Court of Appeal case on the QOCS regime where claimant settles with some of the defendants

Under the Qualified One Way Costs Shifting (QOCS) regime, a claimant in a personal injury case can commence proceedings knowing that, if he/she is unsuccessful, he/she will not be obliged to pay the successful defendant's costs. There is a general exception under CPR r44.14, to the effect that a defendant can recover costs up to the amount of damages and interest received by the claimant (but if the claimant is unsuccessful, the defendant will recover nothing).

In this case, the claimant brought a personal injury claim against 4 defendants. He settled with 3 of the defendants, by means of a Tomlin order, and then discontinued the claim against the other defendant (D1). CPR r38.6 provides that a claimant who discontinues must pay the costs of the defendant against whom the claimant is discontinuing. D1 claimed that it was entitled to recover those costs from the sums paid by the other three defendants under the Tomlin order. It lost at first instance, and appealed to the Court of Appeal, which has now held as follows:

(1) A defendant can, in principle, take advantage of sums paid to the claimant by another defendant, in order to satisfy a costs order in its favour, pursuant to CPR r44.14.

(2) However, sums payable under a Tomlin order are not covered by the QOCS regime. CPr r44.14 applies to court orders in the claimant's favour but not settlements or Tomlin orders. Accordingly, D1 could not recover its costs in this case.