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We bring you news this week of two further awards now adorning the Deka trophy cabinet, the importance of which can hardly be overstated. Laura Begley won the Chambers & Partners Personal Injury Junior of the Year award on Thursday; and no sooner had we dusted ourselves down after the inevitable celebrations than Dominique Smith won the London Legal Support Trust Great Legal Bake prize for Best Overall Cake. And it was whilst we were congaing around chambers in response to that piece of news that we received the shock tidings that the fixed recoverable costs regime will not now be extended until October 2023 – on which, more below, along with a further decision on service, this one involving the Lugano Convention, which we still regard as excitingly exotic.
Further Delay to the Extension of Fixed Recoverable Costs
It was announced on 18th November 2022 that the fixed recoverable costs regime would not be extended until October 2023.
Fixed recoverable costs set out the amount of legal costs that can be recovered by the winning party at different stages of litigation, including interim hearings, trials and settlement. This means that in cases that fall within the fixed cost regime, the court will order that the unsuccessful party only has to pay a specific amount of costs, which are fixed. Currently, only certain types of claims are subject to fixed costs.
Fixed recoverable costs were first implemented for road traffic accident cases up to £10,000 damages in 2010.
At present, fixed costs apply to:
From March to June 2019, the government held a consultation on extending fixed costs in civil cases in England and Wales. This followed the publication of Sir Rupert Jackson’s review of civil litigation costs in July 2017. The key recommendations were for:
On 6th September 2021, the Ministry of Justice responded to the 2019 Consultation paper that followed Sir Rupert Jackson’s 2017 Review, endorsing fixed recoverable costs, but only for claims worth up to £100,000.
“Following Sir Rupert’s recommendation, the Government believes that a simplified scheme of costs, such as fixed recoverable costs, has the advantages of (i) reducing actual costs (through a simpler procedure); (ii) ensuring that costs are proportionate; and (iii) controlling costs in advance, which promotes both certainty and discipline and encourages earlier settlement. In principle, then, this is what our new fixed recoverable cost schemes seek to deliver, and in doing so, they will enhance access to justice.”
The Ministry of Justice has confirmed that fixed recoverable costs will be extended to cover all claims valued at up to £25,000. In addition, the fast track will also be extended to include non-complex claims valued at between £25,000 and £100,000, with fixed recoverable costs applying to these cases. In short, the proposals are to extend fixed recoverable costs to most civil cases valued up to £100,000.
The reforms will undoubtedly have a far reaching impact on a number of cases, which until now, did not fall within the fixed cost regime because of the nature of the claim or its value. Clinical Negligence claims are being looked at and considered separately and have therefore not formed part of the consultation process in relation to these proposed reforms.
The original deadline for introducing these reforms was set to be October 2022. However, in May 2022, it was announced that there would be a delay until April 2023. This was because two matters were deemed necessary to consider further:
Further delays to that deadline have now been made clear, pushing any likely implementation date to October 2023 due to logistical difficulties in re-drafting the rules.
Ministers have said that fixed costs will give both parties certainty about the amounts they will have to pay if they are unsuccessful and will ensure that costs are proportionate.
However, there is significant concern about the way in which these reforms will change the landscape of civil claims going forwards into the future. Critics say the proposals risk driving lawyers out of civil justice work if the costs are too low and will leave litigants to represent themselves.
For now, it looks likely that there will be a further delay to see what these reforms will look like in the rule book and in practice.
About the Author
Lucy Lodewyke was called in 2018 and undertakes work across all of chambers’ practice areas. Prior to coming to the Bar she worked as a paralegal at Stewarts in the Personal Injury Department, and then as a paralegal to a barrister specialising in personal injury and clinical negligence work. This invaluable experience has given her an insight into the profession from another perspective, with knowledge beyond her call.
Service out of the Jurisdiction in Legacy Lugano Convention Cases
This casenote is produced for that small cohort of practitioners who have legacy Lugano Convention claims they have not yet served; and for those, like the author, with a curiosity regarding How These Things Work.
In CA Indosuez (Switzerland) SA v Afriquia Gaz SA  EWHC 2871 (Comm) Robin Knowles J was asked to determine whether the Part 20 Claimant required permission to serve proceedings on the Swiss Part 20 Defendant outside the jurisdiction. Switzerland, you will recall, is not a party to the Brussels or recast Brussels Conventions, but is a signatory to the Lugano Convention.
The defendants and Part 20 claimants (AG and MG) had purchased a cargo of butane from the first Part 20 defendant (GP). GP had trade finance facilities with two Swiss banks: the claimant (C) and UBS. GP assigned to C the debt represented by the purchase price. GP issued invoices to AG and MG and C gave notice of assignment. However, AG and MG paid the sums due to GP’s account with UBS. GP instructed UBS to transfer the sums received to C but UBS refused, claiming to be entitled to set off those sums against GP’s liabilities. C brought proceedings against AG and MG for the purchase price, and AG and MG brought Part 20 claims against GP and UBS. The Part 20 claim form against GP and UBS was issued on 30th December 2020, before the end of the Brexit transition period. The sale contract between GP and AG and MG contained an exclusive English jurisdiction agreement, and AG and MG served the Part 20 claim on GP out of the jurisdiction in the United Arab Emirates without permission on the basis of the jurisdiction clause under Article 25 of the recast Brussels Convention. They served the Part 20 claim on UBS out of the jurisdiction in Switzerland without permission as third party proceedings under Article 6(2) of the Lugano Convention. C’s claim against AG and MG had been settled after the court directed that it should proceed ahead of the Part 20 claims. GP was not defending the claim against it.
All clear so far? On to the legal question.
The service challenge
UBS argued that:
UBS’ service challenge failed. Knowles J held that:
The decision is an interesting indication that, as practitioners had long suspected, Lugano claims are treated as working in parallel with claims falling with the recast Brussels Convention, even though there are significant differences between the two jurisdictional regimes. It is also of interest to practitioners more widely because the judge held that the position in the main claim at the time of the application was irrelevant; it is the existence of a main claim at the time of issue that counts for these purposes. It is suggested that this must be right, and for the reasons the judge gave; to hold otherwise would encourage parties not to settle proceedings for strategic reasons, which is clearly undesirable. To this extent the case is of more than passing interest to anyone undertaking cross border work.
About the Author
Called to the Bar in 1997, Sarah Prager has been listed in the legal directories as a Band 1 practitioner in travel law for many years. Together with her colleagues at Deka Chambers, Matthew Chapman KC and Jack Harding, she co-writes the leading legal textbook in the area, and has been involved in most of the leading cases in the field in the last decade. Last year she was named Best Lawyers’ Travel Lawyer of the Year and the Lawyer Monthly Women in Law Awards: Personal Injury, and she was a member of the Consultative Group of Experts to the UNWTO Committee for the Development of an International Code for the Protection of Tourists, and is a member of the Admiralty Court Users’ Committee. She undertakes purely domestic high value personal injury work as well as cross border work and has a wealth of experience of difficult and sensitive cases.