By Legal Futures Associate Temple Legal
The Ho v Adelekun hearing at the Supreme Court has taken place and the decision has finally been handed down. This judgment has resulted in a major claimant victory. It reverses the decision in Howe v MIB and reinforces the original intention of the QOCS regime; this being that, in cases where a Part 36 offer has been accepted out of time or unbeaten at trial, the defendants right to recover their costs is capped at the value of the damages that they pay to the claimant.
It was agreed previously between the parties that Ho be awarded the costs of her successful appeal, reported to be £48,600. The crux of the matter was whether she was able set off her costs entitlement against her liability for Adelekun’s £16,700 costs of the claim.
Previously in April 2020 the Court of Appeal had decided that, but for it being bound by the prior decision in Howe v Motor Insurers’ Bureau (heard 29-30th June, announced 6th July 2017), it would have agreed that a defendant should be able to recover costs awarded, but only by set-off against damages and interest; the claimant’s liability should not extend further to consume their pre-offer costs.
In recent years defendants in personal injury and clinical negligence matters have relied on the case of Howe v Motor Insurer Bureau [2017] EWCA Civ 932, to recover greater costs after successfully defending a Part 36 Offer. In this case, Lord Briggs and Lady Rose considered that the Court of Appeal was right to doubt whether Howe was correctly decided.
Commenting on the decision, Matthew Best, Senior Underwriting Manager at Temple Legal Protection said ‘We have always maintained that the intention of the Jackson reforms was only ever to allow limited cost shifting relating to damages and not pre-offer costs. We have protected our policyholders interests by providing continued indemnity during this period of uncertainty and welcome this decision. It is one which will help us maintain access to affordable, high quality ATE insurance cover.
