UNIT 15 - Civil Litigation. Suggested Answers June 2010
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1 UNIT 15 - Civil Litigation Suggested Answers June 2010 Note to Candidates and Tutors: The purpose of the suggested answers is to provide students and tutors with guidance as to the key points students should have included in their answers to the June 2010 examinations. The suggested answers do not for all questions set out all the points which students may have included in their responses to the questions. Students will have received credit, where applicable, for other points not addressed by the suggested answers. ILEX is currently working with the Level 6 Chief Examiners to standardise the format and content of suggested answers and welcomes feedback from students and tutors with regard to the helpfulness of the June 10 Suggested Answers. Students and tutors should review the suggested answers in conjunction with the question papers and the Chief Examiners reports which provide feedback on student performance in the examination. Question 1 (i) The size of the debt will determine whether the case will be allocated to the small, fast of multi-track. If a debt is less than 5000 then it is likely to be in GFD s best interests to deal with any potential litigation. The reason for this is that our firms legal costs will not be recoverable. This will make our involvement prohibitively expensive. Although no formal protocol exists for debt claims it is best practice to send a letter before action to any proposed Defendant. (iii) Before any proceedings can be issued it will be necessary to prepare a claim form. This will include a statement of truth signed by the Claimant or our firm if we are instructed. At least three copies of the claim form will need to be filed at court with the appropriate fee. Once filed the court will issue the claim and effect service by first class post. It may also be possible for GFD to use the money claim online scheme, particularly if it is expected that claims will need to be issued on a regular basis. (iv) In these types of debt recovery cases it is not unusual to act on a fixed fee basis. For example a set fee can be charged for preparing a letter before action or a draft claim form on behalf of a client. An alternative could be to agree set cost limits with the client.
2 (b) (i) Initially this claim would have been allocated to the small claims track but because the Defendant has made a counterclaim for 6,000 it will now be allocated to the fast track. The contract contains a number of provisions that support our claim. In the Defence it has been claimed that the desks supplied were defective. The contract states at clause 8 that any defects should be reported in writing within 7 days of delivery. This has not happened as several weeks have passed. In addition any liability relating to the quality of the desks has been excluded. Finally the Defendant s Counterclaim will be limited to 4,500 in accordance with clause 10. Because of the contract it would appear that the Defence to our claim is weak and the Counterclaim is limited at best or invalid at worst. (iii) If the Defendant accepts that the contract was not actually breached based on the points raised in question c(i) then they should admit liability and drop the Counterclaim. If they do not take these steps then the Defendant may be liable for our costs. (iv) If the Defendant accepts the contract is valid but fails to do anything further then summary judgment should be sought. This would require an application to the court which would have to highlight that there was no good reason why the claim should not be disposed of in this way. (c) (i) GFD could take the following steps to enforce judgment: - 1. Obtain a warrant of execution An application would be made to the county court with payment of a fee. The warrant would allow the court bailiff to seize goods. 2. Seek a third party debt order If GFD are aware that the Defendant is owed money then they can ask the court to transfer the debt. 3. Obtain a charging order This would allow a charge to be placed over the Defendants land or other assets. The Defendant would have to convince court that several weeks of correspondence had genuinely been lost. The Defendant would also have to prove that they had not admitted the claim in open correspondence. As this is a Summary Judgment it is more likely that the Court will grant the appeal rather than act unjustly.
3 Question 2 Memo To:- Mark Jones From:- Re:- Personal Injury claim Mrs Nowak Dated:- Mrs Nowak and her husband were both seriously injured because of heavy metal poisoning. The injury occurred as they had both drunk from a defective flask purchased by Mr Nowak from a local department store that has now gone into administration. We are only receiving instructions from Mrs Nowak as she is currently separated from her husband. Mrs Nowak appears to have an action in tort rather than contract as she did not purchase the flask. More specifically she has a product liability claim based in negligence. There are a number of issues that require urgent attention before we can proceed further namely:- Transfer of instructions Mrs Nowak would like to transfer her instructions as she is unhappy with the time it has taken to deal with her claim. An authority for the transfer of her file from her current solicitors has been prepared. I have also prepared a draft client care letter, but until we receive her former solicitors file we will not be in a position to provide accurate cost estimates or make an assessment of her prospects for success; Limitation - Some time has passed since the incident. I have made a note on our case management system as we are approaching the limitation period; Financial viability As you will have noted above the store where the defective flask was purchased has now gone into liquidation. We will need to contact the Administrators as a matter of urgency to establish whether any product liability insurance policy was in place at the time of the incident; Parties to the action Mrs Nowak does not know if any one other than the Administrator has been identified as a potential Defendant. If a request has not already been made we should contact the Administrator as a matter of urgency to try and obtain details of other parties involved in the supply of the defective flask. (b) (i) Based on her symptoms the following remedies could be included in Mrs Nowak s claim:- General damages Pain and suffering Based on her suffering form tremors; leg cramps; shortness of breath; insomnia; diarrhoea; Loss of amenity Based on her no longer running Loss of future earnings / pension rights Based on her suffering form chronic fatigue; memory loss; depression; and stress Life expectancy Special damages Loss of actual earnings Based on time she was in hospital Medical expenses Travel expenses
4 Five aspects of the personal injury pre-action protocol that could be consider for Mrs Nowak s claim include:- 1. The need to provide early notification that the claim is likely to be worth in excess of 25, A letter of claim should be prepared, including a request of details of any insurers. The letter should have a summary of the facts and outline the nature of Mrs Nowak s injuries and losses. 3. The Defendant should reply to a letter of claim in 21 days or maximum of 3 months. Getting an early reply might be difficult as the department store where the flask was purchased has gone into administration. 4. A schedule of special damages should be given to the Defendant, if practical. 5. As this may be a complicated case a full list of experts should be identified, if possible. (iii) In this case we know that some time has passed since the original incident. In these circumstances you might be forced to issue proceedings if the limitation period is approaching. If only one Defendant has been issued against then it is likely that they will bring additional claims under Part 20 (i.e. third party proceedings).
5 Question 3 As this is a claim for breach of contract Mr Gauntlet may claim interest under any provision that might have been made in the contract. He would also have the right to claim interest under the County Court Act 1984 at 8%. Finally interest could also be claimed under the Late Payment Commercial Debts (Interest) Act This act would allow interest to be claimed at 8% over the base rate and allows of a set sum to be claimed in compensation. (b) (i) The Defence being claimed by Bright Windows suggests there has been a breach of a condition of the parties contract. In addition because of the breach Bright Windows are claiming that they had to obtain replacement goods from a different supplier as a matter of urgency. The suggestion that our claim should be limited to 1,500 is based on setting our claim of 9,500 against their costs replacing the goods of 8,000. I would expect the Defence and Counterclaim to include an admission of any undisputed facts. Details of any Counterclaim such as the claim for 8,000 relating to the order for replacement goods should also be included with an explanation of why it was necessary to order from a new supplier. (iii) If the Defendant were claiming the goods supplied are faulty then it would be unreasonable for them to refuse an inspection by the Claimant. It has also been suggested that the faults were so serious that replacement goods needed to be obtained from a new supplier on an urgent basis. The Claimant would have no way of verifying how serious the defects were unless they inspected the goods supplied. If the Defendant refuses to allow an inspection then we could apply for directions and seek independent expert evidence. (c) (i) Costs are normally awarded to the winning party. In a fast track claim costs would normally be dealt with immediately after the final hearing when the trial judge considers the winning parties statement of costs on a summary basis. The Court may be reluctant to award costs where the winning party has made very inaccurate estimates of costs. This would particularly be an issue where the legal costs claimed are more than the sum in dispute. It is a principle of the Civil Procedure Rules that claims should be dealt with in a proportionate manner. The Claimant may be able to justify a higher level of costs if they can prove to the Court that the Defendant has behaved unreasonably during the case. (iii) If the issue of costs cannot be dealt with by summary assessment then the detailed assessment procedure will need to be followed. The procedure would include the following steps:- Commencement within 3 months judgment
6 Service of a notice of commencement on the paying party together with a bill of costs Points of dispute (if any) served within 21 days of commencement by the paying party The paying party would have the opportunity to reply to the Bill and raise points of dispute If a settlement can not be reached then the parties must attend an assessment hearing After the detailed assessment hearing a final cost certificate is issued
7 Question 4 (i) Before legal proceedings are issued we could consider negotiating a settlement or entering into some form of ADR. As this is a technical dispute it may be possible to instruct a mediator who has some building expertise. Arbitration might be another option. Making an offer in accordance with Part 36 of the CPR may put additional pressure on the Defendants. Under Part 36 an offer should be in writing, state that it is a Part 36 offer and should be open for at least 21 days. The advantage of using this tactic is that it should focus the Defendants mind to consider a compromise seriously. The Defendants appear willing to negotiate and the difference between the parties reaching an agreed settlement is relatively small. If the Defendant does not beat the Part 36 offer at the final hearing then they may have to pay interest at 10% above the base rate and pay costs on an indemnity basis from the date when they could have accepted the offer. (b) (i) As this is a fast track case the amount of expert evidence permitted will be limited. The parties will also be expected to try to co-operate and it is possible that the Court will order that only one joint expert may be appointed. The surveyors statement may bring into question his independence or competence. Any concerns about this expert should be raised in writing with the Defendant. It should be suggested to the otherside that a new joint expert should be appointed. If the otherside refuse to agree this then an application to the court should be considered. (c) (i) If a settlement is reached before judgment which requires further work to be done then a detailed consent order will need to be drafted which outlines what steps are to be taken. This kind of order is known as a Tomlin order. Proceedings would be stopped if a Tomlin order was used. The issue of costs would need to be addressed. If these are substantial and cannot be agreed then it may be necessary for the costs to be dealt with by detailed assessment. (iii) The disadvantage of reaching this kind of settlement is that the order would have to be very detailed to ensure that the work was carried out to the satisfaction of the Claimant. It would seem more straightforward to agree a settlement figure and conclude the proceedings by way of a consent order. As pointed out in question above the issue of costs will also have to be dealt with either through negotiation or through detailed assessment.
In cases where there is no Protocol in place then parties are expected to abide by the guidelines set down in Section III of the PDPAC and Annex A.
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