COST BITES 220: QOCS PROTECTION DOES NOT APPLY TO CO-CLAIMANTS WHO DO NOT BRING A CLAIM FOR PERSONAL INJURY: NOR DOES IT APPLY WHEN A CASE IS STRUCK OUT

In BB & Ors v Khayyat & Ors [2025] EWHC 443 (KB) Mr Justice Soole rejected an argument that claimants who had not brought an action for personal injury could have the benefit of QOCS protection.  The fact that they were co-claimants in an action where other claimants had brought an injury claim did not mean that  they gained QOCS. Further the actions of those claimants who did bring a claim for injury had been struck out.  The striking out meant that those claimants also did not have QOCS protection.

“There is no principled basis for a claimant who makes no claim for damages for personal injuries to enjoy QOCS protection merely because he has joined in proceedings with other claimants who do make such claims.”

THE CASE

A number of claimants brought an action against the defendants alleging that they were liable because they had allegedly financed or facilitated the payment of funds to a jihadist terrorist group.  The claims by some of the claimants (who brought an action for personal injury) were earlier struck out on the basis they were an abuse of process. The remaining claimants (who did not bring a claim for personal injury) discontinued their action. The “discontinuing claimants” sought an order that they would not face the normal costs order on discontinuance.  The discontinuing claimants’ application was rejected at an earlier hearing and they were liable to pay the costs.

THE DISCONTINUING CLAIMANTS OBJECTION TO AN INTERIM PAYMENT OF COSTS

The discontinuing claimants argued that no interim payments should be made because the court had a discretion not to enforce the costs order against them. This was an issue that should be considered after detailed assessment.

1. The Discontinuing Claimants oppose orders for interim payments on two essential bases. First, that the Court has a discretion to grant them QOCS (Qualified One-Way Costs Shifting) protection against enforcement of costs orders, pursuant to CPR 44.16(2)(b); and that the exercise of such discretion should be considered only after the completion of detailed assessment and should not be compromised by orders for interim payments (‘the QOCS issue’). Secondly, that in respect of the Bank’s costs of the Jurisdiction Application and the request for an interim payment, a contractual Undertaking given by McCue Jury in that sum has lapsed and the monies should be released (‘the Undertaking issue’).

THE JUDGMENT ON THIS ISSUE

The judge did accept this argument. The discontinuing claimants did not bring an action for personal injury. The fact that some of the claimants had brought such an action did not mean that the non-personal injury claimants could argue they could have QOCS protection.

1. 1. In my judgment this argument is in conflict with clear decisions of the Court of Appeal including Brown; and receives no support from Achille nor from the observations of Swift J in the present proceedings. In short, these authorities show that in every case where QOCS protection falls for consideration, the exclusive focus is on the claim or claims of the particular claimant within the proceedings. If the claim(s) of the individual claimant in question do not include a claim for damages for personal injuries, there is no QOCS protection.

1. 1. Thus in Wagenaar v. Weekend Travel Ltd [2014] EWCA Civ 1105; [2015] 1 WLR 1968, Vos LJ stated at [38]: ‘The whole thrust of CPR rr. 44.13 to 44.16 is that they concern claimants who are themselves making a claim for damages for personal injuries…‘ He continued: [39] ‘It is true, however, that the word “proceedings” in CPR r 44.13 is a wide word which could, in theory, include the entire umbrella of the litigation in which commercial parties dispute responsibility for the payment of personal injury damages. I do not think that would be an appropriate construction. Instead, I think the word “proceedings” in CPR r 44.13 was used because the QOCS regime is intended to catch claims for damages for personal injuries, where other claims are made in addition by the same claimant. There may, for example, in the ordinary road traffic claim, be claims for damaged property in addition to the claim for personal injury damages, and the draftsman would plainly not have wished to allow such additional matters to take the claim outside the QOCS regime. [40] Thus, in my judgment, CPR r 44.13 is applying QOCS to a single claim against a defendant or defendants, which includes a claim for damages for personal injuries or the other claims specified in CPR r 44.13(1)(b) and (c), but may also have other claims brought by the same claimant within that single claim. Argument has not been addressed to the question of whether QOCS should apply to a subsidiary claim for damages not including damages for personal injuries made by such a claimant against another defendant in the same action as the personal injury claim. I would prefer to leave that question to a case in which it arises. CPR r 44.13 is not applying QOCS to the entire action in which any such claim for damages for personal injuries or the other claims specified in CPR r 44.13(1)(b) and (c) is made.‘

1. 1. Brown at [19] cited these paragraphs from Wagenaar. Then at [36] Coulson LJ stated: ‘It is clear that rule 44.13 was widely drawn so as to refer to all proceedings in which there might be a claim for damages for personal injury. Ms Darwin correctly called that “a broad gateway”. But the exception at rule 44.16(2)(b) is more specific. It does not refer to proceedings. It simply refers to “a claim…other than a claim to which this Section applies”. The narrower words of the exception demonstrate that what the CPR intended was to exempt from the QOCS regime, within the widest possible umbrella of the proceedings as a whole, claims which were not claims for damages for personal injury.’

1. 1. The further passages in Brown at [55]-[58] provide no support for the argument now advanced. The Court is simply making clear that it will be a ‘mixed claim’ where the claimant in question is claiming both damages for personal injury (including the financial consequences thereof) and damages for loss which are consequent upon the incident but not the injury.

1. 1. True it is that the cases of Wagenaar and Brown concern proceedings with just one claimant; but the principles apply with equal force to proceedings which have multiple claimants. There is no principled basis for a claimant who makes no claim for damages for personal injuries to enjoy QOCS protection merely because he has joined in proceedings with other claimants who do make such claims. To take a simple example, where a negligent driver collides with another car. The owner-driver of that car is uninjured but his car is damaged. However his passenger is injured. Since each claim arises from the common collision, both claims are for convenience brought within the same Claim Form. There is no basis for the owner-driver to enjoy QOCS protection in respect of his claim, merely because his co-claimant has a claim in those proceedings for personal injury; nor for him thereby to be in a better position than if the two had issued separate Claim Forms.

1. 1. The argument also gains no support from Achille. In that case, the ‘proceedings’ in CPR 44.15 was interpreted to include all the claims brought by the claimant in the action. The result would have been no different if Mr Achille had been just one of a number of claimants in the same action. For the purpose of QOCS protection the exclusive focus is on the particular claimant in question.

1. 1. As to the observation of Swift J at [3] (‘It is accepted that..‘), this evidently reflects the common position of the parties at that time, rather than a decision following argument. The hearing took place before the split between two groups of Claimants occurred; and without any request for consideration of the individual position of each Claimant within the group.

1. 1. I turn to the pleaded claims in these proceedings. The Re-Amended Particulars of Claim in respect of each of the Continuing Claimants include claims for personal injury, physical and/or psychiatric: see paragraphs [10]-[19] and [23]-[25]. By contrast, the relevant paragraphs in respect of the Discontinuing Claimants read: ‘[21] In 2012 members of the al-Nusra Front attacked, looted and destroyed the Fourth and Sixth Claimants’ business and the valuable property they owned in Deir-ez-Zor. The Fourth, Fifth, Sixth and Seventh Claimants and their families were thereafter forced to flee Syria permanently because of the severe threat to their lives posed by the al-Nusra Front. [22] As a result of their treatment by the al-Nusra Front, the Fourth, Fifth, Sixth and Seventh Claimants have been permanently deprived of all of their property and livelihoods in Syria and had been forcibly displaced from the country of their home and nationality. Further details concerning the Fourth, Fifth, Sixth and Seventh Claimants’ claims are set out at paragraphs 36 to 45 in the Confidential Schedule.’

1. 1. I have been provided with the Confidential Schedule. It was not suggested that these contain any allegations of personal injury, whether physical or psychiatric. They do not.

1. 1. Nor do I accept that anything in the pleaded case, including the Confidential Schedule, provides any basis to infer or imply that any of these Discontinuing Claimant must have suffered physical or psychiatric injury as a result of the pleaded events and/or therefore are to be treated as if they were making claims for damages for personal injury.

1. Accordingly there is no basis for the Discontinuing Claimants to have QOCS protection, whether under CPR 44.16(2)(b) or otherwise; nor therefore any reason to defer any of the outstanding costs issues on the basis that the discretion under that rule may fall to be exercised.

THE “CONTINUING CLAIMANTS”

The action of those people who had brought a claim for personal injury damages had earlier been struck out as an abuse of process. This meant that they did not have QOCS protection.

1. 1. By my Order dated 1 July 2024 which struck out the claims of the Continuing Claimants, it was ordered that they should pay the Bank’s costs of the Strike Out Application, for detailed assessment on the standard basis if not agreed. The remainder of the Strike Out Application as related to consequential costs orders was adjourned to be heard with the Discontinuing Costs Application and the Wasted Costs Application. By paragraph 9 of that Order, those applications were to be listed for hearing before me in what became the hearing of 28 and 29 November 2024 and 3 February 2025. In the event, I considered it necessary to defer the Wasted Costs Application until the party and party costs issues had been determined; and there was no time to deal with the remaining costs issues against the Continuing Claimants….

1. 1. The Continuing Claimants’ claims having been struck out by my Order dated 1 July 2024, there is no reason why the general rule on costs should not apply so that they should bear the Bank’s costs of the action (including those incurred after 17 November 2023), for detailed assessment on the standard basis if not agreed; save in respect of the costs of the Discontinuance Costs Application, to which they were not a party, and subject as follows.

1. 1. For the same reasons set out above in respect of the Discontinuing Claimants, I consider it appropriate that there be (i) a distinct order in respect of the Jurisdiction Application, but in this case to include costs incurred after 17 November 2023; (ii) orders for interim payments on account of costs as to £500,000 in respect of the Jurisdiction Application and £500,000 as to the balance of the costs; (iii) joint and several liability; and (iv) 28 days for payment. Further, as with the Discontinuing Claimants, all existing orders in the proceedings to remain in effect.

1. 1. As to QOCS, the claims of the Continuing Claimants in each case include claims for damages for personal injuries. However all of their claims were struck out on the grounds of abuse of process: see my judgment delivered on 1 July 2024 in [2024] EWHC 2951 (KB) at [40].

1. 1. As noted above, by CPR 44.15(b), orders for costs made against the claimant may be enforced to the full extent of such orders without the permission of the court where the proceedings have been struck out on the grounds that the proceedings are an abuse of process. As held in Achille, the ‘proceedings’ in CPR 44.15 has the same meaning as in CPR 44.13, namely all of the claims made by a claimant against a single defendant when one such claim is a claim for personal injury.

1. Since all of the claims of each Continuing Claimant were struck out on the grounds of abuse of process, their position is to be distinguished from the claimant in Achille. It follows from CPR 44.15(b) that in each case the Continuing Claimants have no QOCS protection against enforcement of the costs orders made against them.