Litigation Recent Decisions 02/12/97

Decisions are taken from Lawtel's legal database. LTL: Lawtel report; TLR: Times Law Reports; ILR: Independent Law Report

Hostile costs order in county court personal injury litigation

Burrows v Vauxhall Motors; Mongiardi v IBC Vehicles (1997)

Court: CA (Lord Woolf MR, Phillips LJ and Chadwick LJ) Summary: In what circumstances and at what stage should the County Court make a hostile order for costs in personal injuries litigation against a plaintiff on the basis of things done or not done before proceedings were commenced, and does it make any difference that the plaintiff had accepted a payment into court? Text: Two appeals raising points of general importance in relation to the powers of the County Court to deal with costs unnecessarily incurred as the result of the premature issue of proceedings in personal injury actions where liability was not in issue. In each of these actions the plaintiff was injured in the course of his employment with the defendant. In each case the liability, if any, fell on the defendant's insurers who had great experience in such matters. The insurers, realising that it was probable that the defendants would be held liable for the plaintiff's injuries, were concerned to explore the possibility of settlement of the claims before the costs of litigation were incurred. The insurers contended that the plaintiff acted unreasonably in commencing proceedings by the issue of a summons in the County Court before they had had a proper opportunity to make an offer of settlement based on the medical report. In each case, on sight of the medical report, the defendant made a payment into court which the plaintiff accepted. In the Burrows case, the payment in was made within the period allowed in the County Court Rules 1981. The district judge ordered that there be no order as to the plaintiff's costs before the date of the first payment in, but that the plaintiff's costs thereafter should be paid by the defendant. In the Mongiardi case, the plaintiff accepted the payment in out of time and the district judge ordered that the defendant pay the plaintiff's costs down to the date on which the time for acceptance of the payment in had expired and that the plaintiff should pay the defendant's costs thereafter. The County Court judge held that the district judge was right but for the wrong reasons. There was no principle which imposed an obligation on the plaintiff not to issue premature proceedings. The issues raised by the appeals were: (1) in what circumstances should the County Court make a hostile order for costs in personal injuries litigation against a plaintiff on the basis of things done or not done before proceedings were commenced; (2) does it make any difference that the plaintiff had accepted a payment into court and; (3) at what stage in the litigation (if at all) should such an order be made.