Interim payments on account of costs
Enjoying the frivolities of the Christmas period can be an enjoyable, if not expensive, time of the year with payday falling early and lots of last minute items to purchase. No doubt all of us at one point or another have also then suffered what feels like an eternity between the pay days in December and January and money becomes tighter and tighter. This is pales into insignificance when you consider the likely ‘pay day’ in a complex litigation and clinical negligence matters are 5-10 years since the date of instruction.
However, in two cases in 2019 this issue was addressed. In I v Hull & East Yorkshire NHS Trust the Court allowed an appeal against the refusal to grant an additional payment on account of costs in a complex clinical negligence matter. Admissions of liability had been made earlier in the litigation but there remained significant time and investigations to be undertaken before quantum could be finalised.
In allowing the appeal and making an order for a further interim payment on account of costs in the sum of £150,000.00 Robinson J commented:
‘Failure to ensure adequate cash flow during the period of inevitable delay may lead to the perverse and undesirable consequence that solicitors are unwilling to take on case such as this at an early stage. It is everyone’s interests to determine liability as early as possible. But if the consequence is that solicitors must then fund the quantum investigation for 10 years or more, they may not be anxious to take the case on early.’
These positive comments have since lead to an increase in applications being made to obtain interim payments on account of costs. However, Master Cook had some advice for future applications in RXK v Hampshire Hospitals NHS Foundation Trust. Whilst the following list is not prescriptive, it is advisable that the more information that can be provided the better:
- the type of funding agreement and details of any payments made under that agreement,
- whether any Part 36 or other admissible offer has been made, and if so, full details of the offer,
- details of any payments on account of damages made to date,
- a realistic valuation of the likely damages to be awarded at trial,
- a realistic estimate of the quantum costs incurred to the date of the application,
- any other factor relevant to the final incidence of costs, such as the possibility of an issue-based costs order, arguments over rates or relevant conduct,
- the likely date of trial or trial window.
Further information on both these cases can be found by clicking on the following links: