Allan John Doyle v M&D Foundation & Building Services Limited

A consent order recording a negotiated costs agreement is construed objectively under contractual interpretation principles. The natural and ordinary meaning of subject to detailed assessment is the technical meaning given by the Civil Procedure Rules 1998: assessment under Part 47 on the standard basis, unless an indemnity basis is specified. It does not ordinarily mean assessment of fixed costs under Part 45. Parties may contract out of a fixed-costs regime. Context may show that words were used mistakenly or that their ordinary meaning should not apply, as in a settlement governed by internally inconsistent Part 36 machinery. A free-standing settlement between specialist solicitors, without such inconsistency, retains the ordinary meaning of the agreed wording.

The respondent suffered a workplace injury in a claim initially commenced under the Pre-Action Protocol for Low Value Personal Injury (Employers’ Liability and Public Liability) Claims. After the protocol ceased to apply, the claim was allocated to the fast track. The appellant made a Part 36 offer, which the respondent did not accept. Instead, the parties agreed a consent order providing for payment of £5,000 damages and costs subject to detailed assessment.

The District Judge assessed costs on the standard basis. Her Honour Judge Ingram dismissed the appellant’s first appeal. The central issue on the second appeal was whether the costs provision contracted out of the fixed recoverable costs regime or merely provided for determination of fixed costs and disbursements.

Lord Justice Phillips gave the leading judgment. Lord Justices Edis and Baker agreed. The appeal was dismissed.

1. Construction of the agreement. A consent order made administratively by agreement, without an accompanying judgment, is construed by identifying the objective meaning of the agreement it records. The court applies the contractual interpretation principles summarised in Pan Petroleum AJE Ltd v Yinka Folawiyo Petroleum Co Ltd [2017] EWCA Civ 1525, Sans Souci Ltd v VRL Services Ltd [2012] UKPC 6 and Wood v Capita Insurance Services Ltd [2017] UKSC 24.
2. Detailed assessment. Under rules 44.1, 44.3(4)(a) and 44.6 of the Civil Procedure Rules 1998, detailed assessment is a technical procedure under Part 47 and, unless another basis is specified, is on the standard basis. The rules distinguish that procedure from recovery of fixed costs under Part 45. The phrase subject to detailed assessment therefore does not ordinarily provide for an assessment of fixed costs.
3. Fixed costs. The fixed-costs regime is separate and substantially self-contained. It provides its own mechanisms for fixed costs, permitted disbursements, interim applications and exceptional claims exceeding fixed costs. The distinction between fixed and assessed costs recognised in Solomon v Cromwell Group plc [2011] EWCA Civ 1584, Broadhurst v Tan [2016] EWCA Civ 94 and Sharp v Leeds City Council [2017] EWCA Civ 33 supported that conclusion.
4. Application. The agreement was a free-standing settlement negotiated by specialist solicitors. It was not the acceptance of a Part 36 offer and contained no internal inconsistency or other indication that the parties had used the wrong terminology. Adelekun v Ho [2019] EWCA Civ 1988 was distinguishable because the wording there had to be read within the restrictive Part 36 mechanism. The court would not speculate about the parties’ commercial motivations or rewrite their agreement. The order therefore required standard-basis detailed assessment, and the appeal was dismissed.

• Court of Appeal (Civil Division) dismissed the second appeal.
• County Court at Sheffield dismissed the appellant’s appeal from the costs assessment.
• County Court at Doncaster assessed the respondent’s costs on the standard basis at £14,467.44, with interest to be agreed.