I expect that Solicitors representing Claimants were disappointed when they heard that the appeal of Hoskin v Northampton General Hospital NHS Trust was being withdrawn. It had received permission to appeal from the Court of Appeal, which, as a second appeal, required the need to have both a real prospect of success and raise an important point of principle or practice.
For those who do not know, it concerns whether a medical agency fee note should include a breakdown of the medical expert’s fee
There is no binding authority on the point, and the case that is relied on (Stringer v Copley [2002]) was a County Court appeal. As a result, it leads to parties relying on first-instance/County Court decisions. It is acceptable as per Practice Direction (Citation of Authorities) [2001] paragraph 10 because, although an unreported case, it “contains a relevant statement of legal principle not found in reported authority“. Hence the phrase the ‘battle of the transcripts’. Each side is relying on decisions made by other County Court Judges regarding the issue.
I am usually instructed by Claimants to deal with the issue in fixed costs cases. The focus is not usually the principle of whether a breakdown should be given but whether in, fixed costs cases, there is any need to.
What did Stringer v Copley mean for the world of personal injury?
For those who do not know, Stringer was decided by the late Judge Cook (of ‘Cook on Costs’). It was an appeal of a detailed assessment and Judge Cook said “In any event, both parties wish me to make a decision on principle, and I am satisfied that there is no principle that precludes the fees of a medical agency being recoverable between the parties, provided it is demonstrated that their charges do not exceed the reasonable and proportionate costs of the work if it had been done by the solicitors .”
It is reasonable to question why a law firm would benefit from outsourcing to a medical agency and be able to recover more than it would have had it retained the task in-house.
Nevertheless, it had set in place the principle that the medical agency’s fee was recoverable. It also set the basis for a Defendant to seek a breakdown of the costs of a medical invoice fee.
So what did that mean for fixed cost cases?
Like with any type of litigation, it became a potential argument for Defendants to say that the cost of the medical agency fee was not recoverable. They relied on Aldred v Cham [2019] EWCA Civ 1780 because the Court of Appeal found that Counsel’s fee was not required for a ‘particular feature of the dispute’ and that if it was work that could be deemed to be undertaken by Solicitors, then it fell within the scope of their fixed fees.
Defendants claimed that the work the medical agency fee covered was a task that Solicitors could have performed. Therefore, it was not recoverable under CPR 45.29i(2)(h) as it was not a specific feature of the dispute. They argued that the fee could not be recovered.
However, Claimants began to argue that it was recoverable because CPR 45.29I(2) allowed for the recovery of the cost ‘of obtaining’ a medical report. Cases such as Beardmore v Lancashire County Council [2019] began to join the list of cases inserted into hearing bundles.
Appeal of Hoskin v Northampton General Hospital
Hoskin was an appeal of a detailed assessment and it was argued before Judge Bird who, upon considering PD47, determined that it “imposes a duty on the receiving party to provide the fee note of any expert instructed and, where such costs are claimed details of the costs of any MRO. Premex is not an expert. Its invoice cannot be described in any sensible way as a fee note and is in any event not the fee note of the expert“. Hoskin also referred to Stringer.
This led to applications by Defendants for Part 18 requests to be enforced with an unless Order. Some of these applications succeeded (and joined the ranks in the battle of the transcripts). The instructions I received always considered whether there was a place for Stringer and Hoskin in fixed recoverable costs cases.
Determination and not assessment
Those who instructed me always argued (and presumably in cases where I was not instructed) that Stringer and Hoskin had no place in the fixed recoverable costs regime. From a basic perspective, Judge Bird was considering the issue in respect of PD47 which (in his view) required the breakdown as part of detailed assessment.
Can that apply to fixed costs? It is most certainly not a detailed assessment. But can it be a summary assessment? CPR 44.6 doesn’t suggest it can be:-
(1) Where the court orders a party to pay costs to another party (other than fixed costs) it may either –
(a) make a summary assessment of the costs; or
(b) order detailed assessment of the costs by a costs officer,
unless any rule, practice direction or other enactment provides otherwise.
(Practice Direction 44 – General rules about costs sets out the factors which will affect the court’s decision under paragraph (1).)
(2) A party may recover the fixed costs specified in Part 45 in accordance with that Part
Whilst an obiter point, the Court of Appeal considered how fixed costs and disbursements are considered in Doyle v M&D Foundations & Building Services Limited [2022] EWCA Civ 927:-
In Adelekun Newey LJ noted at [19] that Part 45 does not itself explain how the amount recoverable in respect of disbursements under rule 45.29I is to be determined (the assumption being that no determination at all is necessary in relation to fixed costs other than disbursements), but recorded that it was common ground between counsel that the provisions in Part 47 relating to detailed assessment would apply. In my judgment the position agreed by counsel in that case was not correct, for the following reasons:
i) As referred to above, the provisions as to detailed assessment in rule 44.6 make it clear that such assessments do not apply to the fixed costs regime set out in Part 45.
ii) Those provisions were referred to by Master Leonard (sitting in the Senior Courts Costs Office) in striking out a Notice of Commencement of detailed assessment proceedings in Nema v Kirkland [2019] 8 WLUL 301 (see [53]). At [54] Master Leonard held that a party seeking determination of the number of disbursements should do so by an interim application under rule 45.29H, which provided for fixed costs of such application, rather than by the more expensive process of detailed assessment.
iii) In so holding, Master Leonard relied on the unreported decision of Master Howarth in Mughal v Samuel Higgs & EUI Limited (SCCO unreported, 6 October 2017), also striking out a Notice of Commencement of detailed assessment proceedings. Master Leonard summarised Master Howarth’s reasoning as follows:
“…the whole purpose of the fixed costs regime was to avoid the necessity of either summary or detailed assessment. It was not open to the claimant to draft a bill of costs and use the detailed assessment procedure, so increasing costs in proceedings where fixed costs were meant to apply… the appropriate course, in fixed costs cases, was for an application to be made to the court.”
iv) Mr Mallalieu pointed out (in written submissions following the conclusion of the oral hearing) that the parties in Nema did not draw Master Leonard’s attention to two provisions in Practice Direction 47: (i) paragraph 5.7, which provides that if the only dispute between the parties on detailed assessment concerns disbursements, the bill of costs shall be limited to the title page, background information, a list of disbursements and brief submissions as to those disbursements; and (ii) paragraph 13.5, which provides for such a dispute to be determined on the papers without a hearing. Whilst it is true that those provisions would limit the complexity and cost of disputes as to disbursements on a detailed assessment, those aspects being significant factors in Master Leonard’s decision, they do not undermine the sound foundation of both his and Master Howarth’s conclusion that Part 45 provides an entirely self-contained regime for fixed recoverable costs (including disbursements specified in rule 45.29I), separate and distinct in all respects from assessments under rule 44.6(1), whether summary or detailed.
v) It therefore appears that specialist judges sitting in the Senior Courts Costs Office do not consider that detailed assessment is a permitted method for determining costs (or disbursements) under the Part 45 regime (although the parties can no doubt use that route by agreement). Mr Mallalieu asserted that that was not the general practice, but produced no authority or example supporting his contention.
Paragraph 47
So if it is neither a summary nor a detailed assessment, can Stringer or Hoskin actually apply to fixed costs cases?
Distinguishing from Stringer
I have had success in arguing that Stringer (and by virtue, Hoskin) did not apply to fixed recoverable cost cases because:-
- Fixed costs cases did not need to rely on the principle of Stringer to recover the medical agency fee, because CPR 45.29i(2) expressly allowed its recovery
- Fixed costs cases are not subject to the indemnity principle (Butt v Nizami [2006] EWHC 159 (QB)) so the amount of work carried out by the Solicitors is not quantified, therefore there is nothing to compare the work carried out by the medical agency
- It was a determination rather than a summary/details assessment. It was never intended to be an intricate system of assessment.
Understandably, the judiciary would be concerned that the Claimant’s Solicitors were simply asking for their fee note to be accepted without challenge. That could never be the case because parts of CPR 44 did not expressly refer to summary or detailed assessment (and must applied to costs generally), including CPR 44.3(5):-
Costs incurred are proportionate if they bear a reasonable relationship to –
(a) the sums in issue in the proceedings;
(b) the value of any non-monetary relief in issue in the proceedings;
(c) the complexity of the litigation;
(d) any additional work generated by the conduct of the paying party,
(e) any wider factors involved in the proceedings, such as reputation or public importance; and
(f) any additional work undertaken or expense incurred due to the vulnerability of a party or any witness.
In my submissions, I always made it clear that the Court could consider reducing a fee note if it seemed disproportionate when considering all these factors. In some cases, fee notes were reduced, but it would usually be slightly (and Defendants were usually asking for nil, but not always). Essentially, my arguments were not about the principle of whether or not there should be transparency but whether the the fixed cost regime required or allowed it.
The fixed costs rules did not accommodate the determination of disbursements at various stages of the fixed costs regime in a different manner. It is simply a ‘one size fits all’. This ensured that a Claimant still had to demonstrate the fee note was proportionate and reasonable without getting into a costly endevour to obtain a breakdown.
Amini-Edu v Esure
Judge Saggerson was quite transparent throughout the hearings (because there were actually three hearings in total, two of which I appeared in) about his feelings regarding Premex not providing a breakdown.
However, my client’s position was that of the above, rather than the principle of Premex not being obligated to provide that information. It is quite possible that Judge Saggerson’s view on Premex’s position caused him to lose sight of the Claimant’s case. This could be seen at paragraphs 33 and 34. He relied on Stringer but did not seem to explain how it can be reconciled with fixed cost cases when it was not a detailed assessment and was not subject to the indeminity principle (preventing the need for the work the Solicitors carried out to be considered/assessed and compared with the work carried out by the medical agency). As per Doyle, fixed cost determinations were an entirely different kettle of fish.
Nevertheless, Judge Saggerson’s focus was on transparency, and he was of the view that without a breakdown there could be no way that the Court could adjudicate on proportionality. He was concerned that the Claimant’s approach would give medical agencies carte blanche. His decision now joins the battle of the transcripts.
Conclusion
I have dealt with instructions from both Defendants (where I am required to challenge the medical report fee as being disproportionate) and Claimants (where I am instructed to recover all or most of the fee).
It’s understandable that some legal issues may never reach a senior court to resolve the problem of “my list of judgments is bigger than yours” approach. No doubt Amini-Edu will be a huge problem for Claimants and Defendants would be silly not to rely on the Judgment (let’s be honest, if it were the other way round, Claimants would do the same).
I have had success in distinguishing Stringer and Hoskin from fixed costs cases (resulting in a more favourable determination of the medical expert fee), being able to argue that it is possible and proportionate to assess the value of a disbursement without a breakdown. I expect that will be far more difficult with Saggerson’s devastating attack on the position adopted by medical agencies. The District bench has been more amenable, possibly because they deal with fixed costs work more so than the Circuit bench.
Even if Claimants manage to overcome the breakdown hurdle, they still need to show that the overall disbursement was reasonable and proportionate. In some cases, even if a reduction is made, it could still be a better outcome for the Claimant than what the Defendant offers. Claimants should keep in mind that there are settlement offers that may be reasonable and they should consider accepting. Fixed cost determination hearings fall outside the scope of the fixed cost regime (Parsa v D S Smith [2019] Costs L.R. 331) and could be a costly endevour.
I should also say that this has been one of the most interesting hearings I have had the pleasure of being involved in. Judge Saggerson kept us on our toes and amused with his wit and humour. If there was ever a hearing that would look to encourage me to continue with an advocacy practice, that was it. He also turned in a draft Judgment within less than 24 hours, which is impressive.
Information
Alec Hancock is a CILEX Advocate and Litigator in Civil Proceedings. CILEX Regulation is his regulator. He can appear in open Court in all County Court matters save for family proceedings.
Alec Hancock conducts his advocacy through AJH Advocacy Limited. The Bar Standards Board is the regulator. Alec will attend any Court in England and Wales. He does not charge extra for:-
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