Under CPR 45.29, fixed costs are dependent on the amount of damages recovered and the stage of the litigation reached at settlement. So, is that it? Do you just settle for those fixed costs?
At CPR 45.29J it states “If it considers that there are exceptional circumstances the Court will consider a claim for an amount of costs (excluding any disbursements) which is greater than the fixed recoverable costs (“FRC”) referred to in rules 45.29B to 45.29H.” So, what constitutes “exceptional circumstances?”
In Carlon v Dominos Pizza Group Limited (Unreported: District Judge Wyatt, Birmingham County Court 27/08/10) the Claimant was struck on a zebra crossing. Initially the Motor Insurers’ Bureau were pursued. The RTA proceeded with medical assessment. However, 9 months after the accident, the Claimant developed anorexia nervosa which led to her hospitalisation for several months. The possibility the condition may be a consequence of the accident was raised. The District Judge concluded this was not simply an unusual turn of events, but “the element of the possibility that there was a connection between her eating disorder or its exacerbation and this accident is, and amounts to in itself, exceptional circumstances.”
Udogaranya v Nwagw  EWHC 90186 (Costs) was an RTA matter which settled pre-issue. The Court found it was not a run-of-the-mill case and the “Defendant was giving the Claimant the run-around”. The Defendant found to have cast their net widely as to liability, and essentially inferred this was not a proper claim. As a consequence, the Claimant was put to more work than would otherwise be the case in this type of claim. The Judge was persuaded exceptional circumstances existed.
In Yorke v Adams (Unreported, Sheffield County Court 27/03/08) the Claimant was a sufferer of multiple sclerosis and injuries mainly related to exacerbation/acceleration of symptoms. Medical evidence was gathered including neurological and care elements which took the costs outside the realms of the fixed costs regime on the basis of being exceptional.
Ford v Lincolnshire Road Car Company Limited (Unreported: District Judge Cooper, Lincoln County Court 26/09/11). This was another RTA matter and included within the claim was an allegation that the accident had caused acceleration of dementia. Ultimately this aspect was not pursued however the Judge determined those issues had to be explored, even though expert reports weren’t obtained, and that this amounted to exceptional circumstances.
Conversely, Fretter v Ewing (Unreported: District Judge Kirby, Bury St Edmunds County Court 09/12/10) involved an elderly Claiman knocked over by the Defendant as she crossed the road. The Defendant denied liability. Shortly before issue of proceedings the Claimant made a Part 36 offer that the Defendant accepted. Despite being put to an extensive amount of work, the dispute on liability was found not to have constituted exceptional circumstances.
The case of Briscoe v Tilt (Unreported: Master O’Hare SCCO 09/02/12) involved the Claimant arguing exceptional circumstances following a denial of causation on grounds it was a low velocity impact. The Judge found that this did not amount to exceptional circumstances. Unusualness by itself was not enough.
Sargeant v Fellows (Unreported: District Judge Lamb, Dudley County Court 12/10/12). Another RTA claim where the Claimant had a chromosomal disorder requiring 24-hour care. Injuries from the index accident were minor. It was argued there were exceptional circumstances as the Claimant had a litigation friend and additional work was required. It was accepted by the Court that those circumstances made the case more complex, but not exceptional.
These various decisions all come from the lower Courts so may be of limited assistance. The common theme however is that unusual does not mean exceptional, and that each case is reviewed on its own merits.
It is also important to remember that even if the Court is persuaded that exceptional circumstances exist, the receiving party will still need to recover more than 20% of the level of FRC. If this margin is not exceeded, the Claimant will be awarded the lower of the FRC or assessed costs. This could also result in the Claimant having to bear the costs of the assessment process. It is therefore essential to carefully analyse the position before embarking on a move to plead exceptional circumstances.
By Claire Corrie – Costs Lawyer