Haynes v Department for Business Innovation And Skills

On acceptance of a Part 36 offer by one defendant in multi-party litigation, “the costs of the proceedings” ordinarily means the costs of proceeding against that defendant. Common costs require analysis by category. Non-specific costs incurred in any event are recoverable in full from each defendant with a relevant deemed costs order. Specific common costs should ordinarily be divided on an evidence-based basis, subject to evidential limitations and proportionality.

The claimant, the personal representative of an asbestos-related lung-cancer victim, accepted a Part 36 offer from the eighth defendant in proceedings issued against ten employers. The other claims were abandoned. The defendant accepted liability for the claimant’s costs in pursuing it, subject to assessment.

Costs Officer Lambert and Master Simons held that the defendant was liable for costs directly attributable to the claim against it and one-tenth of the common costs. The claimant appealed, arguing that the offer and deemed costs order covered all costs, or alternatively that common costs required a more detailed assessment.

1. Appeal allowed in part. The Part 36 offer settled the claim against the Department only. The phrase “the costs of the proceedings” in CPR r.36.10(1) meant the costs of proceeding against the defendant against whom the deemed order was made.
2. The divisible nature of the underlying injury did not determine the scope of the secondary costs liability. That conclusion followed from the language and context of the rule.
3. Common costs comprised non-specific costs incurred in any event and specific costs capable of identification and division. Non-specific costs were recoverable from the defendant at 100 per cent. Specific costs required evidence-based assessment rather than automatic division by the number of defendants.
4. The claimant had failed to provide evidence enabling a detailed allocation. Master Simons was therefore entitled to use a straightforward fraction on the material available. Proportionality could justify a less punctilious exercise.
5. The matter was remitted to Master Simons to identify the non-specific common costs, payable by the eighth defendant in full. The appeal was otherwise dismissed. The claimant received one-third of the appeal costs and one-third of the costs below.

• High Court (Queen’s Bench Division): Mr Justice Jay allowed the appeal in part from the order of Master Simons and remitted the issue of non-specific common or generic costs.
• Senior Court Costs Office: Costs Officer Lambert and, on rehearing, Master Simons held that the eighth defendant was liable for directly attributable costs and one-tenth of the common costs.