Ford v GKR Construction Ltd (Practice Note)

A claimant’s failure to beat a payment into court does not compel the usual costs order. The court must consider all relevant circumstances, including the late disclosure of evidence, the late introduction of issues and whether those matters prevented an informed assessment of the payment.

Open and timely disclosure is essential to effective settlement. A party’s failure to disclose material information may make the usual costs consequences unjust. An appellate court may interfere with the trial judge’s costs discretion only where its exercise was flawed or plainly wrong.

The claimant obtained £85,323 damages, plus interest, for personal injuries sustained in a road traffic accident. Liability had been admitted. Although the damages were less than the defendants’ pre-trial payment into court, the county court ordered the defendants to pay the claimant’s costs throughout.

After the assessment hearing had begun, the defendants obtained surveillance recordings and additional medical evidence concerning future care. The judge admitted that evidence, which substantially reduced the damages. The claimant then offered to accept the money in court with her costs, but the defendants insisted that she pay their costs from the date of payment-in.

The defendants appealed against the costs order. The central issue was whether the judge’s exercise of discretion was flawed or plainly wrong.

1. Appeal dismissed unanimously. Lord Justice Judge delivered the leading judgment. Lord Justice Pill and the Master of the Rolls agreed. An appellate court could not interfere merely because it might itself have made a different costs order. Intervention required the trial judge’s exercise of discretion to be flawed or plainly wrong.

2. The usual consequence of a claimant failing to beat a payment into court was only a starting point. The trial judge had to consider all relevant aspects of the litigation. These included late disclosure, late evidence, unanticipated contentions, the stage at which they arose and their effect on the result.

3. The surveillance recordings and medical evidence could and should have been obtained before trial. Their late admission substantially reduced the damages and brought the award below the payment-in. The defendants therefore received the evidential advantage to which they were entitled. The judge nevertheless retained a separate discretion concerning costs.

4. The claimant had not acted dishonestly. Her inaccurate presentation of her condition was consistent with the fluctuating mental illness found by the judge. After seeing the recordings, she responded reasonably by attempting to settle by reference to the money in court. The defendants did not respond comparably. The judge was entitled to take those matters into account.

5. Lord Justice Pill added that parties should prepare fully for trial, disclose the particulars of their cases and identify the remaining issues. The defendants had no evidential basis for expecting that cross-examination would make the additional evidence unnecessary.

6. Lord Woolf MR emphasised that prompt and proper disclosure had greater importance under the Civil Procedure Rules. The normal consequences under Part 36 may be displaced where they would be unjust. A failure to provide information needed to assess an offer, or to decide whether to make one, is material to the court’s costs decision.

7. The appeal was dismissed with costs, with a legal aid assessment of the defendants’ costs.

1. Court of Appeal: The defendants’ appeal against the costs order was dismissed unanimously. The claimant retained her costs throughout.

2. Cardiff County Court: His Honour Judge Gaskell awarded the claimant £85,323 damages plus agreed interest of £4,000. Although she failed to beat the defendants’ payment into court, he ordered the defendants to pay her costs of the action.