Muhammad Tanveer Amjad v UK Insurance Limited [2023] EWHC 2832 (KB)

“2(c) If it is the Claimant's intention to rely on impecuniosity then the Claimant is to provide full financial disclosure, regardless of the country in which the financial accounts are held, in support of the same; should the Claimant fail to do so then they shall be debarred from relying upon impecuniosity at all. Such disclosure to include:- i) Wage slips (or other proof of earnings if self-employed) for the period 3 months pre-accident, covering the period of hire and 3 months after hire ended. ii) Bank/building society statements for any accounts held, either in sole or joint names for the period commencing 3 months pre-accident and continuing until the date 3 month after cessation of hire. iii) Copies of savings accounts statements for any accounts held, either in sole or joint name for the period commencing 3 month s pre-accident and continuing until the date 3 months after cessation of hire. iv) Copies of credit and/or charge card statements for any such cards held, either in sole or joint names for the period commencing 3 months pre-accident and continuing until the date 3 months after cessation of hire. v) Details of any loans and/or overdraft facilities held. With regards to overdraft facilities the Claimant is to provide details as to the limit and terms of any such overdraft. 3. Requests for copies/inspection are to be made by 4pm on 12th January 2022 and to be complied with within 14 days of receipt.”

“12. Pursuant to PD 16 paragraph 8.2(8) it is the Claimant's case that at the time of the accident and throughout the period of hire he was impecunious, in that he did not have the financial means to repair or replace his vehicle or to hire a replacement vehicle from the basic hire market without exposing himself and his family to unreasonable sacrifice pursuant to Langden-v-O'Connor [2003] UKHL 64. 13. The Claimant's financial position was such that his only reasonable means of replacing his vehicle whilst it was un-roadworthy was to hire a replacement vehicle on a credit hire basis. The Claimant will disclose evidence in support of his contention that he was impecunious in the normal course of directions relating to disclosure and exchange of witness statements.”

“Pursuant to PD 16 paragraph 8.2(8) it is averred that the Claimant has mitigated the claim for vehicle damage and car hire charges in that at the time of the accident and throughout the duration of hire the Claimant will say that he had insufficient funds to repair or replace his vehicle and had no alternative but to hire a replacement vehicle on a credit hire basis. The Claimant's disclosure will show that at the time of the accident he only had limited funds available to him. The Claimant hired a vehicle from Bespoke Credit Hire Ltd .”

“Hire of replacement motor vehicle following a road traffic accident 6.3 Where the claim includes the cost of hire of a replacement motor vehicle following a road traffic accident, the claimant must state in the particulars of claim— (1) the need for the replacement vehicle at the relevant time; (2) the period of hire claimed (providing the start and end of the period); (3) the rate of hire claimed; (4) the reasonableness of the period and rate of hire; and (5) if the claim relates to credit hire, whether the claimant could afford to pay in advance to hire a replacement car, and, if not, why not (“impecuniosity”). 6.4 In paragraph 6.3— (1) “relevant time” means at the start of the hire and throughout the period of hire; (2) the obligation to state the matters in paragraph (3) includes an obligation to state relevant facts.”

“25. By the far the largest part of this claim was a credit hire claim. It was not a claim which I have found to be grossly exaggerated in the manner that was found to be the case in Brown v Commissioner of Police of the Metropolis [2019] EWCA Civ. 1724, but it was a claim that has failed for reasons that I gave on a preliminary ruling at the trial. It seems to me that this is patently a case in which the claim is made in respect of a claim other than one to which this section applies because it is a claim for credit hire and, equally, it is very likely a claim made for the financial benefit of a person other than the claimant, namely the credit hire company. Therefore, CPR 44.16(2)(a) is in play. 26. The consequences of the credit hire claim to this case have been considerable. They are no doubt what drove the case to go to trial and no doubt also played a significant part in this being a case heard on the multi-track with costs budgeting and by the standards of litigation of this kind relatively generous budgets. In those circumstances the court should seriously consider making an order under CPR 44.16(2). 27. In reality, this was a case that in large part was about the credit hire and, in those circumstances, I do not consider it unjust to make an order under 44.16(2). Rather, justice to the defendant calls for an order to be made. There ought, however, to be a limit on that because, to defend this claim, the defendant would have had to incur costs in any event even if the credit hire claim had not been made. 28. It is not simply a case of deducting costs that would have been incurred to defend the claim because, as Mr Poole points out, the very fact of a Part 36 offer being made and being beaten itself so complicates the issue that one cannot simply say there is one set of circumstances in which a certain amount of costs would have been incurred and another set where a different set of costs would be incurred and it is the extra costs that might be laid at the door of the claimant. 29. Nevertheless, if the defendant is able to persuade a costs judge to depart from the costs budget and order a higher costs amount, there would be potentially an injustice if the defendant were able to enforce the costs to the full extent of the £21,464 set out in its current costs statement since it seems to me to allow that would potentially be to drive a coach and horses through the larger scheme of qualified one-way costs shifting. 30. Doing the best I can - and this is a very rough and ready approach seeking to do justice between the parties - I make an order under 44.16(2) but limit the amount against which the order for costs may be enforced to the sum of £15,000. May I make it absolutely clear that that is not a back of the fag packet summary assessment of costs in this case. That is simply to say that if the costs judge is persuaded to go beyond the budgeted costs, then as to enforcement that cannot go beyond the figure of £15,000.”

“9. The Judge failed to take into account, or give appropriate weight, to relevant factors: the Claimant was a person of modest means (the Judge accepting for other purposes that he earned c. £250 per week), the Judge accepted the claim was made for the financial benefit of another but only gave an order against the Claimant, the Claimant remained liable to the hire company for the entire amount, the Claimant had not been found guilty of any 'gross exaggeration' as might justify such an order. Accordingly, the Judge failed to take into account, or give appropriate weight, to material facts and failed to follow the suggested approach set out in paragraphs 56-59 Brown v The Commissioner of Police of the Metropolis [2019] EWCA Civ. 1724; [2020] 1 WLR 1257.”

“The legal principles 15. The following legal principles apply where a party seeks to raise a new point on appeal which was not raised below. 16. First, an appellate court will be cautious about allowing a new point to be raised on appeal that was not raised before the first instance court. 17. Second, an appellate court will not, generally, permit a new point to be raised on appeal if that point is such that either (a) it would necessitate new evidence or (b), had it been run below, it would have resulted in the trial being conducted differently with regards to the evidence at the trial (Mullarkey v Broad [2009] EWCA Civ. 2 at [30] and [49]). 18. Third, even where the point might be considered a ‘pure point of law’, the appellate court will only allow it to be raised if three criteria are satisfied: (a) the other party has had adequate time to deal with the point; (b) the other party has not acted to his detriment on the faith of the earlier omission to raise it; and (c) the other party can be adequately protected in costs. (R (on the application of Humphreys) v Parkingand Traffic Appeals Service [2017] EWCA Civ. 24; [2017] R.T.R. 22 at [29]).”

"48. The appeal here is against the Judge's findings of fact. Many cases of the highest authority have emphasised the limited circumstances in which such an appeal can succeed. It is enough to refer to only a few of them. 49. For example, in Henderson v Foxworth Investments Ltd [2014] UKSC 41, [2014] 1 WLR 2600 Lord Reed said that: "67. ... in the absence of some other identifiable error, such as (without attempting an exhaustive account) a material error of law, or the making of a critical finding of fact which has no basis in the evidence, or a demonstrable misunderstanding of relevant evidence, an appellate court will interfere with the findings of fact made by a trial Judge only if it is satisfied that his decision cannot reasonably be explained or justified." 50. We were also referred to two more recent summaries in this court explaining the hurdles faced by an appellant seeking to challenge a Judge's findings of fact. Thus in Walter Lily & Co Ltd v Clin [2021] EWCA Civ. 136, [2021] 1 WLR 2753 Lady Justice Carr said (citations omitted): "83. Appellate courts have been warned repeatedly, including by recent statements at the highest level, not to interfere with findings of fact by trial Judges, unless compelled to do so. This applies not only to findings of primary fact, but also to the evaluation of those facts and to inferences to be drawn from them. The reasons for this approach are many. They include: (i) The expertise of a trial Judge is in determining what facts are relevant to the legal issues to be decided, and what those facts are if they are disputed; (ii) The trial is not a dress rehearsal. It is the first and last night of the show; (iii) Duplication of the trial Judge's role on appeal is a disproportionate use of the limited resources of an appellate court, and will seldom lead to a different outcome in an individual case; (iv) In making his decisions the trial Judge will have regard to the whole of the sea of evidence presented to him, whereas an appellate court will only be island hopping; (v) The atmosphere of the courtroom cannot, in any event, be recreated by reference to documents (including transcripts of evidence); (vi) Thus, even if it were possible to duplicate the role of the trial Judge, it cannot in practice be done... 85. In essence the finding of fact must be plainly wrong if it is to be overturned. A simple distillation of the circumstances in which appellate interference may be justified, so far as material for present purposes, can be set out uncontroversially as follows: (i) Where the trial Judge fundamentally misunderstood the issue or the evidence, plainly failed to take evidence in account, or arrived at a conclusion which the evidence could not on any view support; (ii) Where the finding is infected by some identifiable error, such as a material error of law; 86. Where the finding lies outside the bounds within which reasonable disagreement is possible. An evaluation of the facts is often a matter of degree upon which different Judges can legitimately differ. Such cases may be closely analogous to the exercise of a discretion and appellate courts should approach them in a similar way. The appeal court does not carry out a balancing task afresh but must ask whether the decision of the Judge was wrong by reason of some identifiable flaw in the trial Judge's treatment of the question to be decided, such as a gap in logic, a lack of consistency, or a failure to take account of some material factor, which undermines the cogency of the conclusion. 87. The degree to which appellate restraint should be exercised in an individual case may be influenced by the nature of the conclusion and the extent to which it depended upon an advantage possessed by the trial Judge, whether from a thorough immersion in all angles of the case, or from first-hand experience of the testing of the evidence, or because of particular relevant specialist expertise."

"2. The appeal is therefore an appeal on a pure question of fact. The approach of an appeal court to that kind of appeal is a well-trodden path. It is unnecessary to refer in detail to the many cases that have discussed it; but the following principles are well-settled: (i) An appeal court should not interfere with the trial Judge's conclusions on primary facts unless it is satisfied that he was plainly wrong. (ii) The adverb 'plainly' does not refer to the degree of confidence felt by the appeal court that it would not have reached the same conclusion as the trial Judge. It does not matter, with whatever degree of certainty, that the appeal court considers that it would have reached a different conclusion. What matters is whether the decision under appeal is one that no reasonable Judge could have reached. (iii) An appeal court is bound, unless there is compelling reason to the contrary, to assume that the trial Judge has taken the whole of the evidence into his consideration. The mere fact that a Judge does not mention a specific piece of evidence does not mean that he overlooked it. (iv) The validity of the findings of fact made by a trial Judge is not aptly tested by considering whether the judgment presents a balanced account of the evidence. The trial Judge must of course consider all the material evidence (although it need not all be discussed in his judgment). The weight which he gives to it is however pre-eminently a matter for him. (v) An appeal court can therefore set aside a judgment on the basis that the Judge failed to give the evidence a balanced consideration only if the Judge's conclusion was rationally insupportable. (vi) Reasons for judgment will always be capable of having been better expressed. An appeal court should not subject a judgment to narrow textual analysis. Nor should it be picked over or construed as though it was a piece of legislation or a contract. 3. If authority for all these propositions is needed, it may be found in Piglowska v Piglowski [1999] 1 WLR 1360; McGraddie v McGraddie [2013] UKSC 58, [2013] 1 WLR 2477; Fage UK Ltd v Chobani UK Ltd [2014] EWCA Civ 5, [2014] FSR 29; Henderson v Foxworth Investments Ltd [2014] UKSC 41, [2014] 1 WLR 2600; Elliston v Glencore Services (UK) Ltd [2016] EWCA Civ 407; JSC BTA Bank v Ablyazov [2018] EWCA Civ 1176, [2019] BCC 96; Staechelin v ACLBDD Holdings Ltd [2019] EWCA Civ 817, [2019] 3 All ER 429 and Perry v Raleys Solicitors [2019] UKSC 5, [2020] AC 352 . 4. Similar caution applies to appeals against a trial Judge's evaluation of expert evidence: Byers v Saudi National Bank [2022] EWCA Civ. 43, [2022] 4 WLR 22. It is also pertinent to recall that where facts are disputed it is for the Judge, not the expert, to decide those facts. Even where expert evidence is uncontroverted, a trial Judge is not bound to accept it: see, most recently, Griffiths v TUI (UK) Ltd [2021] EWCA Civ. 1442, [2022] 1 WLR 973 (although the court was divided over whether it was necessary to cross-examine an expert before challenging their evidence). In a handwriting case, for example, where the issue is whether a party signed a document a Judge may prefer the evidence of a witness to the opinion of a handwriting expert based on stylistic comparisons: Kingley Developments Ltd v Brudenell [2016] EWCA Civ. 980." […] “52 … It need hardly be emphasised that "plainly wrong", "a decision ... that no reasonable Judge could have reached" and "rationally insupportable", different ways of expressing the same idea, set a very high hurdle for an appellant. [...] 54. These considerations apply with particular force when an appeal involves a challenge to the Judge's assessment of the credibility of a witness. Assessment of credibility is quintessentially a matter for the trial Judge, with whose assessment this court will not interfere unless it is clear that something has gone very seriously wrong. It is not for this court to attempt to assess the credibility of a witness, even if that were possible, but only to decide, applying the stringent tests to which I have referred, whether the Judge has made so serious an error that her assessment must be set aside."

“37. … these are appeals from case management decisions made in the exercise of his discretion by a judge who, because of his involvement in the case over time, had an accumulated knowledge of the background and the issues which this Court would be unable to match. The judge was in the best position to reach conclusions as to the future course of the proceedings. An appellate court should respect the judge's decisions. It should not yield to the temptation to “second guess” the judge in a matter peculiarly within his province. 38. I accept, without reservation, that this Court should not interfere with case management decisions made by a judge who has applied the correct principles, and who has taken into account the matters which should be taken into account and left out of account matters which are irrelevant, unless satisfied that the decision is so plainly wrong that it must be regarded as outside the generous ambit of the discretion entrusted to the judge.”

“We start by reiterating a point that has been made before, namely that this court will not lightly interfere with a case management decision. In Mannion v Ginty [2012] EWCA Civ. 1667 at [18] Lewison LJ said: “it has been said more than once in this court, it is vital for the Court of Appeal to uphold robust fair case management decisions made by first instance judges.”

“… the enjoinder that the Court of Appeal will not lightly interfere with a case management decision and will support robust and fair case management decisions should not be taken as applying, when CPR 3.9 is in point, only to decisions where relief from sanction has been refused. It does not. It likewise applies to robust and fair case management decisions where relief from sanction has been granted.”

" … The fact that different judges might have given different weight to the various factors does not make the decision one which can be overturned. There must be something in the nature of an error of principle or something wholly omitted or wrongly taken into account or a balancing of factors which is obviously untenable." " … The fact that different judges might have given different weight to the various factors does not make the decision one which can be overturned. There must be something in the nature of an error of principle or something wholly omitted or wrongly taken into account or a balancing of factors which is obviously untenable."

“1.1 Scope of this chapter. In this chapter I discuss the possible adoption of one way costs shifting in personal injuries litigation in the event that after-the-event (“ATE”) insurance premiums cease to be recoverable. This option was identified in chapter 25 of the Preliminary Report as one possible way forward. For the purpose of this chapter, I am treating personal injuries litigation as a broad concept, including claims where the claimant’s injuries were caused by clinical negligence. 1.2 Important features of personal injuries litigation. There are two important features of personal injuries litigation. First and self-evidently, the claimant is an individual. For the vast majority of individuals it would be prohibitively expensive to meet an adverse costs order in fully-contested litigation. The most recent Social Trends report shows that 73% of all households have savings (made up of securities, shares, currency and deposits) of less than £10,000. Defence costs can easily be many times higher than £10,000 in fully-contested litigation. This would mean that for three quarters of households their other financial assets (their own home in most cases) would be at risk from an adverse costs order. Secondly, the defendant is almost invariably either insured or self insured. By “self insured”, I mean that the defendant is a large organisation which has adopted the policy of paying out on personal injury claims as and when they arise, rather than paying substantial liability insurance premiums every year.” … “2.11 Conclusion. On the basis of the material provided during the Costs Review, it seems to me inevitable that, provided the costs rules are drafted so as (a) to deter frivolous or fraudulent claims and (b) to encourage acceptance of reasonable offers, the introduction of one way costs shifting will materially reduce the costs of personal injuries litigation. One layer of activity, namely ATE insurance against adverse costs liability, will have been removed from the personal injuries process.”

“4.1 In my view, the regime of recoverable ATE insurance premiums is indefensible for the reasons set out in chapters 9 and 10 above. On the other hand, most claimants in personal injury cases have for many years enjoyed qualified protection against liability for adverse costs and there are sound policy reasons to continue such protection. The only practicable way that I can see to achieve this result is by qualified one way costs shifting. 4.2 Despite the arguments of the MDU, the ABI and others, I do not regard it as practicable to introduce one way costs shifting for limited categories of personal injury cases, such as low value cases or CFA cases. Either one way costs shifting is introduced across the board for personal injury cases or, alternatively, two way costs shifting remains the rule, except for those protected by the legal aid “cap”

“Except in prescribed circumstances, costs ordered against an individual in relation to any proceedings or part of proceedings funded for him shall not exceed the amount (if any) which is a reasonable one for him to pay having regard to all the circumstances including: (a) the financial resources of all the parties to the proceedings, and (b) their conduct in connection with the dispute to which the proceedings relate…”

“Costs ordered against the claimant in any claim for personal injuries or clinical negligence shall not exceed the amount (if any) which is a reasonable one for him to pay having regard to all the circumstances including: (a) the financial resources of all the parties to the proceedings, and (b) their conduct in connection with the dispute to which the proceedings relate.”

“Qualified one-way costs shifting: scope and interpretation 44.13 (1) This Section applies to proceedings which include a claim for damages – (a) for personal injuries; (b)…”

“54 The starting point is that QOCS protection only applies to claims for damages in respect of personal injuries. What is encompassed by such claims? It seems to me that such claims will include, not only the damages due as a result of pain and suffering, but also things like the cost of medical treatment and, in a more serious case, the costs of adapting accommodation and everything that goes with long term medical care. In addition, contrary to the submissions advanced by Ms Darwin and Mr Jaffey, I consider that a claim for damages for personal injury will also encompass all other claims consequential upon that personal injury. They will include, for example, a claim for lost earnings as a result of the injury and the consequential time off work. 55 In other words, a claim for damages in respect of personal injury is not limited to damages for pain and suffering. For these reasons, as Whipple J noted at para 60 of her judgment, claimants in a large swathe of “ordinary” personal injury claims will have the protection and certainty of QOCS.” 56 I acknowledge that, in personal injury proceedings, another common claim will be for damage to property. For example, in road traffic accident litigation, there will usually be a claim for the cost of repairs to the original vehicle, and the cost of alternative vehicle hire until those repairs are effected. Such claims are not consequential or dependent upon the incurring of a physical injury: they are equally available to a claimant who survived the accident without a scratch as they are to a claimant who broke both legs in the accident.

“In my judgment, in order to give meaning to the phrase “a claim is made . . . other than a claim to which this Section applies” in rule 44.16(2)(b), it must be interpreted as referring to “proceedings which include a claim other than a claim for damages for personal injury.”

“… as a matter of construction, I conclude that CPR r 44.16(2)(b) applies in a case where, in proceedings the claimant has brought a claim for damages for personal injuries and has also brought a claim or claims other than a claim for damages for personal injuries.”

“15 On the issue of whether an overlap between the evidential basis for a personal injury claim and a non-personal injury claim precludes the operation of CPR r 44.16 (2)(b), Morris J said this in Jeffreys, at para 44: “As to … the alleged requirement for divisibility, in my judgment, there is no authority for the proposition that in order for CPR r 44.16(2)(b) to apply the personal injury claim and the non-personal injury claim must be ‘divisible’. There is nothing in the wording of the CPR provision itself to support this. Further, there is no reason in principle why there should be such a requirement. If the two claims are ‘inextricably’ linked or otherwise very closely related, then that relationship can be reflected in the exercise of discretion (in the claimant’s favour) which arises once CPR r 44.16(2)(b) applies.” 16 In applying that approach to the circumstances of that case, he said this after referring to two examples in para 52 of his judgment, at paras 53–54: “53. In my judgment, in each of these examples, proceedings in which claims were brought for those two different types of loss, namely the damage to property and the personal injury, would fall within CPR r 44.16(2)(b), even though they arose out of essentially the same facts and out of one and the same breach of duty. Each claim would be for different types of loss (personal injury and non-personal injury) and in claims where damage is an essential element of the cause of action, would in fact arise from different causes of action. There is no basis for requiring the personal injury claim and the non-personal claim to arise out of either distinct facts or distinct breaches of duty. Indeed, it is inherently likely that they will arise out of the same set of facts. What is important ultimately is whether they are claims for different types of loss. “54. In the present case, and even assuming that the malfeasance breaches of duty, indistinctly, caused the psychological injury, there remains the very substantial claims for damages for something other than damages for personal injury. Even though those claims were caused by the same breaches of duty, in my judgment, there were claims ‘other than a claim for damages for personal injury’. CPR r 44.16(2)(b) therefore applies.” 17 I respectfully think that this analysis is correct, the essential question being whether the claims advanced are for different forms of loss, one attributable to personal injury and the other not.” “As to … the alleged requirement for divisibility, in my judgment, there is no authority for the proposition that in order for CPR r 44.16(2)(b) to apply the personal injury claim and the non-personal injury claim must be ‘divisible’. There is nothing in the wording of the CPR provision itself to support this. Further, there is no reason in principle why there should be such a requirement. If the two claims are ‘inextricably’ linked or otherwise very closely related, then that relationship can be reflected in the exercise of discretion (in the claimant’s favour) which arises once CPR r 44.16(2)(b) applies.” “53. In my judgment, in each of these examples, proceedings in which claims were brought for those two different types of loss, namely the damage to property and the personal injury, would fall within CPR r 44.16(2)(b), even though they arose out of essentially the same facts and out of one and the same breach of duty. Each claim would be for different types of loss (personal injury and non-personal injury) and in claims where damage is an essential element of the cause of action, would in fact arise from different causes of action. There is no basis for requiring the personal injury claim and the non-personal claim to arise out of either distinct facts or distinct breaches of duty. Indeed, it is inherently likely that they will arise out of the same set of facts. What is important ultimately is whether they are claims for different types of loss. “54. In the present case, and even assuming that the malfeasance breaches of duty, indistinctly, caused the psychological injury, there remains the very substantial claims for damages for something other than damages for personal injury. Even though those claims were caused by the same breaches of duty, in my judgment, there were claims ‘other than a claim for damages for personal injury’. CPR r 44.16(2)(b) therefore applies.”

“The exception at CPR r 44.16(2)(b) 5.1 The proper interpretation 31. What is the proper interpretation of the words “other than a claim to which this Section applies”? It seems to me quite clear. “This Section” is the Section of the CPR setting out the QOCS regime. Rule 44.13(1) identifies the three types of claim which are covered by that regime: they are claims for damages for personal injury. Thus, if the proceedings also involve claims made by the claimant which are not claims for damages for personal injury (that is to say, claims “other than a claim to which this Section applies”), then the exception at rule 44.16(2)(b) will apply. 32. I consider that this is the sensible and straightforward interpretation of the rule. It also produces a logical and fair outcome. The QOCS regime only applies to claims for damages for personal injury. It does not apply to other types of claim. There is therefore no justification for allowing claims which are not claims for damages for personal injury (such as, for example, the data protection or police misconduct claims which were successful in the present case) to attract automatic QOCS protection. It would be equally wrong to allow claimants with a mixed claim to use the fact that their claims includes a claim for damages for personal injury to gain automatic costs protection in respect of their claims for non-personal injury damages. 33. In my view, the exception at rule 44.16(2)(b) was designed to deal with the situation where a claim for damages for personal injury was only one of the claims being made in the proceedings. In those circumstances, the automatic nature of the QOCS protection falls away. But of course, that is not the end of the matter: it then becomes a question of the judge’s discretion.”

“the unlawfulness of the arrangement as a whole. There remains one further aspect of the relationship, namely the responsibility for the cost of the litigation. Again the agreement is silent. In the simplest case, where only the hiring charge is the subject of claim, there is no problem. Since the action is brought at the company's request there is clearly an implied obligation not only to finance it, but also to cover the motorist's liability to the defendant in the event of failure. The position will be, at least in theory, less straightforward where there is a mixed claim, for personal injury as well as hiring charges, and where the action wholly or partially fails. It may be that in practice the company will bear all the costs involved, but the agreement does not say so, and in the event of dispute some difficult questions may arise. These may perhaps be solved by recourse to the analogy with subrogation, and if so the authorities collected in Clarke, The Law of Insurance Contracts (1989), p. 643, para. 31-6B3 may be germane. The point was not, however, explored in argument, and I do not think it profitable to do more than suggest that under this particular form of contract the motorist cannot be confident of a complete cover in respect of costs.”

“How does one estimate the value of these additional benefits that Mrs. Dimond obtains? It seems to me that prima facie their value is represented by the difference between what she was willing to pay 1st Automotive and what she would have been willing to pay an ordinary car hire company for the use of a car. As the judge said, 1st Automotive charged more because they offered more. The difference represents the value of the additional services which they provided. I quite accept that a determination of the value of the benefits which must be brought into account will depend upon the facts of each case. But the principle to be applied is that in the British Westinghouse case [1912] A.C. 673 and this seems to me to lead to the conclusion that in the case of a hiring from an accident hire company, the equivalent spot rate will ordinarily be the net loss after allowance has been made for the additional benefits which the accident hire company has provided.”

“My Lords the law would be seriously defective if in this type of case the innocent motorist were, in practice, unable to obtain the use of a replacement car. The law does not assess damages payable to an innocent plaintiff on the basis that he is expected to perform the impossible.”

“30 For present purposes I think that the relevant principles established by these decisions are as follows: (1) the loss of use of a car as a result of the car being damaged by the negligence of another driver is a loss for which, in appropriate circumstances, the innocent claimant can recover damages, even where the car is “non-profit earning”

“..it may be difficult to say that he can recover special damages at all. It may be that he can only recover general damages”. (3) The injured party cannot claim reimbursement for expenditure that is unreasonable. If the defendant can show that the cost that was incurred was more than was reasonable, either by proving that the claimant had no use for a replacement car in part or at all, or because the car hired was bigger or better than was reasonable in the circumstances, the amount expended on the hire must be reduced to the amount that would have been needed to hire the equivalent to the damaged car. As Lord Mustill put it in Giles v Thompson , “…The need for a replacement car is not self-proving”. (4) Even if it was reasonable for the innocent claimant to hire a replacement car on credit hire terms, the measure of damages recoverable will not necessarily be the amount of the credit hire that the claimant agrees to pay the credit hire company. It will depend on the financial circumstances of the claimant. If the claimant could afford to hire a replacement car in the normal way, ie. without credit terms and by paying in advance, then the damages recoverable for loss of use of the damaged car will be that sum which is attributable to the basic hire rate of the replacement car. This basic hire rate has often been referred to as the “spot rate”, but that is, with respect, a misnomer. The term “spot rate” is more appropriately applied to rates of freight or charter hire, or the price of a commodity in open, often international markets, where the service or commodity is bought for delivery today, as opposed to some time in the future. I think it would be better if, in the context of credit hire cases, the term “spot rate” were not used in future and the term “basic hire rate” or “BHR” were used instead. That term more accurately describes what is the basic measure of damages recoverable in cases where the claimant could afford to have hired a car by paying in advance, ie. not hiring the car on credit. (5) The difference between the BHR and the credit hire rate (assuming there is one) takes account of the additional services that a credit hire company provides to the hirer, viz. credit, handling the claim and effecting the recovery from the negligent driver, taking the risk of not recovering from the latter and an element of profit. Those elements are not part of the recoverable loss of a claimant who has hired a replacement car on credit hire terms but who could have afforded to do so by paying in advance. However, it is for a defendant to demonstrate, by evidence, that there is a difference between the credit hire charge agreed between the claimant and the credit hire company and the BHR. (6) If it was reasonable for the claimant to hire a replacement car but he could not afford to hire a replacement car by paying in advance, (in the word used in the cases, that he is “impecunious”) then, prima facie, he is entitled to recover the whole of the credit hire rate he has paid, provided that it was otherwise a reasonable rate to pay in the circumstances. If the claimant is “impecunious” then, on the assumption it is reasonable for him to hire a replacement car and it was a reasonable type of car that he hired, he is said to have had “no choice” but to hire on credit terms. In Lagden v O'Connor Lord Hope of Craighead suggested that a rule of thumb test on whether a claimant hirer is “impecunious” might be whether he has the use of a recognised credit or debit card. In practice whether someone is “impecunious” will depend on the facts of a particular case and Lord Hope's rule of thumb test is not necessarily determinative of the issue of whether a claimant can afford to pay hire charges day by day, which is the key question. (7) If the credit hire agreement provides that the hire will not be due and payable until judgment has been obtained against the negligent driver and there are no express terms in the hire agreement about the payment of interest on the hire charges then interest should not be awarded, at least under the terms of section 35A of the Senior Courts Act 1981 or section 69 of the County Courts Act 1984 . This is because, in such circumstances the hirer has not been “kept out of his money”; he was not contractually obliged to pay the hire charges to the credit hire company whilst the claim against the negligent driver was being assessed and (if necessary) litigated. No hire charges were then owed to the credit hire company. (8) In the judgment of the Court of Appeal in Burdis v Livsey, the court considered the method by which judges could calculate the BHR and so the measure of damages for loss of use in circumstances where the claimant was not “impecunious”

“They included the following: (i) Select had actually retained solicitors, Samuels Law, to act on its behalf in the claim. It was no coincidence that these solicitors were also instructed by the claimants. Select’s retainer eventually was terminated by letter dated 9 July 2015, nearly two years after the accident. (ii) Select was in direct e-mail contact with Esure concerning the progress of the claim, saying that Samuels Law was acting on its behalf and expressly inviting Esure to comment to it on the issue of liability. (iii) There was a close association between Select and a company by the name of Roy Lloyd Ltd. They shared a common director, Mr Justin Lloyd, who was the author of the witness statement relied upon by Select in resisting Esure’s claim for costs. In a written agreement between Miss Mee and Roy Lloyd Ltd in respect of credit storage, recovery and repair Miss Mee was contractually obliged to co-operate in the appointment of a solicitor nominated by the company in pressing a claim for damages. In the event that Miss Mee were to choose another solicitor her credit would automatically be terminated. (iv) Under her rental agreement with Select, Miss Mee gave Select the power to deduct directly from any moneys she may recover in respect of her personal injury claim to pay for any shortfall in damages relating to Select’s own claims against her. (v) Miss Mee gave an irrevocable authority to her solicitors to provide any engineering report in respect of her vehicle and further updates relating to that vehicle to Select. (vi) Miss Mee further granted Select the right to pursue an action in her name. (vii) Select was not merely providing Miss Mee with a hire car on credit, it was operating as de facto claims manager as is evidenced by its pro forma letter heading which states: “Revolutionising the way your claims are managed.” 25. Having concluded that Miss Mee and Select were “absolutely locked together”, the recorder went on to consider whether it would be just to make an order for costs against Select. In finding that it was, he noted that the preponderance of the claim was for the benefit of Select being in the sum of £23,456.85 in the context of a total claim worth less than £30,000.”

“57. But in such proceedings, the fact that there is a claim for damages in respect of personal injury, and a claim for damage to property, does not mean that the QOCS regime suddenly becomes irrelevant. On the contrary, I consider that, when dealing with costs at the conclusion of such a case, the fact that QOCS protection would have been available for the personal injury claim will be the starting point, and possibly the finishing point too, of any exercise of the judge’s discretion on costs. If (unlike the present case) the proceedings can fairly be described in the round as a personal injury case then, unless there are exceptional features of the non-personal injury claims (such as gross exaggeration of the alternative car hire claim, or something similar), I would expect the judge deciding costs to endeavour to achieve a “cost neutral” result through the exercise of discretion. In this way, whilst it will obviously be a matter for the judge on the facts of the individual case, I consider it likely that, in most mixed claims of the type that I have described, QOCS protection will “in one way or another” continue to apply. It therefore follows that, as already advertised at paras 16 and 17 above, to the extent that paragraph 12.6 of Practice Direction 44 suggests a different approach, I consider it to be wrong. It needs to be amended as soon as possible.”

“70 Finally, in connection with the deterrent argument, Ms Darwin made much of the need to ensure access to justice for victims of personal injury. Of course: that is what the QOCS regime is all about. But in the present case the appellant was not the victim of personal injury: her claim for personal injury damages was rejected and there was no appeal. The appellant did have a valid (non-personal injury) claim under the DPA and HRA and in tort on which she was successful. Her difficulty was that she had refused the offers of a total of £18,000 and at the end of the trial recovered just £9,000. In other words, the proceedings following the appellant’s rejection of the offer, were a waste of time and money for all parties, having been necessitated only by the appellant’s refusal to accept much more than she eventually recovered. Should the appellant be able to avoid the usual cost consequences of her conduct, merely because she had a claim for damages for personal injury which the judge rejected? For all the reasons I have given, the answer must be No, and no wider considerations of access to justice, properly analysed, can make any difference to that conclusion.”

“4. Contrary to Sir Rupert’s proposals, nothing in the QOCS scheme affects in any way (directly at least) the orders which a court may make in favour of defendants in PI cases, applying the general rules in CPR Pt 44, either at trial, at pre-trial interim hearings, at the conclusion of contested costs assessment proceedings post-trial or later still on appeal. The scheme focuses entirely upon what a defendant can do by way of enforcement of a costs order in its favour once obtained. The qualifications to the ban on enforcement inherent in the phrase “one-way” are of two types, one general and the other specific. 5 Generally, defendants’ costs may be enforced up to an amount equivalent to the aggregate of court orders for damages and interest in favour of the claimant. This is, as we shall later explain, a form of monetary cap on the amount of the costs orders made in the defendant’s favour which the defendant may enforce. The specific type of qualification consists of defined circumstances where there is no limit on enforcement, namely where the claimant’s claim has been struck out as disclosing no cause of action, as an abuse of process or on account of obstructive conduct of the claim, where it has been found to have been fundamentally dishonest, or where it has been pursued for the benefit of a third party. Costs incurred in the same proceedings in the pursuit of claims other than for personal injuries (such as replacement car hire) may also be enforced without limit.”

“65. In my judgment, the District Judge was correct to find that the claim for hire charges was brought for the financial benefit of a person other than the Claimant, namely the Appellant. The fact that a credit hire claim can only succeed if there is a valid and enforceable contract entered into between the Claimant and the credit hire does not obviate the fact that a hire claim may be for the ultimate financial benefit of a person other than the Claimant, namely the hire company.”

“30. In summary, the position is that more than a shared commercial interest in the outcome of litigation is required for a non-party to be categorised as the ‘real party’ to the litigation for the purposes of costs. The non-party must control and direct the litigation and its participation in the litigation will only render it liable to costs if, when running the litigation it is not furthering the interests of the named party. The way in which Mr Williams QC puts it is that the conduct of the non-party: “...must render the named party a ‘nominal party’ in both senses of that term.””… “CAUSATION 31 It is sufficient to refer to the dicta of Lord Briggs in Travelers at [65]: “I have noted ... how firmly the Court of Appeal ... endorsed the requirement ... to demonstrate a causative link between the incurring of the costs sought to be recovered from the non-party and some part of the conduct of the non-party alleged to attract the ... jurisdiction. That requirement is in my view rightly imposed... If the costs would still have been incurred if the non-party had not conducted itself in the relevant manner, why should it be just to visit the non-party with liability for them?” 32 At [80], Lord Briggs repeated the same point: “...causation remains an important element in what an applicant ... has to prove, namely a causative link between the particular conduct of the non-party relied upon and the incurring by the claimant of the costs sought to be recovered... If all those costs would have been incurred in any event, it is unlikely that a[n] ... order ought to be made.” 33 Lord Reed expressed himself in a similar fashion. He put it in this way: “...[the non-party] must, of course, have caused the expense for which he is sought to be made liable.” term.””… “I have noted ... how firmly the Court of Appeal ... endorsed the requirement ... to demonstrate a causative link between the incurring of the costs sought to be recovered from the non-party and some part of the conduct of the non-party alleged to attract the ... jurisdiction. That requirement is in my view rightly imposed... If the costs would still have been incurred if the non-party had not conducted itself in the relevant manner, why should it be just to visit the non-party with liability for them?” “...causation remains an important element in what an applicant ... has to prove, namely a causative link between the particular conduct of the non-party relied upon and the incurring by the claimant of the costs sought to be recovered... If all those costs would have been incurred in any event, it is unlikely that a[n] ... order ought to be made.” “...[the non-party] must, of course, have caused the expense for which he is sought to be made liable.”

“61. …In particular: (i) The claimant chose to contract with the appellant because he required a replacement vehicle; (ii) The claimant had the option to pay up front for the cost of hire or to enter into a credit hire agreement; (iii) The claim brought by the claimant was his claim in the sense that he was seeking to recover his personal losses which included, of course, the appellant’s hire charges but also, in particular, his claim for General Damages for personal injuries; (iv) The appellant neither controlled nor interfered with the conduct of the litigation. The appellant made no decisions whatsoever in relation to the conduct of the litigation; (v) The appellant was not provided with witness statements or with disclosure documents; (vi) The appellant had no dealings with the claimant other than to supply him with a replacement vehicle; (vii) The entirety of the litigation was conducted by Winns solicitors, an entity separate and distinct from the appellant; and (viii) In so far as the appellant had a contractual liability to indemnify the claimant against its costs, it discharged its obligation by arranging for the claimant to be insured against any adverse costs liability.”

“34 It is true that in such a case the permission of the court must be obtained before enforcement under CPR r 44.16 can take place, and that permission will only be given to the extent that the court considers it just to do so. Accordingly, it follows that a defendant in a mixed claim case where the personal injury claim is struck out is not in quite as good a position as a defendant where a personal injury claim is struck out and there is no “other” claim. However, as the court has power in the mixed claim case to make whatever order it considers will meet the justice of the situation, it is impossible to say that the claimant’s interpretation results in injustice or defeats the purpose of the QOCS rules.”

“65. Doing the best I can, in the exercise of my discretion under CPR 44.16(2)(b), I consider an appropriate level of enforcement to be 5%. In my judgment that figure properly respects the spirit of the QOCS regime and the starting point of the need for a costs neutral result in relation to the personal injury claims, but makes an appropriate allowance for the exceptional nature of the Mr Barratt issues insofar as they impacted on the non-personal injury claims.” 89. Hill J determined a similar issue in Afriyie v The Comm. of Police for the City of London [2023] Costs LR 1125. The claimant’s claims for assault and battery (PI claims) and misfeasance in public office (non PI claims) were dismissed after a trial. The defendant’s argument that: had the claims succeeded they should have been dismissed in any event under the Criminal Justice and Courts Act 2015, s 57 due to the claimant’s fundamental dishonesty was rejected. The defendant sought to enforce the costs under CPR r.44.16(2)(b). It was agreed that “in the round” the claims were to be characterised as PI claims. Hill J ruled that the defendant need to prove exceptional features to justify lifting the cap on the justice test. These are considered as follows: “33. Mr Ley-Morgan’s submissions were not directed to the question of whether there were any exceptional features of these claims. Instead he submitted that the following matters should be taken into account in the exercise of the general costs discretion under CPR r 44.2: (i) The claimant’s rejection of three (non-Part 36) offers by the defendant to settle the claim on a “drop hands” basis, leading to the wasted costs of the trials; (ii) The fact that the claimant did not limit his assault claim to the argument that the use of the taser was not objectively reasonable but instead made extremely serious allegations of bad faith and corruption on the part of the police officers; (iii) The claimant’s pursuit of a misfeasance claim which added nothing to the other claims (see [116] of the liability judgment) and which should therefore have been withdrawn; (iv) The defendant’s success on all the issues; (iv) The finding that the claimant’s conduct caused or at least contributed to the incident (see [155] of the liability judgment); (v) The “significant similarities” in the statements of the claimant, Mr Cole and Mr Grant (see [153] of the liability judgment); (vii) The finding that the claimant had been dishonest on the issue of whether he had cooperated with the breath test procedure (see [171] of the liability judgment); and (viii) The interview the claimant gave to The Guardian before the first trial (see [150] of the liability judgment), which was an unacceptable attempt to pressure the defendant to settle the claim, and his pursuit of an exemplary damages claim on the basis that it was grossly offensive for him to be cross examined about it. 34. In fairness to the defendant, I have considered whether any of these matters can properly be considered “exceptional”

“My analysis of the previous authorities on this issue makes clear that it is only by exercising control over the litigation that a non-party can be treated as the “real party” in the litigation.”

“is it just to lift the cap on enforcement against this claimant who: (1) has brought a claim for damages for personal injury and non PI; (2) which was not frivolous or an abuse of process; and (3) which has not been conducted in an abusive way; and (4) which was not fundamentally dishonest; and (5) has won some damages for personal injuries; and (6) has failed to beat a Part 36 offer resulting in a costs liability?”