Draft Third Parties (Rights Against Insurers) Act 2010 (Consequential Amendment of Companies Act 2006) Regulations 2018

Yet another gripping headline to draw in the reader of this blog … but despite the arcane title and multiple brackets these new regulations are worth knowing about. What they’ll do when implemented is to rectify a barrier to rights of recovery after an insurance policy covering a dissolved, insolvent or otherwise no-longer-existing insured has responded to a third party’s claim. Continue reading

Qualifying QOCS

It may be surprising that some details of Jackson costs reforms are still being refined in the courts more than five years after they were first implemented in April 2013. Adam Burrell explains the very recent decision in Budana v Leeds Teaching Hospital here. The case deals with success fees and assigned cases, but this post examines two cases on Qualified On-way Costs Shifting, QOCS.

The first is Howe v MIB, which we commented on here earlier in the year. We have since obtained a copy of the supplementary judgment*, available here, in which Lewison LJ explains why a costs set-off can and should co-exist alongside QOCS:[counsel for the claimant] submits that a set-off is enforcement and that set-off is only permitted against orders for damages and costs.  I do not agree. First, under the general law, set-off is not a species of enforcement … Sir Rupert Jackson envisaged that costs protection similar to Legal Aid’s cost protection should be given to claimants with QOCS.  The law in force at the time permitted set-off of costs against legally aided litigants and Sir Rupert made no recommendation to change that.  Moreover, Sir Rupert also envisaged that claimants would pay their own disbursements, so that, at least to some extent, unsuccessful claimants might end up out of pocket.  To allow set-off of costs would not, in my judgment, go against the thrust of his recommendations, and I do not consider that there is anything in the detailed rules setting up the QOCS regime which disapplies the court’s power to order set-off.”

This passage confirms, as was noted in our earlier piece about Howe, that the County Court decision in Darini v Markerstudy that QOCS was a form of costs enforcement should no longer be regarded as correct. 

The second case is Mabb v English, a decision of Jay J given on 6 December 2017 and in which the full judgment has yet to be published. The underlying action was a clinical negligence claim. The defendant clinician applied to strike it out on the grounds that it had no reasonable prospects of success. This was refused and the defendant appealed, at which point the claimant discontinued. By so doing she would benefit from QOCS protection, but if her claim was struck out she would lose it (CPR 44.15(a)). The defendant argued that the discontinuance should be set aside as it was an abuse of process which prevented him from recovering his costs.

Jay J refused to set the discontinuance aside. He recognised that the court had a discretion in CPR 38 to do so, which should be exercised to give effect to the overriding objective, i.e. to deal with cases justly and at proportionate cost. But it was not, on these facts, an abuse of process to take steps to avoid a costs liability and the claimant was not required to give a reason for discontinuing. The combination of CPR 38 & 44 meant that there were circumstances in which a defendant could lose the chance to secure an exception to the QOCS rule. That outcome was not inherently unfair in the present case.

We will post a link to the judgment in Mabb as soon as it is made available.

*© Crown copyright 2017. Contains public sector information licensed under the Open Government Licence v3.0 (http://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/).


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Written by Alistair Kinley, director of policy and government affairs at BLM.

Extending the scope of QOCS protection

The basis of QOCS is that the protection it affords against adverse costs applies to unsuccessful claims for personal injuries. These are conventionally argued in negligence against the defendant whose conduct caused the accident e.g. the negligent driver or employer. But should a statutory claim against an organisation which was not the tortfeasor be regarded as a claim for damages for personal injuries protected by QOCS?

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