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Qualified One Way Costs Shifting

Jasmeet Sra, Costs Lawyer

Jasmeet Sra, Costs Lawyer

 

We are frequently asked about Qualified One Way Costs Shifting (QOCS) and its effect in both principle and practice.

Recently, the Court of Appeal addressed QOCS in Wagenaar -v- Weekend Travel Ltd [2014] EWCA Civ 1105.

This was a personal injury case involving an accident abroad and he Claimant’s case was dismissed at trial (as was the Defendant’s case against a third party). The trial judge ordered that QOCS apply in both instances, i.e. the Claimant pay the Defendant’s costs and the Defendant pay the third party’s costs. However, neither was enforced pursuant to the provisions of CPR 44.13 and 44.14. pursuant to CPR 44.13 and 44.14.

 There were four issues for the Court of Appeal to determine.

1. Were the QOCS provisions in the CPR ultra vires?

– No. The court was mindful of the provisions being part of the wider ‘Jackson reforms’.

 2. Was it appropriate to make the QOCS provisions retrospective?

– The Defendant’s argument that applying QOCS retrospectively was both prejudicial and unfair. The court sympathised as if trial had taken place two months earlier QOCS would not have been in place but was clear in that these were the consequences of procedural reform, and i) there had to be a cut-off date, ii) some parties would unfortunately be on the cusp of reform

3. Was the Defendant’s junior counsel’s CFA still effective in a QOCS case?

– There is only one specific transitional provision in Part 44.17, which provides that the regime does not apply to proceedings where the Claimant has entered into a pre-commencement funding arrangement. As such, the pre April 2013 Counsel between the Defendant and junior Counsel did not affect the application of QOCS.

 4. Did the QOCS provisions apply to a claims by a Defendant against a third party?

– The court decided that CPR Rule 44.13 does not apply QOCS to the entire action in which any such claim for damages for personal injuries or the other claims specified in CPR Rule 44.13(1)(b) and (c) is made. QOCS did not apply between the Defendant and third party.

 Commentary

The decisions on issues 1 & 2 are largely uncontroversial. Issues 3 & 4 may result in Defendants reconsidering the manner in which they apply to join third parties and the timing of such applications.