Wasted costs: Firm settled with defendant
The High Court has rejected an unusual application by a former client for wasted costs against a law firm which accepted its conduct of his case was “reprehensible”.
Deputy Master Grimshaw said that if the former client, whose claim was struck out, was concerned about being pursued by the defendant for costs, he could bring a claim against Peterborough firm Hegarty for professional negligence.
The client was really asking for an indemnity against those costs rather than a wasted costs order (WCO), the judge said.
Shadi al Tarboush, born in 1993, was hit by a motor vehicle while using a pedestrian crossing in Coventry in 2016.
Mr al Tarboush, represented by his litigation friend Abdulhadi al Tarboush, was “said to have suffered a severe traumatic brain injury as a result of the accident”.
The claim form was issued in 2019. The defendant agreed to a liability split and the case proceeded on quantum.
Deputy Master Grimshaw said what followed was an “extraordinary course of procedural failures”, during which the claimant repeatedly failed to serve expert medical evidence despite court orders to do so.
Putting it “as neutrally as possible”, he explained, the defendant’s experts raised “significant concerns about the apparent disparities” between the claimant’s reported symptoms and evidence from social media.
In February 2023, the master made a WCO against the claimant for a hearing the previous December and debarred him from relying on evidence that was not served in compliance with the orders.
The non-compliance “continued in terms of the arrangements for expert joint meetings”. The defendant applied in August 2023 to strike out the claim and for indemnity costs, as well as for a WCO against Hegarty.
Deputy Master Grimshaw struck out the claim in October 2023 and ordered indemnity costs.
Hegarty came off the record in January this year and Mr al Tarboush is now represented by Kinetic Law.
The defendant settled its wasted costs application against Hegarty the same month, with the law firm agreeing to pay £35,000 in costs, mainly in connection with the strike-out application but also the defendant’s other costs.
However, the claimant objected to a hearing set for the following month being vacated and it went ahead.
The master observed that, but for the settlement, “the issue would have been at large before me and I would have had to determine whether a WCO should have been made at all and, if so, the extent to which Hegarty should have been liable for paying the costs of the whole action”.
In these circumstances, “one can see why the claimant felt it unfair that the defendant and Hegarty could reach an agreement without resort to him, leaving him in the position that the defendant could recover any costs not recovered from Hegarty against him personally, particularly when the defendant was clear that it was not waiving such right”.
The claimant argued that, “given the repeated breaches of court orders and the acknowledged failings by Hegarty”, it was appropriate that a WCO should be made against the firm in respect of the entire action.
The law firm agreed that “its delays in conducting the claimant’s claim were reprehensible”, but the claim made against it was “not an appropriate subject for the court’s summary wasted costs jurisdiction and should be made (if at all) by way of a claim for damages”.
Deputy Master Grimshaw said the claimant wanted “the protection of a WCO to shield him, or his litigation friend”, from the defendant trying to enforce any costs against them personally.
Applying the three-stage test for WCOs set out in Ridehalgh, the judge said he would have “little difficulty” in finding that the law firm’s conduct was “improper, unreasonable and/or negligent” – the first stage of the test.
It was “particularly egregious” that Hegarty left the claimant unrepresented at the final strike-out hearing.
However, the claim came “into difficulty” on the second stage, which requires the conduct to cause the applicant unnecessary costs.
“I accept that Hegarty’s conduct caused the defendant to incur at least some unnecessary costs, but I am not persuaded that the claimant has incurred unnecessary costs, and no evidence has been put before me as to any such costs being incurred,” Deputy Master Grimshaw said.
The claimant had incurred a liability to pay the defendant’s costs of the action rather than incurring costs himself; this was not the purpose of the wasted costs jurisdiction.
“Insofar as the claimant (or his litigation friend) now has to pay the defendant’s remaining costs of the litigation, his recourse is to bring a professional negligence claim against Hegarty.”
Deputy Master Grimshaw also rejected the submission that the issue of potential dishonesty on the part of Mr al-Tarboush was irrelevant.
“It would create an unfairness should the claimant escape all liability for costs if, for example, the evidence was compelling that he had been dishonest with his solicitor or indeed within the action as a whole.”
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