Welsh v Walsall Healthcare NHS Trust (Costs)

In exercising the costs discretion, the starting point remains that the unsuccessful party pays the successful party’s costs. A departure is justified where, having regard to all the circumstances, including conduct and partial success, justice requires it. A claimant’s failure on individual issues does not automatically justify an issue-based order. Particular attention may be given to an issue that was unreasonably pursued and materially increased costs. The court should generally avoid attempting to allocate costs issue by issue where a percentage or other broad order will fairly reflect the parties’ conduct and overall success. A party may also have protected its position through an effective settlement offer. The court may order a reasonable payment on account where costs are subject to detailed assessment.

The claimant succeeded in a complex clinical negligence action concerning complications following bariatric surgery. She had also advanced allegations concerning consent and the choice between open and laparoscopic surgery, but withdrew those allegations at trial. The court had already determined that CPR 36.17(4) did not apply because the relevant offer was made less than 21 days before trial. The remaining questions concerned the exercise of the general discretion under CPR 44.2, the appropriate proportion of costs, and payment on account. The central issue was whether the claimant’s unreasonable pursuit of the consent issue justified a departure from the usual costs order.

1. The court had already concluded that the Part 36 offer did not attract the consequences in CPR 36.17(4), because it was made less than 21 days before trial and was therefore excluded by CPR 36.17(7)(c).
2. Under CPR 44.2, the general rule that the unsuccessful party pays the successful party’s costs remains a strong starting point. The court may make a different order after considering all the circumstances, including conduct, partial success and non-Part 36 offers. Conduct includes whether it was reasonable to raise, pursue or contest a particular allegation or issue.
3. The principles summarised in the White Book, and supported by Fox v Foundation Piling [2011] EWCA Civ 790, were accepted. There is no automatic requirement to reduce a successful party’s costs merely because it failed on one or more issues. An issue-based order requires a reason based on justice. Where practicable, a percentage or period-based order is preferable to detailed allocation of costs by issue.
4. The claimant was overwhelmingly the successful party. Her unsuccessful allegations concerning consent were nevertheless unusual. They were not properly arguable after the evidence had crystallised, were pursued unreasonably through trial, and caused substantial additional expenditure. That conduct justified a limited departure from the general rule. The court distinguished the circumstances from Webb v Liverpool Women’s Hospital NHS Foundation Trust [2016] EWCA Civ 365, where the relevant allegations had been dealt with briefly.
5. Taking the litigation as a whole, the fairest order was for the defendant to pay 85% of the claimant’s costs, subject to detailed assessment, and all its own costs. A payment on account of £212,500 was ordered, reduced by £100,000 already paid, leaving £112,500 payable by 4 pm on 11 October 2018.

First-instance costs judgment following the substantive judgment in Welsh v Walsall Healthcare NHS Trust [2018] EWHC 1917 (QB).