James Pankhurst –v- Lee White & Motor Insurers Bureau [2010] EWCA Civ 1445

Posted on Wednesday, December 15th, 2010

C suffered catastrophic injuries on 7th June 2003 when struck by a vehicle driven by D1, an uninsured driver. After obtaining judgment on liability C entered into a CFA providing for a 22.5% success fee if the claim settled pre-trial and 100% if it concluded at trial. C made a Part 36 offer in May 2006. D made its offer on 28th May 2008. At trial C was awarded more than his own Part 36 offer but less than D’s. Consequently, he was ordered to pay D’s costs from 18th June 2008. C received his costs on the standard basis prior to his part 36 offer and on the indemnity basis thereafter. The judge declined to award interest on costs under CPR 36.14(c) because C had received £17,000 additional interest on damages and indemnity costs. C appealed on the ground that the judge was obliged to award interest on costs unless it was unjust to do so. He did not address that test. Jackson LJ found that C’s solicitors would recover a success fee in the region of £100,000, where there was effectively no risk. The adverse costs order would be paid by an ATE premium for which D was footing the Bill. C’s funding arrangements were grotesque. The Judge had reached the conclusion that it would be unjust to award interest on top of indemnity costs and there were no grounds for disturbing that conclusion.


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