Pre Judgment Interest On Costs Under CPR 44.2(6)(g) | A General Rule?

Nosworthy v Royal Bournemouth & Christchurch Hospitals NHS Foundation Trust

Master Brown (costs judge) declined to award pre judgment interest on the cost of a loan which the Claimant had taken out to fund the expense of an expert medical report in this clinical negligence case.

The Master rejected the notion that the Court in Jeffrey Jones and others v Secretary of State for Energy and Climate Change and others [2014] EWCA Civ 363 had intended to set a general rule that an award of interest on costs should be made in respect of the period before judgment and respectfully agreed with Dingemans J in Schumann and Anor v Veale Wasbrough [2013] EWHC 4070 QB that not only was such an award not the general rule in ordinary litigation but that it was undesirable that there should be such a general rule.

“the making of an order of the sort which is requested by the Claimant would introduce an unnecessary level of sophistication into the process for assessing costs… The complications which would arise would, to my mind, be substantial even in a modest case; and they would exist even assuming that the rates and the principle of payment were agreed. Further, paying parties might legitimately question whether they should be paying any interest if the receiving party had, for instance, the means, by way of insurance or otherwise, to pay up front for disbursements without taking out a loan. The potential for yet further legitimate disagreement would be substantial in the context of ordinary litigation (which may involve litigants in person).”

He continued…

“costs recovery is not intended to be a complete indemnity. Under the pre-LASPO costs regime the element of the success fees which was attributable to the delay in payment of fees was not recoverable inter partes: see rule 44.3B of the then applicable Civil Procedure Rules. Indeed, it seems to me that it might reasonably be thought that if Parliament had now intended there to be a recovery of the costs of funding or borrowing in litigation of this sort in the manner in which it is now claimed it would have provided an appropriate mechanism for its ascertainment.”

NOSWORTHY V ROYAL BOURNEMOUTH & CHRISTCHURCH HOSPITALS NHS FOUNDATION TRUST [2020] EWHC B19 (COSTS)