Clarification needed—cost budgeting in actions brought by a minor

Clarification needed—cost budgeting in actions brought by a minor

money (2)Gordon Exall, barrister at Zenith Chambers, singles out a troubling issue arising from the new Civil Procedure (Amendment) Rules 2016, explaining that further clarification is needed with regards to cost budgeting and fatal accident claims.

What are the key features of the new rules?

The Civil Procedure (Amendment) Rules 2016, SI 2016/234 came into force on 6 April 2016 and applies to proceedings commenced on or after that date, although there are a number of exceptions.

As part of the new rules, there is one section in particular which applies to the issue of cost budgeting in relation to children—Rule 3.12(c) now excludes an action brought ‘by or on behalf of a person under the age of 18’ from cost budgeting. However, this raises additional questions, namely, with regards to its application in claims pertaining to the Fatal Accidents Act 1976 (FAA 1976). Such claims are usually brought by the executor or administrator on behalf of the dependants of the deceased. Dependants are more often than not both adult (the deceased’s spouse) and children (the deceased’s children).

How does this affect the exemption for children from costs budgeting?

Certainly all actions brought by children (via their lawyers) are exempt from cost budgeting. The wording of this new rule, however, creates some uncertainty with regards to claims that are said to be brought ‘on behalf of’ children. We need to consider what ‘on behalf of’ means.

In relation to fatal accident claims we can look to the wording of FAA 1976 for some assistance. FAA 1976, s 2(1) provides that the action ‘shall be brought by and in the name of the executor or administrator of the deceased’. This is then expanded in FAA 1976, s 2(4) where an obligation is imposed on the plaintiff to give ‘full particulars of the persons for whom and on whose behalf the action is brought’. Essentially, this means that each dependant does not have to be named as a claimant. Therefore, it is possible for the executors, administrators, or—in relevant circumstances—one of the dependants to bring an action on behalf of all of the dependants. However, this raises questions. For example, does this mean ‘solely on behalf of the child’ or does it only encompass cases where the child is the only claimant or dependant? This issue remains to be addressed.

Are there any issues with the new rules that lawyers should be aware of?

The main issue with the Civil Procedure (Amendment) Rules 2016, as noted above, is the potential problems it creates with regards to ‘hybrid’ claims, ie claims involving adult and child dependants. There will be no difficulty with the new rules when a child is the only dependant, as the claim is obviously being brought by or on behalf of a child. Nevertheless, fatal accident claims often involve a claim on behalf of adult claimants as well as children.

Lawyers should be aware that the issue requiring clarification is whether this exception only applies when an action is brought exclusively on behalf of a child. Currently, it is not straightforward what the position is when a child is one of the dependants, but the other dependants are not children.

What practical considerations should lawyers take in light of the new rules?

A cautious approach is advisable until we get total clarity on this issue. Until then, the parties involved should clearly state in the ‘Directions Questionnaires’ that this is a claim that includes a child dependant. Plus, the draft directions should specifically include an order stating that the claim is not subject to costs budgeting.

There is also additional information that parties can include in section I entitled ‘Other information’—this is the section where parties are asked to provide any and all information that would help the judge manage the claim. Here, I would suggest that the parties clearly state that the claim in question is being brought on behalf of a child dependant and that, therefore, cost budgeting should not apply.

Furthermore, for the sake of being prudent, parties should consider including a proviso to the effect of:

‘One of the dependants is a child. CPR 3.12(1)(c) excludes an action brought “on behalf” of a child from costs budgeting. To prevent unnecessary costs being incurred the court is asked to make a specific direction as to whether the parties are required to file costs budgets.’

While these measures should help mitigate the issue, until clarifications to the new rules are issued, lawyers and parties involved should tread carefully to avoid problems.

Interviewed by Giverny Tattersfield. The views expressed by our Legal Analysis interviewees are not necessarily those of the proprietor.

Subscription Form

Latest Articles:

Access this article and thousands of others like it free by subscribing to our blog.

Read full article

Already a subscriber? Login

About the author: