August 7, 2018

High Court overturns ruling that QOCS automatically applied to claim with PI element

The High Court has ruled that a circuit judge was incorrect in ordering that qualified one-way costs shifting (QOCS) automatically applied to a claim concerning misuse of data because it also included a personal injury (PI) element.

Applying the guidance in Robert Jeffreys v The Commissioner of the Police of the Metropolis [2017] EWHC 1505 on whether QOCS protection applies where a claim encompasses a claim for personal injury along with other elements, the first instance decision was overturned.

Background

This was an appeal against a judgment by HHJ Luba QC in relation to one aspect of the costs of an action brought by Andrea Brown, a former police officer, against the Commissioner of Police of the Metropolis ("the First Defendant") and the Chief Constable of Greater Manchester Police ("the Second Defendant"). She brought four separate causes of action:

  1. Breaches of Data Protection Act 1998
  2. Breaches of the Human Rights Act 1998
  3. Misfeasance in public office
  4. The misuse of private information

The Defendants conceded on 1 and 2, the Claimant lost on 3, and won 4 at a hearing. The judge also rejected the claimant's claim for aggravated and exemplary damages.

As part of those causes of action, the Claimant advanced a claim for personal injury, alleging she had suffered depression. The Judge held that she had not suffered any personal injury in the form of any recognised psychiatric injury and that the breaches of the DPS did not cause or materially contribute to any such injury she might have been able to establish. The judge did accept that she had suffered distress sufficient to warrant an award of damages under s.13(2) Data Protection Act 1998.

His Honour Judge Luba QC made a single global award of general (compensatory) damages to reflect the three causes of action on which she had succeeded. The Claimant was awarded £9,000. On the basis on a two-thirds/one-third apportionment of the damages between the Met and GMP, the respective awards against each Defendant were less than the Part 36 Offer made by the Met on 26 February 2016, and equal to the Part 36 offer made by the GMP on 2 May 2016.

At a subsequent hearing on costs, HHJ Luba QC held that Ms Brown was entitled to QOCS protection. He then ordered that the Defendants pay 70% of the claimant’s costs up to the date of their respective Part 36 offers, and thereafter ordered the Claimant to pay the costs of the Defendants. The Defendants were unable to enforce this order due to the finding that QOCS applied.

Appeal

The Defendants appealed arguing that the judge had erred in law in construing CPR Part 44 as providing the claimant with automatic QOCS protection. The Defendant's argued that as this was a 'mixed' claim it fell within CPR 44.16 (2) (b) in that it is subject to the judge's discretion whether QOCS applies.

The Claimant sought to uphold the original decision and was supported by the Equality and Human Rights Commission (EHRC). The EHRC were granted permission to intervene in the case. 

The decision made by HHJ Luba QC came before Morris J's ruling in Jeffreys and also before the even later decision in Siddiqui v Chancellor, Master and Scholars of the University of Oxford [2018] EWC536 (QB).

The EHRC argued that QOCS "should be construed so as to provide certainty for claimants making personal injury claims that they would not be subject to adverse costs orders, even if ultimately unsuccessful, subject only to narrow exceptions."

The EHRC stated the ruling in Jeffreys had a "chilling effect" as the costs position was now "unsatisfactory".

Outcome

The appeal was granted. Mrs Justice Whipple found as follows:

  • CPR 44.16(2) applies to any proceedings where a claim has been made for personal injuries as well as something else. This matter would be considered a mixed claim;
  • Mixed claims are therefore within the scope of QOCS under 44.13(1) and CPR 44.16(2)(b) provides a mechanism to deal with mixed claims;
  • The question to be asked when considering issues such as this are as follows:
    • "In the proceedings, is the claimant claiming anything other than damages for personal injuries
      • If the answer is no, then QOCS protection applies automatically (subject of course to one of the other exceptions applying, where the case is struck out or dishonesty is found)
      • If the answer is yes, then the case is subject to the court’s discretion under CPR 44.16(2)(b)."
  • Mrs Justice Whipple accepted that in other cases, the position might be more nuanced, giving the example that in a RTA "where the personal injury claim is modest but the main issue in the case relates to damage to the car, the Court might consider it just to remove QOCS protection," as opposed to an ordinary RTA claim.  
  • When addressing the position advanced by the EHRC, Mrs Justice Whipple accepted that since the availability of public funding for personal injury and other cases had been reduced, many claimants had found it harder to access justice, but she made it clear that the QOCS regime was not intended to address the wider issue of access to justice. Mrs Justice Whipple stated that the position advanced by the EHRC meant "at its most basic, that mixed claims would have automatic protection. That would render CPR 44.16(2) entirely redundant, and so it cannot be right."
  • Concluding, Mrs Justice Whipple found that the Judge at first instance did have a discretion to permit enforcement of the Defendant's costs order to an extent he considered just under CPR44.16(2)(b).

What can we learn?

  • The decision provides much needed guidance and is consistent with that previously reached in the matter of Jeffreys v The Commissioner of the Police of the Metropolis, where HHJ Morris held that where parts of a claim were for personal injury, but parts were not, then QOCS protection would not apply to the non-PI elements.
  • As highlighted by Mrs Justice Whipple, allowing mixed claims automatic costs protection would potentially have the effect of claims being 'dressed up' with a PI element in order to gain the benefit of QOCS, and should be discouraged.
  • This claim is one of a number of recently determined cost decisions which have been beneficial to defendants. The recent decision of Hislop v Perde determined that there is no presumption of indemnity costs for late acceptance of offers to settle. Hislop found that where a defendant has accepted a claimant's Part 36 offer prior to trial, the fixed costs regime will apply in the absence of 'exceptional circumstances'. In this case, a 19 month delay, even with no reason to justify the delay, was not considered an 'exceptional circumstance'.
  • However, by contrast, in the claim of Holmes v West London Mental Health NHS Trust, the High Court ruled last week that a defendant who had waited 15 months to accept a Part 36 offer, whilst drip feeding lower offers, must pay indemnity costs covering the period of delay. HHJ Gore stated that the defendant's conduct was not "the norm" and therefore, his discretion allowed him to order indemnity costs.

Lucy Gallagher, Associate at Clyde and Co acted for the Chief Constable of Greater Manchester Police