Hard times

The Civil Proceedings Fees Order 2008 amongst other horrors, provides a set of convoluted provisions for remission of court fees for people of modest means.

A complicated scheme is set up by article 5 and schedule 2 of the Order, providing that if a gross monthly income and/or disposable income test is met, then a party can be granted a fee remission.

The amount of detail required to complete a fee remission application, and the supporting documents is frankly eyewatering, and must be completed on a “per fee” basis, not a per case basis, so potentially requiring multiple applications during the same piece of litigation.

I am seeing points of dispute arise that paying parties can take advantage of a receiving party’s right to a fee remission to argue that they should not have to pay court fees, which may have been paid by the receiving party.

The arguments put forward by paying parties are that in circumstances where court fees are paid when a client is entitled to a remission, the payment constitutes an unreasonable expense, as the receiving party could have avoided the expense entirely. The argument is not the same as, but akin to, an argument that the failure to claim a remission is a failure to mitigate.

Such an argument is likely to be misconceived for two reasons. The first is that the sheer amount of time a solicitor must spend, to complete the applications will in many cases outweigh the savings to be gained from doing so. The decision to pay the court fee may actually be a conscious decision to adopt a cheaper course of action.

The second reason arises from a point of law. Many personal injury practitioners will be familiar with the battles a decade ago, where it was argued on the part of the insurers that they could reduce their claims for care, by requiring a claimant to claim their entitlements to social care from the public purse, and if they did not, that claimant was acting unreasonably in failing to mitigate their loss and the sums which could have been obtained from the state, should be deducted from the damages they were claiming for care costs.

In the case of Peters v East Midlands Strategic Health Authority [2010] QB 48, the Cout of Appeal found no difficulty in finding that the argument was misconceived, as the claimant had a right to claim damages from a tortfeasor without any requirement to mitigate their loss by reliance on the public purse:

53 Having reviewed these authorities, we can now express our conclusion on this issue. We can see no reason in policy or principle which requires us to hold that a claimant who wishes to opt for self-funding and damages in preference to reliance on the statutory obligations of a public authority should not be entitled to do so as a matter of right. The claimant has suffered loss which has been caused by the wrongdoing of the defendants. She is entitled to have that loss made good, so far as this is possible, by the provision of accommodation and care. There is no dispute as to what that should be and the council currently arranges for its provision at The Spinnies. The only issue is whether the defendant wrongdoers or the council and the PCT should pay for it in the future.

54 It is difficult to see on what basis the present case can in principle be distinguished from the case where a claimant has a right of action against more than one wrongdoer or a case such as The Liverpool (No 2) [1963] P 64 where a claimant has a right of action against a wrongdoer and an innocent party. In The Liverpool (No 2) , those two cases were treated alike. In our judgment, the present case should be treated in the same way. It is true that in the present case, the claimant’s right against the council is the statutory right to receive accommodation and care. But the fact that there is a statutory right in the claimant to have his or her loss made good in kind, rather than by payment of compensation, is not a sufficient reason for treating the cases differently.

If that is the position in relation to damages, it is difficult to see why it should be any difference in relation to costs, and a claimant declining to rely on a statutory right to fee remission and actually paying the court fees should be able to recover them as of right from the tortfeasor.

2 thoughts on “Hard times

  1. I am now seeing demands from the paying party for documents to say we have applied e.g “We note that the Claimant was retired and as such please confirm that Form EX160 was completed in order to satisfy ourselves and the Court that court fees were properly payable. If an application was unsuccessfully made for fees remission then please confirm and supply the relevant documentation in evidence. Until such confirmation is received, we make no offer for the court fee”.
    This is a means tested benefit and I see no reason why client’s should be forced to submit to the test if they don’t want to and/or why insurance companies believe they have a right to take advantage of the benefit

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