In Shaw v Medtronic  EWHC 1397 (QB), the Court of Appeal found that the claimant had not abused the Court process by filing a notice of discontinuance against the fifth defendant to benefit from the protection of qualified one-way costs shifting (QOCS).
The parties agreed that section 2 of CPR 44 applied, and in particular CPR 44.14(1) which states subject to rules 44.15 and 44.16, orders for costs made against a claimant may be enforced without the permission of the court but only to the extent that the aggregate amount in money terms of such orders does not exceed the aggregate amount in money terms of any orders for damages and interest made in favour of the claimant.
In this particular case, the claimant had not received any award for damages or interest, and therefore the rule would in effect mean that no costs order could be enforced against them.
During the main claim, the fifth defendant had filed an acknowledgement of service on 11 October 2016, and on 17 October 2106, they had written to the claimant’s solicitor to highlight the weaknesses of the claim. This prompted a response from the claimant’s solicitor which stated that they were not prepared to file, at that stage, a notice of discontinuance. The fifth defendant therefore, on 25 October 2016, filed an application to strike out the claim. If the fifth defendant were successful it would “bring the fifth defendant within the scope of the exception in CPR 44.15(a) to the general rule concerning qualified one-way costs shifting”.
CPR 44.15 (a) states that Orders for costs made against the claimant may be enforced to the full extent of such orders without the permission of the court where the proceedings have been struck out on the grounds that –
(a) the claimant has disclosed no reasonable grounds for bringing the proceedings;
The first judgment was given on 20 January 2017, and the claimant proceeded to file a notice of discontinuance on the fifth defendant in March 2017, before the fifth defendant’s application could be heard.
The fifth defendant attempted to persuade Mr Justice Lavender to utilise his powers under CPR 38.4 and set aside the notice of discontinuance on the basis it was an abuse of the process of the Court. However, Mr Justice Lavender found that whilst it was striking that the claimant has opted to discontinue against the fifth defendant whilst maintaining claims against the first, third and fourth defendants (through the Court of Appeal), that it may be that the claimant had realised, albeit later than they may have done, that the prospects of success in their claim against the fifth defendant were not favourable. Justice Lavender found that “it does not, in those circumstances, strike me that this is a case of abuse of process of anything sufficient to justify setting aside the notice of discontinuance”.
The fifth defendant was refused permission to appeal on the basis the decision was made on the facts of the case.
Therefore, as a litigator, the power of QOCS should always be borne in mind, particularly if the case being brought by a claimant is for non-monetary award. The filing of a notice of discontinuance is a powerful tool for claimants to have as their exposure to adverse costs would be nil. As a defendant, you should always be on the lookout for any aspects of the case which may kick into effect CPR 44.15 in order to escape the parameters of QOCS.
If you have any questions or queries in relation this blog please contact Joanne Chase (firstname.lastname@example.org and 0113 336 3327) or the Clarion Costs Team on 0113 2460622.