Page 6 - Inside Law Magazine Issue 11 - Summer 2015
P. 6

JUTo Be A n I m p o r t a n t
                                                                   Where 36.14 (1)(b) applies, the Court will, unless it considers
The making of an appropriate Part 36 offer within costs            unjust to do so, order the Claimant is entitled to:
        proceedings is fairly new in procedure, however is of
        great importance for both receiving and paying parties,    (a) Interest at a rate not exceeding 10% above base rate for some
particularly to ensure costs protection moving forwards to         or all of the period starting with the date on which the relevant
any assessment hearing. Pitched right, the new CPR 36.17           period expired
(4) (d) (prior to 6th April 2015 – CPR 36.14) can result in a
further 10% recovery on the costs assessed. This change in         (b) Costs on the indemnity basis from the date on which the
the rule has invited the Claimant to make reasonable offers        relevant period expired
for acceptance and penalises the Defendant for not accepting
the same.                                                          (c) Interest on those costs at a rate not exceeding 10% above
                                                                   base rate and;
The issue was recently reviewed in the High Court on the case of
Cashman v Mid-Essex Hospital Services NHS trust (2015) EWHC        (d) An additional amount, which shall not exceed £75,000.00,
1312 (QB). In this case the Claimant receiving party appealed an   calculated by applying the prescribed percentage below to an
Order of Senior Costs Judge Master Gordon-Saker refusing to        amount which is-
award an additional amount under CPR 36.14 (3)(d) on a Detailed
Assessment of costs in October 2014.                               Amount Awarded   Prescribed
                                                                      by the Court  Percentage
The action itself was a Clinical negligence case settling for the
multi-track sum of £90,000.00. The receiving party thereafter      Up to £500,000	  10% of the amount awarded
commenced detailed assessment proceedings and served a Bill of
Costs totalling £262,000.00. Points of Dispute were served by the  Above £500,000	  10% of the first £500,000 and
Defendant and approximately 5 weeks after receipt the receiving                     (subject to the limit of £75,000)
party made a Part 36 offer in the sum of £152,500.00 to conclude.                   5% of any amount above that
                                                                                    figure.
At detailed assessment, some 7 months post Part 36 offer, Senior
Costs Judge Master Gordon-Saker ordered the paying party to        Under CPR Part 36.14 the Master confirmed in Cashman it would
pay £173,693.78 in costs, thus more advantageous than the          not be unjust to order:
receiving party’s own Part 36 offer, triggering 36.14(3)(d) as it
was clear the judgment was more advantageous to the Claimant       i) Under CPR 36.14 (3) (a), interest on the Bill at 10.5%
than their own offer.
                                                                   ii) Under CPR 36.14 (3) (b), costs of the Detailed Assessment
Under CPR 36.14 (1)(b) – costs consequences apply where            on the indemnity basis
judgment against the Defendant is at least as advantageous to
the Claimant as the proposals contained in a Claimant’s Part 36    iii) Under CPR 36.14 (3) (c), interest on the costs of assessment
offer. For the purpose of paragraph 1, “more advantageous” means   at 10.5%
better in money terms by any amount, however small.
                                                                   What remained to be decided was as to whether the receiving
                                                                   party would be entitled to recover the additional 10% on the
                                                                   amount assessed.

                                                                   Master Gordon-Saker held it would be unjust to require the
                                                                   Defendant to pay an additional 10%, approx. £17,000.00, which
                                                                   of course is a substantial sum of money for any Solicitor firm to
                                                                   bank on the basis of successfully beating their own attempt at
                                                                   early conclusion.

6 Inside Law Issue 11 | SUMMER 2015
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