18 St John Street Costs Law specialist James Miller analyses another recent appeal success. Instructed by Mr Ben Millns of Keoghs, Mr Miller acted on behalf of the Respondent in an interesting costs appeal which concerned the proper interpretation of “detailed assessment” in a fixed costs case.
Following correspondence between the parties culminating in a consent order, the Respondent was ordered to pay the Appellant’s damages in the sum of £19,000 plus costs “subject to detailed assessment if not agreed”. The appeal concerned the proper interpretation of that provision having regard to the parties’ intentions at the time settlement was reached.
Upon settlement of damages, the Appellant failed to serve a Bill of Costs for Detailed Assessment within 3 months pursuant to the consent order and CPR 47.7. Thereafter, the Respondent made a successful ex parte application, which resulted in the court ordering the Appellant to commence detailed assessment within 28 days, failing which the costs would be assessed at £nil. The Respondent was awarded its costs of the successful application. As the order granting the application was made without a hearing, the Appellant applied to set it aside.
The Appellant argued that the ordering of detailed assessment was incompatible with the terms of the concluded contract between the parties entered into through correspondence. In essence, it was said that this was a fixed costs case to which CPR 45.29B applied and detailed assessment was not permissible. Earlier correspondence had referred to “fixed costs” and it was clear notwithstanding the consent order that the parties intended such costs to apply from the outset (Ho v Adelekun  EWCA Civ 1988).
The Appellant’s application to set aside the order compelling them to commence detailed assessment was initially dismissed by a Deputy District Judge. The Judge distinguished Ho, which concerned settlement via Part 36 and she had regard to the fact that costs had recently been agreed and paid.
The Appellant was granted permission to appeal the decision because it was at least arguable that the Deputy erred in law by not setting aside the earlier ex parte order. This was on the basis that detailed assessment proceedings were inappropriate in a fixed costs case having regard to Ho and Doyle v M & D Foundations & Building Services Limited  EWCA Civ 927.
On appeal, although the Deputy’s decision was described as “opaque” in relation to the application of Ho, the court would not interfere. His Honour Judge Carter determined that in accordance with Doyle, the terms of the consent order, agreed to by solicitors for the parties, were clear. The court would apply an objective test and be very slow to reject the natural meaning of “detailed assessment” within the order, even if it appeared to be detrimental to the Respondent (Arnold v Britton  UKSC 36). Detailed assessment was the consensus, so the Respondent was entitled to compel the Appellant to start the process by application.
The court concluded that the steps taken since the consent order were irrelevant and extrinsic evidence offering further explanation should not be allowed. It did not matter that costs were subsequently agreed for a figure commensurate to fixed costs as the starting point was the consent order. Accordingly, the Deputy’s decision not to set aside the order was correct and the appeal was refused.
The appeal highlights again the importance of litigants paying particular attention to provisions when agreeing orders for costs in fixed costs cases.
For further information on James Miller and the Personal Injury, Clinical Negligence & Costs Department please contact Chambers Director James Parks or Senior Clerk Katie Brown.