A B & Ors v Leeds Teaching Hospitals NHS Trust

The court has power to impose a costs cap in group litigation, although the Civil Procedure Rules contain no express provision for such an order. The power arises from the court’s broad costs jurisdiction, case-management powers and the overriding objective. In group litigation, exceptional circumstances are not required. The court should assess proportionality first by considering the global figure against the amount at stake and complexity, and then, if necessary, the proportionality of its component parts. The assessment should be broad and concern the costs of generic issues. A cap should protect access to a proper presentation of the case while preventing disproportionate expenditure, and should be capable of variation if unforeseen exceptional circumstances arise.

The claimants were involved in the Nationwide Organ Group Litigation concerning the retention of organs by hospitals. The defendant applied for a retrospective and prospective order capping the claimants’ costs from 10 February 2003 through to the end of the proposed trial. The parties accepted that such an order would be novel.

The court considered whether it had jurisdiction to make a costs cap order and, if so, the principles governing its exercise. The proposed cap concerned generic issues only and was assessed against a projected four-week trial.

1. Power to cap costs. The court held that it had power to make a costs cap order. Section 51 of the Supreme Court Act 1981, CPR 3.1(2)(m), CPR 44.3, the overriding objective in CPR 1.1 and section 6 of the Practice Direction about Costs, read together, provided sufficiently broad authority. The power applied in group litigation and other actions.
2. Exceptional circumstances. Unlike a pre-emptive costs order in administrative proceedings, a costs cap in group litigation did not require exceptional circumstances. The scale and nature of group litigation, and the risk of disproportionate and excessive costs, justified active control.
3. Proportionality and assessment. Proportionality was assessed by a two-stage approach. First, the global sum was compared with the amount at stake and the complexity of the issues. If disproportionate, the court then examined the component parts. The exercise had to be broad and realistic, without detailed assessment of every item. The cap was limited to generic issues and was not based solely on the defendant’s costs or the Legal Services Commission’s case plans.
4. Amount and variation. Taking account of the estimated damages, the complex legal issues, the relatively simpler factual issues, the four-week trial assumption and the component costs, the court assessed the cap at £506,500: solicitors’ costs £271,250, counsel’s fees £170,250, experts’ fees £50,000 and other disbursements £15,000. The claimants’ costs were capped at that amount from 10 February 2003 to the end of trial, with liberty to apply if unforeseen and exceptional factors affected costs.