Counsel’s fees for an opinion on quantum in a traffic accident involving a child are included in the fixed costs for the case and cannot be claimed separately, the Court of Appeal has ruled.
Lord Justice Coulson said the fact the claimant was a child was not “a particular feature of the dispute” because it was a personal characteristic which had “nothing whatever to do with the dispute itself”.
The decision in in Aldred v Cham  EWCA Civ 1780 has alarmed claimant lawyers, throwing into doubt the viability of low-value road traffic accident claims where counsel’s opinion is required.
But the lawyer for the defendant said the ruling meant disbursement disputes were now unlikely to hold up fixed costs settlements.
The case centred on a single line in CPR 45.29I(2)(h), which allows additional claims for disbursements beyond the fixed fee to be claimed in cases where they are “reasonably incurred due to a particular feature of the dispute”.
Tyreese Cham, aged seven, was injured in a traffic accident in 2015. A claim was launched the following year under the personal injury pre-action protocol.
Philip Aldred, the defendant, initially denied liability, meaning the case dropped out of the portal and the costs rules in section IIIA of CPR part 45 applied. Following negotiations, he accepted liability in June 2016 and offered £2,000 to settle the case in August.
An opinion on the size of the offer was required under part 21 because the claim was made by or on behalf of a child. Paragraph 5.2 of Practice Direction 21 states that this must be obtained “except in very clear cases” – which this case was not.
Counsel recommended accepting the offer and charged £150 for the advice.
The court approved the settlement in February 2017, but Mr Aldred objected to paying an additional amount for counsel, arguing that it went beyond the fixed costs regime set out in section IIIA.
District Judge Hale ruled that the £150 was recoverable in addition to the fixed costs because the claimant was a child and this was a “particular feature” of the dispute. Mr Aldred appealed, but HHJ Owen QC, sitting at Nottingham County Court, upheld the decision.
Coulson LJ said the cost of counsel’s opinion on quantum did not arise from any particular feature of the dispute, but was an “almost mandatory” requirement in all RTA cases where the claimant was a child.
“The fact that, in a particular case, a claimant is a child, or someone who cannot speak English, or who requires an intermediary, is nothing whatever to do with the dispute itself.
“Age, linguistic ability and mental wellbeing are all characteristics of the claimant regardless of the dispute. They are not generated by or linked in any way to the dispute itself and cannot therefore be said to be a particular feature of that dispute.
“The particular features of the dispute in an RTA claim will commonly be matters such as: how the accident happened, whether the defendant was to blame for the accident, the nature, scope and extent of the injuries and their consequences, and other matters of that kind.
“For example, the particular circumstances of the accident may be sufficiently unusual to require an accident reconstruction expert, or the injuries may be so complex that they require a number of different experts’ reports.
“Such additional involvement of experts may also require specific advice from counsel. Depending always on the facts, such costs may be said to be a disbursement properly incurred as a result of a particular feature of the dispute.”
By contrast, Coulson LJ said, the cost of counsel’s advice was not necessitated by any particular feature of the dispute, but by the fact the claimant was a child. “It was therefore caused by a characteristic of the claimant himself and does not fall within the exception.”
He added that, even if he was wrong on this, the fee for the advice was not recoverable under rule 45.29I(2)(h).
“Taking section IIIA in the round, I consider that any fee for that advice must be deemed to be included within the fixed recoverable costs in Table 6B.”
Coulson LJ said his interpretation of CPR 45.29I(2)(h), was “consistent with the overall purpose of the fixed recoverable costs regime and in particular its aim of ensuring that, save for express exceptions, the amount recoverable is limited to the sums set out in the tables by way of fixed recoverable costs”.
He also agreed with the decision of HHJ Graham Wood QC in 2012, in which he similarly disallowed the services of a translator as an additional disbursement.
Lady Justice Nicola Davies and Lord Justice McCombe agreed, although they dissented on whether a “trawl” through various sections of part 45 of the CPR was helpful, arguing that it was.
Matthew Hoe, director of dispute resolution at Taylor Rose TTKW, which acted for Mr Aldred, said: “We felt we had to pursue this appeal because the principle that fixed costs covers the work of all lawyers wasn’t being accepted in the county court. This judgment ends all that.
“Disbursement disputes are unlikely to hold up fixed costs settlements now. This was a case about counsel’s fees for the appellant. The respondent raised the point about translation fees and we are grateful that the court has taken the opportunity to resolve that too.
“Clarity and predictability are the most valuable outcomes, whichever way these judgments go.
“We appreciate that the judgment may dismay claimants about the financial viability of some low-value personal injury claims. Stakeholder consultation led to the creation of section IIIA and, looking back, additional provision for children or language issues wasn’t sought.”
Jonathan Dingle, co-head of Normanton Chambers, tweeted that it meant the Court of Appeal “expects solicitors to advise even though they may (will) have an interest in costs arising from an early settlement”.
Liverpool firm Levins Law tweeted that the decision provided defendants with the “perverse incentive” to let modest claims drop out of the portal.
If an accident involved a child settled in the portal for £2,000, the claimant solicitors receive profit costs of £1,150, but that falls to £550 if the same claim drops out of the portal but settles pre-issue.
“PI [solicitors have been] banging the drum about this for ages. In confirming no separate fee for counsel in [the second] scenario, Aldred exacerbates the problem.”
Mr Hoe added: “It may be cold comfort for claimants now that future fixed costs regimes may ring fence counsel’s fees and provide for translation fees, whether done in-house or outsourced, following the government consultation earlier this year.”