Secretary of State for the Department of Energy And Climate Change & Anor v Jones & Ors
2014
COURT OF APPEAL (CRIMINAL DIVISION)
United Kingdom
CORAM
- LORD JUSTICE PATTEN
- LADY JUSTICE SHARP
Areas of Law
- Civil Procedure
- Contract Law
2014
COURT OF APPEAL (CRIMINAL DIVISION)
United Kingdom
CORAM
AI Generated Summary
On 21 December 2012, the court ordered the defendants to pay 80% of the claimants' costs. A subsequent issue arose concerning pre-judgment interest on disbursements exceeding £787,500, leading the trial judge to order a 4% interest rate above the base rate. The defendants contended that the rate should have been based on their solicitor's financial situation rather than the claimants. The court rejected this argument, holding that the trial judge was entitled to determine the interest rate based on the claimants' circumstances. Previous rulings and statutes, including the Senior Courts Act 1981, were referenced in reaching this decision.
Judgment
Lady Justice Sharp :
Introduction
On 21 December 2012, following an earlier judgment on liability in respect of the eight lead claims of the Phurnacite Workers Group Litigation (PWGL) brought by these claimants, Swift J ordered that the defendants should pay 80 per cent of the claimants’ costs of the action as agreed or assessed. Although there was then agreement that costs and disbursements would be subject to interest from the date of judgment in the usual way, there was not agreement on a further claim by the claimants for pre-judgment interest on disbursements. The litigation had been substantial. The trial on liability took more than six weeks, and the claimants’ disbursements exceeded £787,500. The pre-judgment interest on disbursements issue was dealt with at a hearing on 24 March 2013, and on 3 May 2013, Swift J made a costs order which is the subject of this appeal. She ordered that the defendants pay pre-judgment interest on disbursements at the rate of 4 per cent above base rate.
It is not disputed that the claimants are entitled to interest on their paid disbursements. The narrow issue which arises for determination on this appeal relates to the rate of interest. The defendants contend the judge was wrong to have regard to the circumstances of the claimants when determining the rate of interest. They assert that given the way the claimants financed the litigation disbursements, interest should have been calculated by reference to the circumstances of their solicitors, Hugh James, rather than that of the claimants; and absent evidence to the contrary, Hugh James should be equated to a first class borrower so as to attract the conventional measure for such a borrower of 1 per cent above base rate.
For the reasons that follow I would hold that the judge was entitled to make the order she did, and I would dismiss the appeal.
Relevant background
The claimants in this case are former industrial workers of modest means who had worked at the defendants’ works in South Wales and who brought personal injury claims against the defendants. Their solicitors in the litigation were (and are) Hugh James, a medium-sized firm based in Cardiff.
The claimants entered Conditional Fee Agreements (CFAs) with Hugh James drafted on the Law Society’s model, which provided that payment of the solicitors’ charges was conditional on success, but disbursements were payable, win or lose (albeit the expectation in such cases would be that if the claimants los