Kenton v Slee Blackwell PLC [2023] EWHC 2613 (SCCO)

The Consequences Of An Inadequate Costs Estimate And A Flawed Risk Assessment | Solicitors Act Assessment

“In circumstances where the client was given a hopelessly inaccurate estimate, relied on the estimate by entering into a conditional fee agreement, lost the opportunity of doing something different, was not given proper costs information, was billed a sum several times the amount of the estimate, and where the solicitor failed properly to explain the difference between the estimate and the costs incurred, the amount that the client should reasonably be expected to pay must be a figure close to the estimate upon which she relied. The claim settled before issue and following mediation. The estimate given for that outcome was £5,000 to £20,000 plus “additional costs for mediation”. Taking the top end of that bracket and adding £20,000 for mediation would give £40,000. That is just under half of the figure which Ms Slade referred to as the most she had ever charged for a case which went to trial. It is also not far off the amount that I would expect to have seen estimated and incurred. £40,000 seems to me to be the reasonable sum which the Claimant should be expected to pay.”

Probate

Failure To Mediate And Validity Of Part 36 Offers In Probate Claims

I have concluded that the claimant’s conduct was not such as to warrant a deduction from his costs. In reaching that conclusion I have in mind in particular (a) the fact that the claimant made most of the running in relation to settlement (b) the third defendant’s behaviour in her conduct of the claim and (c) the strong merits of the claim which either were known or should have been known to the third defendant and (d) the late stage at which the third defendant expressed a willingness to engage in ADR. Although the claimant did not explain his position in April and May 2023 it would not have been unreasonable to have concluded that the additional cost of mediation was not warranted. I do not consider that on the facts of this case it can be said that silence on the part of the claimant amounted to a refusal to undertake mediation (or some other form of ADR).

Interest after late acceptance

Interest Following Late Acceptance Of A Claimant’s Part 36 Offer

“It seems clear to me that such an informed and reasonable observer would understand the offer term to mean that after 21 days interest would accrue on the entire offer sum. The way to understand it is to imagine a black box. The amount the claimant offered to compromise the claim and that the defendant accepted to pay is in that black box. By accepting the claimant’s offer, the defendant agrees to give the black box to the claimant. But there is a delay in giving the claimant the box. If the claimant had been given the box with the full sum on the Day 21, he could have invested it and received interest. But he did not get it. Instead, the defendant kept the money for that extra period. In that delay period, two things happened. The defendant benefited from the monies and the claimant was deprived of them. It seems to me obvious that the claimant should receive interest for the net sum for the delay period (or periods, strictly).

YIELDPOINT STABLE VALUE FUND, LP V KIMURA COMMODITY TRADE FINANCE FUND LIMITED

Part 36 Offer Was Not A Genuine Offer To Settle

“This was not a case where a very high claimant offer reflected a very strong prospect of the claimant succeeding at trial. The parties were diametrically and evangelically opposed in terms of their characterisation – and, I sensed, subjective understanding – of the deal they had concluded. A discount of 1% is meaningless in such context. It amounts to saying ‘pay up now, accept that you are wrong’.”

CHAPPELL V MROZEK

CPR 44.14(1) | QOCS Following Late Acceptance Of A Part 36 Offer

“Even if I did not consider myself bound by Cartwright and Adelekun, I do not consider the application of those decisions to be unfair and totally arbitrary in the particular way characterised by the defendant. It was well understood when QOCS rules were introduced, that they reflected a global policy intention which would reduce adverse costs paid by defendants in injury litigation overall on a swings and roundabouts basis; they marked a radical departure from the previous position on costs recovery. The language in both CPR Part 36 and Part 44 clearly demarcates between the position where the court’s permission is required for a particular type of costs order to be made following judicial scrutiny, and those where it is not. This is consistent with the overriding objective to allow matters to be resolved expeditiously, save expense and manage court resource effectively, so that parties are not forced through time-consuming and expensive court processes unless absolutely necessary ….

” … The offer … was not totally worthless in terms of both costs protection and an incentive to the claimant to settle. It stopped recovery by the claimant of their costs from expiry of the relevant period 21 days after the offer had been made. Acceptance of the offer also saved the defendant from paying the significant costs of completing expert evidence, trial preparation and trial.”

MATHIEU V HINDS & ANOR (NO. 2: COSTS)

Partial Success, Conduct, Offers And Alleged Exaggeration

“…even if the more flexible approach contended for by the Claimant is applied, I do not consider it realistic to argue that the Claimant did better at trial than the offer. By going to trial he recovered £371,258.36 less in damages than the offer. Although by going to trial he also secured the peace of mind of the provisional damages for epilepsy, I accept the Second Defendant’s arguments that the additional £371,258.36 in the offer accommodated that claim. It follows that the Claimant did not beat the offer of £3,550,000 or the Second Defendant’s last offer £4,000,000.”

Calderbank Offers Not To Be Equated To Part 36 In Split Trial Cases

It is well-established that the existence of a Part 36 Offer in the case of a split hearing displaces the normal presumption that costs will be awarded at the end of the first stage. Instead, in such cases, the normal position is that, save in exceptional circumstances, costs would be reserved.

But what is the position where a Calderbank offer has been made, and the judge is told of its existence? Is the judge, in effect, bound to treat such an offer as equivalent to an offer under CPR 36 and defer a ruling on costs until the conclusion of all stages of the litigation?

email service

Part 36 Offer | Service By Email Validated But Not Without Consequence

“I accept that a failure to comply with the rules of service in CPR Part 6 should not be taken lightly … No reason has been put forward by the claimant as to why the rules were not followed. On the other hand, it is clear that the defendants’ solicitors received the Part 36 offer on 15 December 2020. Mr Seitler does not contend otherwise. No complaint was made about the method of service of the Part 36 offer until shortly before the hearing on 3 November. No suggestion has been made that there is any prejudice to the third defendant in the Part 36 offer having been sent by email rather than having been served in some other way, for example by post. In these circumstances, it would in my view be … “a triumph of form over substance” if the court were to make an order invalidating the Part 36 offer…”

boats colliding

Part 36 Consequences Superseded By Settlement Agreement

“I am satisfied that the Settlement Agreement was a binding contract that superseded the acceptance of the Part 36 Offer. This was because on 26 May 2020 the parties chose to conclude a written settlement agreement with fresh wording and an entire agreement clause. Looking at the parties’ fuller wording in the Settlement Agreement, and taking into account that the Part 36 Offer had been accepted and incorporated by way of an annex, the parties’ objective intention was to provide a fuller settlement agreement, not merely an agreement memorialising the Part 36 Offer