Qualified One-Way Cost Shifting (QOCS) rule was introduced for Personal Injury Claims on 1st April 2013 following its recommendation by Lord Justice Jackson. The rule meant that Defendants would normally be ordered by Court to pay the costs of successful Claimants but, subject to certain exceptions, would not be able to recover their own costs if they successfully defended their claim as per CPR 44.14(1). In these situations, the Defendant would have only been able to recover these costs if they obtained permission from the Court. This rule in its current state therefore limits the liability for the Claimant in relation to the Defendant’s costs in a PI claim.
However after recent consideration by Parliament, it was decided that any cases issued on or after 6th April 2023 will see a Defendant being able to enforce costs up to “the aggregate amount in money terms of any orders for or agreements to pay or settle a claim for, damages, costs and interest” as the Ministry of Justice writes. Simply put, where there is an order for costs for both the Claimant and the Defendant, the Defendant will be able to enforce its costs against damages, interest and the Claimant’s costs without permission from the Court after the conclusion of proceedings if they can successfully defend the claim.
The change to the QOCS rule will be updated to cover deemed costs orders and agreements to pay damages. This means that acceptance of Part 36 offers and Tomlin Orders will now be recognised under the QOCs rules and importantly where a claim settles under these types of agreements then a Defendant will be able to enforce its costs against damages, interest and any Claimant costs.
Furthermore from a claimant’s perspective, this change may likely see their funding mechanisms such as After The Event insurance (ATE) premiums rise and the criteria set by the insurance providers change in order to cover the enhanced risk. For that reason, it seems that this change will have a detrimental effect on access to justice for every type of claimant.
Ultimately, QOCS (unless there is a finding of fundamental dishonesty on behalf of the Claimant) can still be applied but whilst a Claimant may potentially be ‘successful’ with their claim, they would simply not see any benefit as their damages/costs would be extinguished by the offsetting of the defendants costs. The Defendants costs however are capped at the level of the Claimant’s costs and damages and are not able to exceed those combined sums.
Claimant’s solicitors will be relieved to note that this change cannot be applied retrospectively and so they will need to think carefully about whether they should issue their client’s case before 6th April 2023.
QOCS is a difficult area of law to understand and may be one that is further updated again in the future given the aforementioned risks involved in bringing a claim after 6th April 2023, however if you or someone you know needs any advice on a claim please contact info@ramsdens.co.uk or calling us on 01484 821 500.