Ferri v Gill

Under CPR 45.29J, departure from fixed recoverable costs requires genuinely exceptional circumstances. The threshold is high and must be assessed against the cases subject to the Part IIIA fixed-costs regime, rather than against all cases commenced within the relevant portal or protocol. A case does not become exceptional merely because it has unusually high value or costs, or because it has exited the protocol for a reason covered by the regime. Those matters may be relevant factors, but they are not determinative. Rules 45.29K and 45.29L do not lower the threshold. The appeal was allowed because the costs judge applied a low threshold and used the wrong comparison group.

The claimant suffered injuries in a road traffic accident. The claim was begun under the RTA pre-action protocol but later exited it and settled before proceedings for £42,000. The claimant sought costs exceeding the fixed recoverable costs under CPR 45.29J.

Master McCloud held that the circumstances were outside the general run of portal cases and permitted detailed assessment. The defendant appealed on the construction of the exceptionality test. The central issues were the correct threshold under rule 45.29J and the cases against which exceptionality had to be assessed.

1. Appeal allowed and matter remitted. The appeal was confined to the legal test under CPR 45.29J. The question whether the facts satisfied the properly construed test was remitted to the Senior Courts Costs Office for reconsideration by a different Master.
2. High threshold. The expression “exceptional circumstances” had to be read in the context of the comprehensive fixed-costs regime. The regime is intended to provide certainty and to accommodate ordinary variations through its “swings and roundabouts” approach. The threshold was therefore high. The Master erred by describing it as a low bar.
3. Correct comparison group. Exceptionality had to be assessed against cases which had exited the relevant protocol and were subject to CPR Part 45, section IIIA. It was wrong to compare the case generally with cases within the portal or protocol. Cases exiting under paragraphs 4.3 or 7.76 of the protocol formed part of the relevant basket and did not qualify merely because they were of that type.
4. Relevant factors. Value, costs and the circumstances of the case could be relevant, but none was determinative. The fact that a case had become more valuable or costly did not itself justify escape from fixed costs.
5. Rules 45.29K and 45.29L supplied costs consequences and safeguards after the rule 45.29J gateway had been passed. They did not alter the meaning of “exceptional circumstances” or justify a lower threshold. The court also rejected the suggestion that a precise causal link between the exceptional circumstances and increased costs was necessarily required.

• High Court (Queen's Bench Division): appeal from the order of Master McCloud, sitting as a Deputy Costs Judge, dated 25 May 2018. The legal test was held to have been misstated and the issue was remitted for fresh determination.