BNM Under-fire Again

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Posted on: January 31st, 2017 by Brett Anderson

In the excellent judgment of Master Brown in the case of Murrells v Cambridge University NHS Foundation Trust 2017, for a second-time Master Gordon-Saker’s approach in BNM has been “respectfully” disagreed with.  In another clinical-negligence case where additional liabilities were claimed from the paying party; the finding of Master Brown was that the ATE and success fee allowed on assessment should not be aggregated to the base costs when considering proportionality of costs. Therefore, when considering if the assessed costs were proportionate, there was no allowance made for the extent of the additional liabilities.

He reasoned that this was correct as the rules under CPR 48.1 were not intended to bring in sweeping changes as to the recoverability of additional liabilities. He drew this conclusion on considering the landscape in which the new rules were drafted and the effects of aggregating the additional liabilities with the base costs. Master Brown averred that aggregation as proposed by the Defendant could render additional liabilities substantially or event totally irrecoverable. Therefore, Master Brown asked himself if it was the intention of the legislature to cause this substantial change.

On review of the approach pre-Jackson and on considering cases such as Attack v Lee and Rogers v Merthyr Tydfil Borough Council it was clear that the test of proportionality of additional liability is whether they are proportionate to the risk to which they pertain. This of course was a significantly different approach to that applied in BNM and advocated for by the Paying Party in this case where the additional liabilities were considered as to whether they were proportionate to the factors identified in CPR 44.3(5). Master Brown also considered Coventry v Lawrence and he concluded that if there was irrecoverability of additional liabilities then this would result in a fundamentally reduction in access to Justice.

Master Brown concluded that the legislature did not intend to move so dramatically away from the approach in assessing additional liabilities and, if they had, it would have been expressed more clearly. Having made this ruling he considered the extent to which the old Costs Practice Direction could be incorporated into a current costs assessment where there was a pre-commencement funding arrangement. Whereas in BNM Master Gordon-Saker took a strict interpretation and concluded that only those aspects of the Costs Practice Direction which directly related to a pre-commencing funding arrangement were to be considered, Master Brown took an alternative view. He concluded that as it was intended that the assessment of additional liabilities was not intended to be substantially changed under the new rules and therefore it was correct to interpret the meaning of CPR 48.1 to incorporate the wider elements of the old Costs Practice Direction which impact on cases funded by a Pre-commencement funding arrangement. Therefore, by virtue of CPR 48.1 paragraph 11.9 of the old Costs Practice Direction was to be applied in the assessment which meant that the base costs and additional liabilities will be assessed separately in relation to proportionality.

I believe this case, along with King v Basildon and Thurrock NHS Trust indicate a clear direction of travel. To have two SCCO Masters going against the judgment of Master Gordon-Saker is a clear indication that the approach he adopted will be found to be wrong on the appeal of BNM, We have already used these cases to successfully and favourably settle an appeal action which relied on BNM in the initial judgment. I wonder how confident the lawyers responding to the BNM appeal are feeling?

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