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Fixed costs versus consent orders: Bratek v Clark-Drain Ltd

Since their introduction in 2013, the pre-action protocols for low-value personal injury claims have been fertile ground for costs jurisprudence, particularly cases involving receiving parties’ attempts to circumvent the fixed costs regime in CPR 45.

Avenues for escape have been closed in recent years, with last years’ decision in Sharp v Leeds City Council being a prime example. In that case, in which the Court of Appeal confirmed the application of fixed costs to pre-action disclosure applications, the principle was robustly stated that all cases entering either the Road Traffic Accident (RTA) or Employers’ Liability / Public Liability (EL/PL) portals were intended to be subject to fixed costs unless allocated to the multi-track or in cases involving exceptional circumstances.

Yet despite this clear statement, the application of fixed costs has recently been the subject of a new challenge. Bratek v Clark-Drain Ltd concerned an appeal regarding the application of the cost provisions of a consent order following the claimant’s successful personal injury claim. It was accepted between the parties that the matter fell within the EL/PL Protocol for Low Value Personal Injury Claims, and that the claim came out of the pre-action protocol due to the defendant’s denial of liability.

The parties reached a compromise the day before the claim was to be heard at a fast track trial, with the defendant agreeing to pay the claimant £10,000. A consent order was agreed, which included provision for the defendant to pay the claimant’s costs on a standard basis, to be assessed if not agreed. The claimant argued that this took the case out of the clutches of the fixed costs provisions in CPR 45.29. Unsurprisingly, the defendant disagreed, with a potential liability of £24,000 on the standard basis as against £10,000 fixed costs.

HHJ Yelton found no help for the claimant’s position in the rules, the matter having not been allocated to the multi-track and there being no basis for a finding of exceptional circumstances as per CPR 45.29J. He was then referred to a series of authorities, amongst them the Sharp case. HHJ Yelton placed considerable weight on the expression of principle from that case, namely that it was the intention of the fixed costs regime to limit all cases entering the portal, but subsequently leaving it to those fixed costs (except where CPR 45.29J could be said to apply).

Aside from that principle, the decision in Sharp was found not to be applicable to the circumstances of this case. HHJ Yelton was therefore not persuaded by the claimant’s position and found that provisions of CPR 45.29 were mandatory and not capable of being avoided by the wording of a consent order.

The decision in Bratek follows the firm intention of the Court of Appeal to limit any possibility of escape from the fixed costs regime and firmly answers any lingering question about whether it is possible to agree to an alternative provision for assessed costs. Doubtless further creative challenges to the fixed costs regime will arise, but it seems that, for now, any party attempting to run such an argument will face an uphill struggle.

Association of Costs Lawyers David Wright

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