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Consequences of QOCs provisions under CPR 44.16(2)(B)

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The Judgment handed down by the High Court in Siddiqui v University of Oxford [2018] EWHC 184, concluded that an extent of the claim being pursued was not in relation to a personal injury claim but instead a ‘pure financial loss’ claim based upon breach of contract and/or negligence, and the Claimant was therefore not entirely protected by Qualified One Way Costs Shifting (‘QOCS’). The Court subsequently ordered the Claimant to pay 25% of the Defendant’s costs.

Background of the claim

Mr Faiz Siddiqui (“the Claimant”), an Oxford graduate, sought damages against Oxford University claiming that the astounding and negligent teaching provided ultimately cost him a first-class degree and prevented him from having a successful career as an international commercial lawyer. The Claimant also argued that his personal tutor failed to inform the relevant authorities of the difficulties encountered during his examination period due to severe hay fever, insomnia, anxiety and depression, which could have resulted in reasonable adjustments being made to his marks.

The University argued that the claim should be struck out in light of the amount of years that had passed since the Claimant graduated but this application was rejected in December 2016.

The claim failed and the matter of costs was subsequently considered by the Court.

Costs Judgment

Whilst the parties agreed that the Defendant was entitled to a costs order in its favour, disagreements were faced in relation to the enforceability of such an order. The main issue was whether there should be an exception to the general QOCS rules (namely, that a Claimant is protected from an adverse costs order in the event that his claim fails) applied in this case. Whilst the Claimant maintained that an adverse costs order should not be enforced due to the claim being a personal injury claim as pleaded from the outset. The Defendant submitted that the costs order should be enforceable pursuant to CPR r.44.16(2)(b), even if only to an extent.

The Defendant accepted that a claim for damages for personal injuries was included within the claim. However, they further stated that the claim further included claims in contract and tort for "straight financial loss as a result of alleged negligence" .Under CPR r.44.16 (2)(b), this would mean that a claim other than a claim for damages for personal injury was made for the benefit of the Claimant and would fundamentally be an exception to QOCS.

The Defendant’s argument relied upon the fact that an extent of the Claimant’s pleadings stated that the low level of the Claimant’s degree had led him to not being able to secure a place in a US Law School consequently affecting the potential for a successful career path. These pleadings were related to an economic loss unrelated to the Claimant’s psychiatric injury inflicted by the unexpected low grade. On this basis, the question remained whether CPR 44.16(2)(b) would apply and ultimately allow the Court to disapply the QOCS provisions to the part of the claim that did not include a claim for damages for personal injuries.

Having considered Morris J’s detailed comments in Jeffreys v The Comissioner of Police for the Metropolis [2017] regarding the rules surrounding QOCS provisions the Judge commented that arguably this case did fall within the exception provided by CPR 44.16(2)(b) in the sense that both claims regardless of the breach of duty being essentially the same  were still two different types of loss and should therefore be considered as such. A question therefore remained as to how the discretion afforded by such provision should be exercised without unreasonably striping the Claimant off the benefits and protection provided by QOCS. In this matter, a broad brush approach was taken and the Claimant was therefore ordered to pay the Defendant 25% of its costs to be subject to a detailed assessment on the standard basis if not agreed.

Commentary

Cases such as the above, subject to the QOCS regime are now reaching the Courts and raising the issue regarding the provisions; introduced to counterbalance the change to recoverability of ATE insurance. Whilst the objectives of the QOCS provisions are clear and caution surrounding any potential exceptions is expected, it is clear that a contrast must be made between different types of claims. The simple fact that a contract and/or negligence claim may have been embellished within a personal injury claim does not necessarily mean that an unsuccessful Claimant will automatically avoid the consequences of failure in litigation. As a matter of fact this may mean the opposite and ultimately lead to further non recoverable costs being incurred.

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