be ‘subject to detailed assessment if not agreed’ amount to an agreement between the parties to dis-apply Fixed Recoverable Costs (FRC)?
Claimant argument – In this case the Claimant submitted that FRC did not apply, not in view of any of the exceptions in CPR 45IIIA applied but because in responding to the Defendant’s Part 36 offer, the Claimant had responded stating that it could not be accepted as a result of the Part 36 offer being made less than 21 days before the trial date. As result CRR 36.13(4) applied, a deemed costs order would not result from mere acceptance and an order was required for an entitlement to costs.
An agreement was reached that ‘The Defendant do pay the Claimant’s costs such costs to be subject of detailed assessment if not agreed’.
Defendant Argument – As an ex-portal claim, fixed costs should apply.
Decisions – District Judge Rogers in Doncaster assessed the bill of costs at £14,467 plus interest, discarding the Defendant’s submission that, as an ex-portal claim, FRC should apply. This was upheld by Her Honour Judge Ingram in Sheffield.
Court of Appeal Decision – Phillips LJ said:
“In my judgment, and contrary to the appellant’s contention, there is no ambiguity whatsoever as to the natural and ordinary meaning of ‘subject to detailed assessment’ in an agreement or order as to costs. The phrase is a technical term, the meaning and effect of which is expressly and extensively set out in the rules. It plainly denotes that the costs are to be assessed by the procedure in part 47 on the standard basis (unless the agreement or order goes on to provide for the assessment to be on the indemnity basis).”
Commentary – This decision highlights the importance of parties taking particular attention when reaching an agreement as to costs in cases to which the fixed-costs regime wold normally apply.