Special Damages only claims to continue under RTA Protocol

Special Damages only claims to continue under RTA Protocol

road traffic accidentSix years after the Pre Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents (“the protocol”) was introduced, it still remains a contentious battle ground between Claimants and Insurers. Jon Lord of Civil and Commercial Costs Lawyers Ltd discusses the implications of Phillips v Wills.

On 22 March 2016, Lord Justice Jackson delivered a judgment which heavily criticised a District Judge (and by association an appellate Circuit Judge) for making a case management decision that a claim continue under CPR Part 7 rather than follow the Stage 3 protocol procedure under CPR Part 8.

The facts

In the case of Phillips v Wills [2016] EWCA Civ 401, Mr Phillips brought a claim for damages for personal injuries and hire charges following a road traffic accident.  The claim was put forward under the protocol via the claims portal and the claim for general damages and physiotherapy were settled at Stage 2, leaving only hire charges of £3,486 in dispute.

The Claimant issued proceedings under CPR Part 8, thereby entering the third and final stage of the protocol and an oral hearing was listed.  On the basis that the only item remaining in dispute was the hire charge element (against which the Defendant had offered £2334), in making directions as to the evidence required at a relisted hearing, District Judge Howard sitting in the Gateshead County Court directed that the claim proceed under CPR Part 7 on the small claims track.

Appeal

No doubt aggrieved as to the costs consequences of the matter being allocated to the small claims track (ie virtually no costs being recoverable after allocation), the Claimant appealed to His Honour Judge Freedman, who upheld the District Judge’s case management decision.

The Court of Appeal did not agree. Jackson LJ pointed to the disproportionate cost of the decision that was made to proceed under Part 7, not least the additional Court fee of £335. He said “The district judge… caused the parties to incur substantial extra costs as a result of the order which he made of his own motion”.

He added, “In my view, the district judge's decision taken on 9 April 2014 that further evidence was necessary to resolve the outstanding dispute between the parties was irrational. The district judge was not entitled to reach that conclusion”.

Stage 3 to be followed

Jackson LJ pointed out that the RTA process was designed to whittle down disputes during the stages so the fact that the personal injury element had been resolved was not a reason for it to be handled outside the protocol and the District Judge therefore had no power to direct that the case should proceed under Part 7.

The parties did not escape criticism as Jackson LJ commented on the grounds of appeal presenting “a bewildering kaleidoscope of red, green and black”, an abundance of documentation and an overflowing bundle of authorities on one issue. Lord Justice Floyd and Lady Justice Macur agreed.

It is not evident what order for costs was made in relation to the appeal or how much was claimed but there can be little doubt that Jackson LJ will not have been impressed.

Jon Lord is a Senior Costs Lawyer at Civil and Commercial Costs Lawyers Ltd and a council member of the Association of Costs Lawyers.

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