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In-growing toe-nails Mathematical Errors and Opportunist Defendants

9th April 2014

I wrote this article more than a year ago, but it is worth repeating here, as it shows how we at Berlad Graham take no nonsense from Defendant costs negotiators.

It turns out Mum was right. I would one day regret failing to cut my toe nails straight. I'm not entirely sure she envisaged them starring in a witness statement in the Sheffield County Court or being at the centre of a costs dispute with a major insurance company. If she did have an inkling of precisely the trouble they would cause, I am pretty certain she would have insisted on nail clippers from day one.....and perhaps a career dealing with something more sensible than legal costs.

On 7th September 2012 I had the toe nails of each big toe removed. In hindsight, it was a mistake. In growing toe nails cause infrequent and moderate pain. Avoiding impromptu football matches, dropping things on them and being trodden on by heavy people by and large reduces it to a tolerable and manageable inconvenience Removal of toe nails, despite the chiropodist's assurances to the contrary, turns out to cause constant and excruciating physical pain for weeks on end as well as the emotional trauma of having to wear sandals in the autumn. I would liken the physical pain, without even a hint of hyperbole or melodrama, to having a rabid rat gnawing at the end of your toes until the end of time. As for the emotional pain of having to wear sandals with socks, need I say more?

In March 2012 I had embarked, rat free and still in possession of a sense of fashion, on the recovery of costs for one of my clients who had successfully represented a Claimant in a personal injuries claim, resulting in the Defendant's insurers, Axa, paying the sum of £10,000 in damages to the Claimant and agreeing to pay his reasonable costs. My clients tried to deal with matters themselves but, having presented a fairly sensible schedule of costs amounting to just over £11,000 to the insurers, realised on being told that the matter was being referred to "specialist costs negotiators" that they were probably now in it for the long haul. The opening offer was for just over £4,400. Is that a typo you ask? No, they really do purport to be specialists.

Anyway we had a few exchanges of opinion, as a result of which the negotiators made a slight increase from £4,400 with a final offer of £7,150, which they then increased to a final offer of £7,500. We told them this was still too low, they disagreed, we served a formal bill for just under £10,800 and offered to accept £9,000 under part 47.19.

So, the battle lines were drawn and the matter was listed for an assessment hearing on 28th September. Three weeks post toe nails. No problem. I would skip into Court.

Anyway, as it happened, 28th September was the very first day that I had tried to squeeze a pair of traditional leather shoes onto my still swollen, bleeding and not entirely aesthetic feet. The gnawing rat was subdued briefly by some heavy duty pain killers, but reawakened on arriving at Court, keen to become as involved as it could in the judicial process.

The hearing proceeded with the District Judge making decisions on the majority of the points in dispute, leaving the parties to agree between themselves just a few points on routine communications. Most of the decisions had gone my way. Both my opponent and I thought I had won. The rat was enthralled. So in the entirely ordinary way adopted since time immemorial the District Judge adjourned briefly so that we could go away and calculate the effect of his various decisions, tie up the final points on communications and come up with a final figure.

It was at this point that either the rat started to gnaw at more than just my toes, or the pain killers really kicked in in earnest. I made the most basic mathematical error, missing out both a chunk of nearly 4 hours of time, and £200 of VAT on disbursements. The net result was that.......shock/horror....... I had not beaten the Defendant's offer. The Defendant's representative apparently made exactly the same two errors, and agreed my calculation.. Despite much head scratching, I could not work out for the life of me where things had gone so badly wrong, and had to concede that we had lost and would have to pay the Defendant's costs of assessment.

So back in before the District Judge we went to report the outcome. After deducting the Defendant's costs of assessment, my clients were left with less than £2,000. I was left with sore feet and the suspicion that after 25 years I was perhaps no longer suited to the world of costs.

Something continued to gnaw at me though, and not just the rat, I could not see how I had got the initial calculations so wrong, or the part 47.19 offer so far off the mark. So on the Saturday morning a quick recalculation (this time in sandals, which is perhaps the key) demonstrated penny for penny precisely the two mistakes that had been made. I had in fact won. The real total was just over £8,100 and, adding in the cost of preparing the bill increased to just over £8,800. Both were above the Defendant's offer, the full figure was refreshingly close to my part 47.19 offer of £9,000. I had still got it. I could still strut my costs stuff. There had been a mutual mistake in reporting back to the Court. My clients were entitled to the real figure, along with their costs of assessment, and all was right with the world. The Defendants would not object. It would be ungentlemanly. They could not object. They would have no grounds.

So, it will come as no surprise to any claimant solicitor to hear that on the Monday morning I was informed by the Defendant's Solicitor that, although he accepted that there had been an error he/they considered me bound by the result -

"I’m going to have to maintain that there is a binding agreement between the parties in relation to the figure agreed for costs and disbursements and, as I see it, the only basis to go behind the agreement is if there was an obvious mistake"

Two facts appeared to pass the Defendant by. There was no "agreement" in the sense of a compromise to dispose of the proceedings without the risk of a judicial determination. We were working out the effect of the District Judge's decisions on detailed assessment. Secondly, the mistake was pretty obvious!

Anyway, two and a half weeks down the line, an application to vary the order and a further £1,000 of legal costs later, the Court found wholly in our favour and expressed astonishment that the Defendant ran this argument. An application for permission for appeal was dismissed as being "absolutely without merit". The Defendant's solicitor was of course acting entirely on instructions (presumably without having advised them), and described his clients as having tried to grab a windfall or words to that effect. Staggering.

The net result in so far as Axa is concerned is that in a case that could have settled long ago for £9,000 inclusive, they have ended up paying more than £14,000 once costs of assessment, costs of the application and interest are taken into account. Presumably they also have to pay their negotiators and solicitors (although one does wonder whether Axa might have a potentially much more lucrative punt on a Solicitors Act assessment or two). At best £5,000 has been wasted arguing about costs.

I wonder if those who have expressed concern about the escalation of the "cost of costs" and blamed greedy Claimant personal injury solicitors have actually been looking in the wrong place all this time?

Anyway, the moral of this story: never trust a chiropodist or a costs specialist, and always wear sandals to do your maths!

please contact Mark

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