While most current news concerning fixed costs seems to surround the delayed implementation of wide-ranging changes to the fixed costs rules, there has also been a couple of notable recent county court decisions in relation to costs recovery in fixed costs matters which practitioners should be aware of.

Relatively speaking, and as is probably not surprising, fixed costs matters do not generate a great deal of cost disputes. After all, the costs are fixed, aren’t they? Well, the disputes which do still crop up often fall in to two categories. Whether or not a disbursement is reasonable (in principle or in amount) and whether a case constitutes exceptional circumstances that warrant escaping fixed fees.

Wilkinson-Mulvanney v UK Insurance: Medical Agency fees

In Powles v Hemmings (A county Judgment in St Helens CC) the Court found that a medical agency’s work in obtaining the medical reports was profit costs and that any fee for this work had to be subsumed in the fixed fee for profit costs. Whilst there was some logic behind the decision it did cause alarm for Claimant solicitors who saw it as contradicting long established practice and procedure. Understandably, the decision encouraged Defendant insurers to not pay out on agency fees and many Defendants have sought to rely upon the case whenever raising this argument.

However, Regional Costs Judge Phillips in Cardiff County Court has found very differently in Wilkinson-Mulvanney v UK Insurance. He concluded that work carried out by medical agencies is properly recoverable as part of the disbursement fee, and in addition to the fixed profit costs.

He reasoned that when drafting the rules (CPR 45.12) the ‘costs of obtaining a medical report’ does include the cost of any medical agency fees incurred in the obtaining of such report. He went on to say that ‘had the drafters of the rules and the rule committee wanted to limit the fees recoverable to those only paid to the doctor, they could have quite easily made this clear in the rule.’

Whilst this remains a non-binding authority it is much more persuasive than Powles. The issue was looked at in much more depth, with reference to many more authorities and the decision was reached by a well-known and respected Regional Costs Judge.

Note, even if fees are recoverable in principle, they can still be reduced on the basis of reasonableness, as they actually were in Wilkinson-Mulvanney

Osuzuwa -v- Madeira: Exceptional Circumstances and Counsel’s Brief Fee

This matter was listed for trial. The Defendant obtained an adjournment of the trial because their partner had Covid and he was required to self-isolate. The case was listed for trial again. Shortly before the trial a Part 36 offer the Claimant had made earlier was accepted by the Defendant.
The Claimant argued that this matter was subject to exceptional circumstances and they should have been permitted to escape the fixed fee in accordance with CPR 45.29J. The Claimant also argued that Counsel’s brief should be recovered (whether by exceptional circumstances or as a disbursement in addition to the fixed fee).

The Judge held that he was bound by the decision in Hislop -v- Perde [2018] EWCA Civ 1726 (offers in FF matters which are accepted before trial but after the relevant period, limit the parties to fixed costs) so CPR 36.13 did not apply. However, the court still had a discretion to award different figures for costs under Part 45.29J. However, there had to be exceptional circumstances.

Part 45.29I gives a list of disbursements that are recoverable. It was noteworthy that counsel’s brief fees did not appear in the list.

The Court took the view that if the disbursement was intended to cover counsels’ brief fee it would have been included in that table. Had the trial begun the situation would have been different.
The judge said the only authority quoted in the White Book as providing guidance was Ferri v Gill [2019] EWHC 952 (QB) and that this reinforced that ‘exceptional circumstances’ are a high test or a high bar.

The judge held that an earlier adjournment and the Defendant’s very late acceptance of a Part 36 offer did not amount to exceptional circumstances so as to justify going outside the fixed costs regime. Both profit costs and Counsel’s fee had to be subsumed within the fixed fee.

To suggest that the circumstances which allow a party to escape fixed fees continue to be elusive would be a bit of an understatement.