We previously commented on this subject back in February (http://www.aftertheeventinsuranceblog.co.uk/qocs-apply-multiple-defendants/) but now the issue of the application of QOCS and claims against multiple Defendants has reached the Court of Appeal with the case of Cartwright v Venduct Engineering Ltd  EWCA Civ 1654 [https://www.bailii.org/cgi-bin/format.cgi?doc=/ew/cases/EWCA/Civ/2018/1654.html&query=(venduct)]
In Cartwright the Claimant had brought a claim for noise induced hearing loss against six Defendants.
The claim had been compromised against three Defendants by way of a Tomlin Order, allowing for the Claimant to recover damages and costs of the action against those parties.
The Claimant then discontinued his claim against Venduct, who then sought to recover its costs from the damages the paying Defendants had agreed to pay to the Claimant.
At first instance, the District Judge held that the successful Defendant could not recover their costs as the damages arose out of the Tomlin Order and not an Order of the court.
The Defendant appealed and that was leapfrogged directly to the Court of Appeal to consider the fundamental question under the QOWCS regime, namely the entitlement of a Defendant to enforce an adverse costs order against damages recovered by a Claimant from an unsuccessful co-Defendant.
In determining the first aspect of the Appeal, whether or not a Defendant can take advantage of damages paid to a Claimant by an unsuccessful Defendant, the Court found in the Defendant’s favour, considering that the Costs Judge was right to conclude that a Claimant who has an order for Damages and interest payable by a Defendant is liable to pay the successful Defendants costs, up to the limit of the Order for damages and interest payable by the unsuccessful Defendant.
However, the Court of Appeal agreed with the Costs Judge’s decision below on the applicability of the QOWCS regime to multi-defendant cases, that a “successful” Defendant could not recover their costs against a settlement agreement made as a result of a Tomlin Order (or indeed following acceptance of a Part 36 Offer) as a Tomlin Order is not an “order for damages and interest made in favour of the claimant” as the schedule is not a part of the Order of the court, instead it reflects the agreement reached between the parties and falls outside the words of r.44.14(1).
So, should a Claimant pursue a case against multiple parties to trial, succeed against one and lose against the others, those successful Defendant would be entitled to recover their costs against the damages and interest that may be Ordered by the court for the Claimant. However, if those damages are recovered by way of either a Tomlin Order or acceptance of a Part 36 offer, the successful Defendant would be unable to rely on CPR.44.14(1) in order to recover their costs against damages.
Claimant lawyers should note that this does not give free reign to pursue claims against as many Defendants as they wish in the hope that the claim will stick against one of them, with the Court of Appeal reminded Claimant lawyers that;
“It is important that claimants are discouraged from bringing proceedings which are unlikely to succeed. Claimants with QOWCS protection should not think that this general principle does not apply to them, or that they can issue proceedings against any number of defendants with impunity”.
Claimant lawyers will however, have to think very carefully before pursuing multiple Defendants, and how to conclude the claim against those Defendants, whether successfully or otherwise.