With the expansion of the fixed recoverable cost regime to other areas, it’s worth bearing in mind where fixed costs do not apply, given that in personal injury it is the cause of action that determines whether or not the new fixed cost regime applies.
I am refraining from considering the draft fixed costs until the final draft comes out. It might be that some of those will eradicate circumstances which currently fixed costs do not apply but, in the meantime, this is post identifies the circumstances where currently fixed costs do not apply.
When do fixed costs start?
It is probably easier to identify when fixed costs begin, and the answer is from the moment the CNF (or in the case of holiday sickness cases, the Letter of Claim) is sent to the Defendant. This was confirmed in Sharp v Leeds City Council [2017] EWCA Civ 33. The Court had to consider whether an application for Pre-Action Disclosure was subject to fixed costs or standard costs.
The Court of Appeal determined that it was subject to fixed costs and was an interim application within the mean of CPF 45.29F because the commencement of the claim was commenced by the sending of the CNF and therefore the application was an interim application.
This was despite the fact that QOCS does not apply to pre-action applications as per CPR 44.13(1).
Third party disclosure Applications
Applications made under CPR 31.17 are not subject to fixed costs because the respondent is someone who is not a party to the proceedings. Further the starting point, as per CPR 46.1, like with Pre-Action Disclosure applications, the Respondent is entitled to its cost of the application and with complying with the Order in the first instance unless the applicant can demonstrate to rebut that presumption.
It can make a costly endevour for a Claimant who may require documentation that is within the control of someone other than the Defendant.
Applications after settlement.
There is a High Court case that confirms that post settlement applications are not subject to costs, Parsa v DS Smith PLC & Another [2019] Costs LR 331.
The Claimant had tried to argue that the that the failed application to seek costs on a standard basis because the Defendant accepted a Part 36 out of time was an interim application in accordance with CPR 45.29H meant that when the Claimant was ordered to pay the Defendant’s costs, they were capped at £300 due to CPR 45.29F (being that the Defendant could only recover what the Claimant was entitled to).
Carr J (as she was then) considered Sharp which considered that if a case started upon the submission of the CNF, that the claim ended when the parties agreed damages. As the application as issued after settlement, it was not an interim by any definition. Therefore the Defendant costs were to be assessed as standard costs, not determined as fixed costs.
There is an interesting case of Young v AXA Insurance UK Limited [2019] 4 WLUK 676 where, upon appeal, a Circuit Judge found that an application for Summary Judgment following a Part 36 offer was not subject to standard costs. He found there was no gap between the Part 36 acceptance and the entering into Judgment and the cost were included in the FRC as per the settlement.
Interestingly, the Judge was not referred to Parsa, which whilst did not have a neutral citation, was a QB decision of the High Court and biding on the Judge. If the delay led to an administrative application, then the cost should be assessed with that in mind. I would argue that Young was decided wrongly and the entire purpose was to encourage Defendants to make payments properly to avoid further costs being incurred after the main action had come to an end by way of a Part 36 settlement.
Appeals
It was always assumed that fixed costs could not possibly apply to appeals because the FRC regime did not account for it. Nevertheless, it was confirmed by the Court of Appeal in Wickes Buildings Supplies Limited v Blair (No. 2: Costs) [2020] EWCA Civ 17.
Now that cases issued after the 6th April 2023 will allow Defendant to enforce against both costs and damages an appeal, even where the outcome still produces a judgment in favour of the Claimant, will be more appetising.
Claimants will be able to recover reasonable costs and, importantly, counsel’s reasonable fees of drafting and appearing at the appeal.
Part 45.29J escape clause
There has always been an escape clause from fixed costs but it truly is a ‘break glass in case of emergency’.
Hislop v Perde [2018] EWCA Civ 1726 is the authority where the Court of Appeal was slow to give any sort of conclusion about the scope and extent of 45.29J because it did not matter to the instant appeal (considering whether standard costs applied to the consequences of accepting a Part 36 offer late) but made it clear that exceptional circumstance was far more than accepting a Part 36 out of time. It would be fact specific and would essentially be rare, given the purpose of the fixed costs regime was to ensure certainty and deal with perceived injustice in any given case with a. swings and roundabouts approach to solicitor remuneration.
Another case, Ferri v Gill [2019] EWHC 952 (QB), is where Steward J followed Hislop and Sharp, referring to litigation lawyers accepting the swing and roundabout approach was intended to compensate lawyers for more challenging cases with cases that remunerated the same for less complex cases.
Understandably there will be few circumstances that a Court will entertain an escape from the FRC regime under CPR 45.29J.
Exclusions as per the protocols
Each of the fixed cost protocols have exclusions.
In the RTA protocol, the exclusions:-
4.5 This Protocol does not apply to a claim—
(1) in respect of a breach of duty owed to a road user by a person who is not a road user;
(2) made to the MIB pursuant to the Untraced Drivers’ Agreement 2003 or any subsequent or supplementary Untraced Drivers’ Agreements;
(3) where the claimant or defendant acts as personal representative of a deceased person;
(4) where the defendant is a protected party;
(5) where the claimant is bankrupt; or
(6) where the defendant’s vehicle is registered outside the United Kingdom.
Understandably the scope is limited to non-RTA (i.e. if a pothole causes an accident the breach is of s41 Highways Act 1980, not as a road user).
There are similar exclusions in the EL/PL protocol, with its own unique exclusions:-
4.3 This Protocol does not apply to a claim—
(1) where the claimant or defendant acts as personal representative of a deceased person;
(2) where the claimant or defendant is a protected party as defined in rule 21.1(2);
(3) in the case of a public liability claim, where the defendant is an individual (‘individual’ does not include a defendant who is sued in their business capacity or in their capacity as an office holder);
(4) where the claimant is bankrupt;
(5) where the defendant is insolvent and there is no identifiable insurer;
(6) in the case of a disease claim, where there is more than one employer defendant;
(7) for personal injury arising from an accident or alleged breach of duty occurring outside England and Wales;
(8) for damages in relation to harm, abuse or neglect of or by children or vulnerable adults;
(9) which includes a claim for clinical negligence;
(10) for mesothelioma;
(11) for damages arising out of a road traffic accident (as defined in paragraph 1.1(16) of the Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents).
You may want to consider my post about how the interpretation of exclusions may be applied and how they could be costly if appropriately contested by the Defendant
Montreal and Athens convention claims
Both conventions give rises to the cause of action to bring a claim in England & Wales but such cases are not subject to fixed recoverable costs.
Claims arising form the Montreal Convention are not breach of duty or negligence but a statutory breach:-
Article 17—Death and Injury of Passengers—Damage to Baggage
1. The carrier is liable for damage sustained in case of death or bodily injury of a passenger upon condition only that the accident which caused the death or injury took place on board the aircraft or in the course of any of the operations of embarking or disembarking.
2. The carrier is liable for damage sustained in case of destruction or loss of, or of damage to, checked baggage upon condition only that the event which caused the destruction, loss or damage took place on board the aircraft or during any period within which the checked baggage was in the charge of the carrier. However, the carrier is not liable if and to the extent that the damage resulted from the inherent defect, quality or vice of the baggage. In the case of unchecked baggage, including personal items, the carrier is liable if the damage resulted from its fault or that of its servants or agents.
3. If the carrier admits the loss of the checked baggage, or if the checked baggage has not arrived at the expiration of twenty-one days after the date on which it ought to have arrived, the passenger is entitled to enforce against the carrier the rights which flow from the contract of carriage.
4. Unless otherwise specified, in this Convention the term “baggage” means both checked baggage and unchecked baggage.
https://www.legislation.gov.uk/uksi/2002/263/schedule/1/made
The Athens convention, like the Montreal Convention, takes precedent over any other cause of action and too would be exempt from the fixed cost regime (not withstanding it also would mean the moment that someone is embarking onto a ship, they are no longer in England & Wales).
I expect such claims will be captured by the extension of fixed costs but this will be interesting.
Where standard cost are contracted out by consent
It has always been open to the parties to decide how a settlement is dealt with in terms they both agree (Solomon v Cromwell Group Plc [2011] EWCA Civ 1584) subject of course to approval of the Court in the matters of children and protected parties.
The most recent case of Doyle v M&D Foundations & Building Services Ltd [2022] EWCA Civ 927 which is where the Court of Appeal found that a consent Order using the terms ‘detailed assessment’ for costs could not be anything other than standard costs. This was in contrast to Ho v Adelekun [2019] EWCA Civ 1988 which is where a poorly worded letter was closer to a Part 36 offer (although not a valid Part 36 offer) than a offer that opened up to costs being assessed on a standard basis.
Let’s be honest, I do not expect any Defendant to agree to consent in these terms from hereon in (save for where they can known with certainty that the standard costs of the Claimant will not exceed the applicable fixed costs).
Part 36 consequences
A party who has beaten their Part 36 offer will be entitled to have their costs assessed on an indemnity basis. It escapes the fixed costs, but only those costs, the costs up to the expiration of the relevant period will be on the fixed cost basis.
To save time, please read my post about calculating indemnity costs in fixed costs cases after a successful Part 36 offer.
It is known that the intention of the fixed costs expansion is to replace indemnity costs for Part 36 consequences with an uplift on fixed costs. This may not have the punitive effect that indemnity costs could, depending on the value of claim.
Allocation to the Multi-Track
Initially it was Qader & Ors v Esure Services Ltd & Ors [2016] EWCA Civ 1109 that determined a claim allocated to the multi-track automatically escaped fixed costs without the need to trigger CPR 45.29J as above.
The CPR Committee amended Part 45 to make it clear that fixed costs ends upon allocation to the multi-track as below:-
Application of fixed costs and disbursements – RTA Protocol
45.29B
Subject to rules 45.29F, 45.29G, 45.29H and 45.29J, and for as long as the case is not allocated to the multi-track, if, in a claim started under the RTA Protocol, the Claim Notification Form is submitted on or after 31st July 2013, the only costs allowed are—
(a) the fixed costs in rule 45.29C;
(b) disbursements in accordance with rule 45.29I.
The same is in the ELPL/Package Travel claims:-
Application of fixed costs and disbursements – EL/PL Protocol and Pre-Action Protocol for Resolution of Package Travel Claims
45.29D Subject to rules 45.29F, 45.29H and 45.29J, and for as long as the case is not allocated to the multi-track, in a claim started under the EL/PL Protocol or in a claim to which the Pre-Action Protocol for Resolution of Package Travel Claims applies,the only costs allowed are—
(a) fixed costs in rule 45.29E; and
(b) disbursements in accordance with rule 45.29I.
I recently appeared before a Circuit Judge in a fixed costs determination hearing where the claim was issued for £80,000, settled for £40,000 and was subject to fixed costs. Naturally the Judge was confused why in the first instance it was fixed costs. In some cases, life of the claim starts in the Portal before the true value is identified.
Are there other exemptions?
I think that is everything. Many of these will no doubt be removed by the new fixed costs regime. One has to remember with personal injury, it is the cause of action that leads to the new costs regime.
This means the current fixed costs regime will last for another three years minimum (given that save for statutory long stops, children’s limitation period does not start until their 18th birthday).
Information
AJH Advocacy Limited, a Limited Company which is regulated by the Bar Standards Boards (entity number 190758), ceases trading on the 12th January 2026.
From the 12th January 2026 and onwards, Alec Hancock will practice as a Barrister at Magdalen Chambers in Exeter. For instructions on matters on or after 12th January 2026, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.