Mediation, costs, sanctions and reducing bills

Headlines about Bristow v Princess Alexandra Hospital tend to suggest that failure to mediate the costs aspects landed the defence with a huge costs sanction at detailed assessment.

In fact, the very first sentence of the brief costs judgment shows that the claimants lost over 43% at the assessment: “A bill was originally lodged for approximately £239,000 and the basic fact is that upon a detailed assessment this was reduced to £135,486.90.”

In this way, the costs sanctions in this case weigh fairly heavily on the claimant side as well, despite some reports focusing largely the narrower ‘failure to mediate’ point. So while Bristow may appear as ‘failure to mediate’ on the part of the defence, it is nevertheless clear from the judicial deduction applied to the claimant’s costs that there were also shortcomings there.

Furthermore, although the costs judge – Master Simons – awarded the claimant the costs of the assessment on the indemnity basis, he allowed only 80% of the relevant amount and actually reduced the bill for this final stage from around £82,000 to under £32,000: a significant reduction of some 61% for this stage alone (the figure quoted here includes his allowing for indemnity costs at 80%).

Costs specialist Acumension dealt with the assessment following BLM’s handling of the principal claim in Bristow for the NHSLA. All these organisations remain strong supporters of mediation in civil disputes generally, including, where appropriate, in costs matters. Mediation is a key part of effective modern dispute resolution and the courts, rightly, continue to send firm messages that there should be sanctions attached to a lack of engagement in it.

That said, it does seem more than reasonable to ask if a mediation in Bristow would really have been likely to secure anything like the 43% reduction that the costs judge ordered on the costs in the principal claim? As Master Simons said – possibly drily – in his judgment: “That is unusual in detailed assessments. One usually accepts a reduction in bills of perhaps 33 1/3 … so a reduction of 43% from the original bill is a factor that I have to take into account.”

About the Author

akAlistair Kinley is BLM’s Director of Policy & Government Affairs.

Alistair is responsible for BLM’s engagement with government departments and regulators on policy and public affairs issues and consultations affecting the firm and its customers. He coordinated BLM’s market-facing activities in connection with the Insurance Act 2015 and the consultations which preceded its publication and introduction in Parliament.

He is a member of the Civil Justice Council (CJC), a regular speaker and experienced commentator on legal and procedural reforms and was a contributing editor to the Law Society’s Litigation Funding Handbook (September 2014).

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