Qader & Ors v Esure Services Ltd & Ors

Factual and Procedural Background

These conjoined appeals concern the interpretation of the fixed costs regime applicable to claims initially started under the Road Traffic Accident (RTA) Protocol but subsequently allocated to the multi-track after issuance of Part 7 proceedings. The central question is whether the fixed costs regime continues to apply once a case leaves the RTA Protocol and is allocated to the multi-track. The RTA Protocol is designed as an efficient framework for resolving modest personal injury claims arising from road traffic accidents, primarily through an online portal and a three-stage process culminating in either settlement or judicial determination under Part 8. Cases may leave the Protocol due to liability disputes, revaluation of claims beyond the Protocol upper limit, or non-response by defendants, leading to Part 7 proceedings and allocation to the fast track or multi-track depending on case complexity and value.

Two representative cases are central to these appeals: In the first, claimants issued Part 7 proceedings after denial of liability and faced allocation to the multi-track due to allegations of deliberate collision fabrication. The trial judge applied the fixed costs regime despite multi-track allocation, a decision upheld on appeal but challenged further. In the second, a similar factual scenario involving allegations of collusion and fraud led to multi-track allocation and a decision to proceed on ordinary multi-track costs basis, which was also appealed. Both allocation decisions to the multi-track are not contested on appeal.

Legal Issues Presented

1. Does the fixed costs regime under section IIIA of CPR Part 45 continue to apply to claims started under the RTA Protocol that are subsequently allocated to the multi-track after Part 7 proceedings are issued?
2. Is there an obvious drafting error in section IIIA of CPR Part 45 that requires correction to exclude multi-track cases from the fixed costs regime?
3. What is the proper interpretation of the fixed costs regime in relation to the allocation of cases outside the RTA Protocol, particularly concerning multi-track allocation?

Arguments of the Parties

Appellant's Arguments (Claimants in First Case)

• The wording of Part 45.29A and B clearly applies the fixed costs regime to all cases started under the RTA Protocol, regardless of allocation to fast track or multi-track.
• The fixed costs regime provides certainty and predictability, avoiding disproportionate costs litigation.
• The safety valve under Part 45.29J for exceptional cases is intended to be applied at the end of proceedings, not at the allocation stage.
• Applying fixed costs to multi-track cases is consistent with the overriding objective and does not violate Article 6 of the Human Rights Convention.

Appellee's Arguments (Defendant Insurers in First Case and Defendant in Second Case)

• The fixed costs regime was intended only for fast track cases, not multi-track cases, as reflected in consultation documents and government responses.
• The allocation to the multi-track should disapply the fixed costs regime, permitting costs budgeting and management appropriate for complex multi-track cases.
• The inclusion of a damages upper limit in Table 6B Part A evidences a drafting error but does not undermine the overall scope of the fixed costs regime applying to all cases leaving the Protocol.
• Part 45.29J and similar provisions allow discretion to depart from fixed costs in exceptional cases, including those allocated to the multi-track.

Table of Precedents Cited

Court's Reasoning and Analysis

The court acknowledged that the ordinary language of section IIIA of CPR Part 45 clearly applies the fixed costs regime to all cases started under the RTA Protocol, regardless of allocation to fast track or multi-track. There is no express exclusion of multi-track cases, and the provisions, including Table 6B, reference allocation dates without limiting the track type. The court rejected arguments of conflict with other CPR provisions, noting that costs management rules for multi-track cases expressly exclude cases subject to fixed costs, implying that fixed costs may apply in some multi-track cases.

However, the court conducted a detailed review of the historical background and consultation process preceding the enactment of section IIIA. It found that the fixed costs scheme was designed specifically for fast track cases, based on Jackson LJ's Review of Civil Litigation Costs and subsequent government consultations which expressly intended to exclude multi-track cases from the fixed costs regime. The Rule Committee’s failure to exclude multi-track cases was identified as an inadvertent drafting error.

Invoking the court's exceptional interpretative jurisdiction as explained in Inco Europe Limited, the court concluded it was appropriate to correct this drafting mistake by reading into Part 45.29B an exclusion clause disapplying the fixed costs regime from the moment a case is allocated to the multi-track. This interpretation aligns with the legislative intent and avoids the unfairness of applying a fixed costs regime designed for fast track cases to complex multi-track litigation.

The court recognized the risk of satellite litigation at the allocation stage arising from this interpretation but emphasized that case management judges should manage such risks in accordance with the overriding objective. The court also noted an unresolved anomaly concerning the damages ceiling in Table 6B Part A, recommending the Rule Committee consider this issue but finding it unnecessary to resolve it in these appeals.

Accordingly, the court allowed the appeal in the first case, holding that allocation to the multi-track disapplies the fixed costs regime, and dismissed the appeal in the second case, affirming the application of ordinary multi-track costs management procedures.

Holding and Implications

The court's final decision is as follows:

The fixed costs regime under section IIIA of CPR Part 45 does not apply to cases started under the RTA Protocol once they are allocated to the multi-track.

Consequently, the fixed costs regime is automatically disapplied upon multi-track allocation without requiring recourse to the exceptional circumstances relief under Part 45.29J, which remains applicable only at the conclusion of proceedings. This interpretation corrects an inadvertent drafting error and aligns the fixed costs regime with its original legislative intent to apply only to fast track cases and certain limited procedures.

The direct effect is that cases leaving the RTA Protocol and allocated to the multi-track will be subject to ordinary costs management and assessment rules appropriate for complex litigation, rather than the fixed costs regime designed for less complex fast track claims. The ruling does not establish new precedent beyond the correction of the drafting error and does not affect the fixed costs regime's application to fast track cases or cases resolved under the Protocol.