£39k Award of Costs Obtained in Case where Value Dropped Significantly

 

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ARC Costs recently assisted on a costs matter whereby the value of the claim had dropped significantly, leading the Paying Party to raise allegations of fraud with regards to the main action within their Points of Dispute.

 

Facts of the Case

The costs matter arose following a claim for compensation for a Claimant pedestrian who was injured as the result of a road traffic accident.

The Claimant suffered a compound fracture to their right tibia, permanent scarring, as well as sleep disturbances and flashbacks. The Clamant submitted a claim for general damages, as well as additional losses, which included a future loss for congenial employment.

The claim was issued, and the Defendant later denied liability and causation. The parties commenced settlement negotiations and the Claimant put forward a Part 36 offer in the sum of £40,000, which was accepted by the Defendant. This concluded matters between parties save as to costs. 

 

Issues Relating to Costs

ARC Costs were instructed to prepare a Bill of Costs for this case, and to assist in the negotiation of costs. The Bill of Costs included solicitor’s hourly rates work, Counsel fees and expert witness fees.

Within their Points of Dispute, the Paying Party sought to have the Bill of Costs struck out as they alleged that the Claimant had exaggerated their injuries. This allegation was somewhat interesting, as such allegations had not been raised in the main action and the legal dispute had been settled on a commercial basis between the parties.  The Paying Party further sought to have the Bill reduced by 60% due to alleged issues of proportionality.

The Paying Party argued that, as the Clamant stated in their claim form that the claim would amount to over £250,000, but the claim later settled for £40,000, the Claimant had fraudulently exaggerated their claim for damages.

Moreover, the Paying Party also alleged the Claimant made a loss of congenial employment to exaggerate the claim. The claim was made as the Claimant was no longer able to work within the fitness industry; however, they later commenced employment within an alternative industry, earning more than they had in his previous role.

Within our Points of Reply, ARC Costs argued that the Defendants had agreed to settle the claim in the sum of £40,000, thereby agreeing to pay the costs of the action and as such the allegations of fraud were meritless. We submitted the argument that, if the Defendants had major concerns regarding the legitimacy of the claim, they should not have sought to resolve and settle the claim for damages. 

Furthermore, in relation to the reduced settlement of the case, ARC Costs argued that, the original Schedule of Loss was based upon the full value of the claim; however, as the Defendant denied liability and the Claimant was put to strict proof for most aspects of the claim, a Claimant must realistically take into account the submissions of the Defendant.

In relation to the Defendant’s arguments in relation to the Claimant’s loss of congenial employment, we put forward the argument that, the Claimant was unfit to work in his previous line of work due to the accident, and as such the Claimant initially considered quantum to include loss of congenial employment as they enjoyed their previous line of work and would not have changed the said line of work if not forced to. However, since the Claimant subsequently came to earn more than their previous line of employment, that the Claimant was happy to settle the matter at a significantly lesser amount than originally pleaded.

Following the submission of the Replies to Points of Dispute, the Paying Party put forward a Part 36 Offer for costs of £39,000.  This reflected a substantial recovery of the costs claimed.

 

How can ARC Costs Assist?

ARC Costs have an exceptionally skilled and experienced costs team to assist both paying parties and receiving parties with their legal costs matters. 

We can assist throughout the process of Detailed Assessment in preparing your Bill of Costs , as well as negotiating with the other side on the level of costs to be recovered. As independent experts, out services extend to either Paying or Receiving parties, and we often deal with disputes to Bills via settling Points of Dispute or Replies, as well as providing costs advocacy services if needed.

Should you require any assistance or free initial advice, please feel free to call us on 01204 397302, or email one of our costs experts direct on info@arccosts.co.uk.

 

 

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01204 397302

info@arccosts.co.uk

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