Abbott v Long 20.05.11

Court of Appeal upholds decision that there should be no order for costs in £48,000 credit hire claim. A collision occurred between the Claimant’s and Defendant’s cars at a junction. The Claimant was successful at trial, with a 75 percent reduction for contributory negligence. The Claimant’s car was written off in the accident. He made a credit hire claim for £48,000 for a period of hire from the accident in June 2008 until December 2009. During the trial at first instance before Her Honour Judge Marshall, the Claimant accepted that he would have been able to finance a substitute vehicle and the Judge reduced the claim for recovery of the hire charges to six months. The credit hire expenses recovered were only £8,600. The Judge made no order as to costs, taking into account:

  1. There had to be a trial because there was no offer.
  2. The conduct of the Claimant had failed to show proper regard for the duty to mitigate.
  3. The Defendant had had a significant measure of success on liability and quantum.

Held

Lady Justice Arden held that the starting point was CPR 44.3, which gives courts discretion in relation to costs. To succeed in the appeal, the Claimant would have to show that in making her decision, HHJ Marshall had erred in principle or was perverse. The kernel of the Judge’s point was that the Claimant’s “grossly exaggerated” conduct had been driven by the approach of the hire company. Whilst not the same as dishonesty, such conduct is still blameworthy. The courts have jurisdiction to deprive a party of costs on the grounds of misconduct – see for example the Court of Appeal’s judgment in Widlake v BAA. The judgment of HHJ Marshall was carefully reasoned and there was no basis for saying that it was disproportionate.

Comment

Defendants and insurers will welcome this decision which draws attention to the need for credit hire companies to carry out proper reviews to ensure that claims are being properly pursued. In this case, there was a difference of nearly £40,000 between the level of hire costs claimed and that deemed to be recoverable.

The decision demonstrates that, when seeking to reduce credit hire claims, arguments on mitigation are key. The conduct of the credit hire company must be considered in addition to the claimant's conduct.

The case also confirms the level of discretion courts have in relation to costs. Just because a party has been successful, it does not necessarily follow that he will be able to recover his costs, in particular where misconduct can be shown.