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England and Wales Court of Appeal (Civil Division) Decisions |
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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Factortame Ltd & Ors v Secretary Of State For Transport [2002] EWCA Civ 22 (28 January 2002) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2002/22.html Cite as: [2002] CPLR 385, [2002] 1 WLR 2438, [2002] WLR 2438, [2002] EWCA Civ 22, [2002] 2 All ER 838 |
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COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT
His Honour Judge Toulmin CMG QC
Strand, London, WC2A 2LL Monday 28 January 2002 |
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B e f o r e :
Vice President of the Court of Appeal
Civil Division
LORD JUSTICE WALLER
and
LORD JUSTICE SEDLEY
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Factortame Ltd & Ors |
Appellants |
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- and - |
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The Secretary of State for Transport (Now the Secretary of State for the Environment, Transport and the Regions) |
Respondent |
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Smith Bernal Reporting Limited, 190 Fleet Street
London EC4A 2AG
Tel No: 020 7421 4040, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
David P Friedman QC and Miss Rachel Ansell (instructed by the Treasury Solicitor for the Respondent)
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Crown Copyright ©
Lord Justice Waller :
Introduction
"Where (a) a defendant makes a Part 36 payment which the claimant does not accept, (b) the defendant then makes a significant amendment to his case on the basis of information which had always been available to him, and (c) the claimant then promptly accepts the Part 36 payment which he has previously refused, in general the answer should be that the claimant is the successful party."
He would suggest that the judge failed to have regard to that principle. Mr Friedman QC on the other hand would suggest that although it must be a relevant consideration that a party has amended his case just prior to the acceptance of a Part 36 offer, it is for the judge to assess the extent to which that amendment should dislodge the prima facie position that a person who has failed to beat the payment-in should pay the costs from the date on which the payment-in should have been accepted.
Background
"The Edwin Coe applicants have a separate argument on costs. They say that the information on revised catch data mitigating income, which they only received on 5th April 2000 (but which they should have received on 28th February 2000) changed fundamentally the nature of the claim, in that it had the effect of reducing significantly the sums which the Edwin Coe applicants were entitled to receive for period 2 losses. They say that the Government should pay all their costs in relation to these issues. They say, as I have already set out, that the fact that this information was decisive in their decision to accept the Part 36 payments is to be inferred from the fact that they sought a ruling from me on the admissibility of the evidence on Day 22 of the trial, and that they accepted the payments a few days after I had ruled that the evidence was admissible.
The Government says that if one considers the report of the Edwin Coe fisheries expert, Mr Cox, in November 1999 and his evidence at trial, it is reasonable to infer that the delay in providing the data made no difference to the Edwin Coe applicant's conduct of the case and consideration of the part 2 offers, since catch data as mitigating income was only used by Mr Dyson as a reasonableness check and not for the purpose of substantive calculations. I have no means of resolving this conflict. The Edwin Coe applicants have, as is their right, chosen not to waive privilege. There is no reason to suggest that they should have done so. My ruling was given on Day 22 of the trial, after much evidence had been given.
I am unable, on the evidence before me, to say or to infer what influenced the Edwin Coe applicants to settle their remaining period 2 claims. The furthest I can go on the evidence is to take some account of the chance that the additional data may have had an effect in relation to the period 2 claims in influencing the decision of the Edwin Coe applicants. This can best be done by extending the period for which the Government must pay the costs in relation to these issues. In relation to these period 2 claims, the Edwin Coe applicants are to be entitled to their costs to 14th February 2000. Thereafter they must pay the Government's costs in relation to these issues."
Approach of appellate court
"[that] last … principle requires an appellate court to exercise a degree of self restraint. It must recognise the advantage which the trial judge enjoys as a result of his 'feel' for the case which he has tried. Indeed, as it seems to me, it is not for an appellate court even to consider whether it would have exercised the discretion differently unless it has first reached the conclusion that the judge's exercise of his discretion is flawed. That is to say, that he has erred in principle, taken into account matters which should have been left out of account, left out of account matters which should have been taken into account; or reached a conclusion which is so plainly wrong that it can be described as perverse – see Alltrans Express Ltd v CVA Holdings Ltd [1984] 1 WLR 394 per Lord Justice Stevenson at 400 C-F and Lord Justice Griffiths at p. 403G-H."
The outline
"The part 36 payments … were very substantially less than the sums claimed originally by the applicants. Apart from one settlement at just over 50 per cent of the sum originally claimed, the other sums which were eventually accepted were a substantially lesser proportion of the sums claimed by the applicants."
(The reference to the 50 per cent figure does not relate to any of the Part 36 offers with which this appeal is concerned).
"I would agree entirely with Mr Porter that were one able to quantify reliably the amount of additional quantities of non-quota species caught by the applicants' vessels then credit may have to be given. However the answer to Mr Porter's proposition is that I do not see how one can establish what additional quantities if any were caught. There is no legal requirement to record non-quota species in EU log books during the base period: …."
That would seem to indicate a slight change of view as to whether the mitigating catch should be taken into account or not.
The law relating to costs
"The overriding objective in part 1 of the CPR is that the court should deal with cases justly, including a requirement that as far as is practicable the court should ensure that the parties are on an equal footing.
The detailed rules are contained in part 44 (costs) and part 36 (payments into court) and can be summarised as follows:
(1) The court has an overall discretion as to whether costs are payable by one party to another, and if payable the amount of those costs and when they are to be paid (part 44.3 (1)(a)(b) and (c)).
(2) If the court decides to make an order, the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party, but the court may make a different order (part 44(3)(2)(a) and (b)).
(3) It is to be inferred from part 36 rule 20 and the case of Findlay v Railway Executive [1950] 2 All ER 969 that a party which accepts a part 36 payment after the expiry of time for accepting such a payment becomes from that date the unsuccessful party when considering the principle in (2) above.
(4) In deciding what order to make, the court must have regard to all the circumstances, including (a) the conduct of the parties, (b) whether a party has succeeded on part of his case, even if he has not been wholly successful, and (c) any payment into court or admissible offer to settle made by a party (whether or not made in accordance with part 36) (part 44.3(4)).
(5) The conduct of the parties includes all conduct, both before and during the proceedings (part 44.3(5)).
(6) …
(7) A part 36 offer or payment requires the permission of the court if it is an offer to settle part of the claim or has been accepted more than 21 days after the offer of payment is made, unless the parties have agreed costs. In such cases, the liability for costs shall also be decided by the court; see part 36.11(3) and part 36.15. …
(8) Although it is expressed only to apply at trial, part 36.20 provides guidance where a party accepts a part 36 offer or payment after the 21 days. It provides that where at trial a claimant (a) fails to better a part 36 payment or (b) fails to obtain a judgment which is more advantageous than a defendant's part 36 offer, unless it considers it unjust to do so, the court will order the claimant to pay any costs incurred by the defendant after the latest date on which the payment or offer could have been accepted without needing the permission of the court. In reaching a conclusion on this issue, the court must take into account the consideration set out in part 36.21(5). …
Although a party which fails to accept a part 36 payment until after the expiry of time for accepting such a payment is deemed to be the unsuccessful party, this is only a starting point. The court must take into account all the circumstances in which the payment is made, and in particular the circumstances in part 36.21(5) in deciding whether it would be unjust to award the defendant its costs from that date, i.e. (a) the terms of any part 36 offer, (b) the stage at which such part 36 payment was made, (c) the information available to the parties at the time when the part 36 offer or payment was made, (d) the conduct of the parties with regard to the giving or refusing of information for the purposes of enabling the part 36 payment to be evaluated.
Although it was decided under the old Rules of the Supreme Court, in Ford v GKR Construction Limited [2000] 1 WLR 1397 at 1403 810, Lord Woolf MR commented in relation to both the old and the new rules that the court has power to make orders other than that costs follow the event where a party fails at the end of the trial to recover a sum larger than the payment into court. He emphasised that the general rule should not apply where it was unjust that it should do so:
"If a party has not enabled another party properly to assess whether or not to make an offer or whether or not to accept an offer which is made because of nondisclosure to the other parties of material facts or if a party comes to a decision which is different from that which would have been reached if there was proper disclosure, that is a material matter for the court to take into account in considering what orders should be made."
I do not understand Lord Woolf MR to be signalling a change in the law which permits a party to seek to interrogate another party as to its thinking behind the part 36 payment; but rather he was emphasising that if the other party was at an unfair disadvantage, because the party had failed to disclose documents or information that it was required to disclose, that was a material matter that the court should take into account.
In Jones v Jones Court of Appeal transcript 13th October 1999, at page 10 of the transcript, Lord Justice Chadwick made a similar point:
"The court may also take into account the circumstances which have given rise to a change of mind (whether or not to accept the payment into court). In particular, if the court was satisfied that the change of mind arising from a reassessment of the risk in the light of new material was attributable to the defendant's failure to produce that material at an earlier date (or now in contravention of some protocol), it might take the view that the plaintiff should not be required to bear all or some part of the intervening costs. If the defendant has failed to do what the rules or an order of the court require within the time prescribed, then the price of obtaining the permission of the court to do later what he should have done earlier may be that the plaintiff should have the chance to take the money out of court without penalty. The reason is that the costs which have been thrown away were not incurred by reason of a misreading of the position by the plaintiff on the basis of material which was or should have been available but by reason of the absence of available material which he should have had if the defendant had complied with his obligations."
These two extracts emphasise that in considering whether or not it would be unjust to penalise a party for the late acceptance of a part 36 offer, I should take into account any failure by the respondents to provide documents and information which they should have provided under the rules or which was material to the claimant's consideration of the part 36 offer. This is a separate issue to the question of whether the Government could properly refuse to clarify its part 36 offers when it was asked to do so. ….."
Was the judge right in the way he directed himself?
Submissions of the parties
Conclusion
Lord Justice Sedley:
Lord Justice Simon Brown: