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Ben Petrecz

Ben Petrecz

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Costs complexity

Blogs25/06/2019

Complexity and Exceptionality

In most walks of life, complexity and exceptionality are not difficult to identify or comprehend. Few would disagree that Cristiano Ronaldo is an exceptional footballer, or Ed Sheeran an exceptional musician. Most of us would happily concede that the science and mathematics underpinning aerodynamics and space travel is far too complex for our humble brains to grasp. But what of complexity and exceptionality in the context of legal claims?

Irrespective of whether these issues arise in low value portal claims or higher value multi track cases, these subjects regularly trouble litigators.

A common argument raised by those looking to escape prescribed costs in the early days of the Fixed Recoverable RTA regime was: (i) the amount of work required to successfully conclude the claim was significantly higher than the prescribed fees thus evidencing the matter was complex; (ii) the claim was therefore “exceptional” and not the kind envisaged by the regime so “hourly rate costs” should be recovered.

The judiciary were quick to reject such argument on grounds that the amount of work required to resolve a claim was not a determinative factor, rather there had to be a particular feature (or features) relating to the claim itself to have it considered exceptional. Throughout the years, the courts have regularly handed down judgments reiterating that any fixed costs regime is predicated on a “swings and roundabouts” approach. It may over-reward in some instances and under-reward in others, but when viewed as a whole, it is generally fair and reasonable.

There have been a couple of recent decisions which help further our understanding of complexity and exceptionality.

In the context of proportionality, HHJ Dight CBE had this to say in Barts Health NHS Trust v Salmon:

It seems to me that, when one is looking at complexity of the litigation, it has to be looked at in the context not of the particular category of litigation which it forms part of, but of the overall work of the court, where it is one of the cases which is being dealt with. Undoubtedly, this was not a complex clinical negligence case, but it was, in the great scheme of things, more complicated than much of the usual work of the County Court, and, in my judgment, 44.3(5)(c) requires one to look not only at the niche area in which the work falls, but at all the circumstances including the general run of work which the court handles. It is, of course, only one of the factors which can render the overall relationship between the costs and the factors reasonable or not.

In so far as identifying what makes a claim “exceptional” or satisfying the test of “exceptional circumstances”, Mr Justice Stewart wrestled with some of the principles and historic case law in his recent judgment in Ferri v Gill:

  • An expression such as “exceptional circumstances” must take its colour from the setting in which it appears. (R v Soneji)
  • We must construe "exceptional" as an ordinary, familiar English adjective, and not as a term of art. (R v Kelly)
  • A test requiring “exceptional circumstances” is already a high one... If it is not out of the norm, it certainly cannot be exceptional. (Hislop v Perde)
  • The ultimate question in any such “exceptional” case is whether in all the circumstances it is just to make the order….. (Dymocks v Franchise Systems v Todd)

It seems the take-home messages from these two recent decisions are: when looking at complexity or exceptionality in a legal context, one must: (a) understand that complexity and exceptionality are judged against the background and settings in which they appear; (b) look at the individual facts of a case within the context of other such similar claims; (c) look at the generality of those claims within the spectrum of cases that are envisaged by the rules governing them and / or by the court dealing with them.

As with most questions and disputes that arise in law, the individual facts are often the key to arriving at the answers. Keoghs are here to assist with that analysis and process.

For more information, please contact Benjamin T Petrecz, Costs Lawyer and Associate