Success in Challenging a Staged ATE Premium

Published 29 octubre 2018

The challenging of ATE (After the Event) insurance premiums has historically been one of the most difficult areas for disputes and proved problematic to paying parties.  In a welcome judgment by Master James in case of Imansouren v Ocado Central Services Limited, the Claimant's conduct resulted in his stage 3 ATE of £94,000 being assessed at Nil.

The Claimant brought a claim for personal injury against his employer following an accident in July 2012. The Defendant admitted liability within two months from notification of the claim. The quantum only claim was issued in October 2015, with a schedule of loss, claimed at £46,000. The Notice of Funding was served at the same time of proceedings, but was incorrect as it provided that there were two stages to the ATE policy, whereas it had three stages.  The Claimant failed to comply with a number of Court orders causing significant delays.  An updated schedule of loss was served claiming £473,000, 7 months out of time and just 4 weeks before the 2 day Trial in July 2017. A bank statement was served in support a week later and within 14 days, the Claimant accepted the Defendant's time limited offer.

The Claimant's costs were agreed, leaving only stage 3 of the DAS premium to be assessed by the Master on the 17 October 2018.  The Defendant's submissions were:

• No notice of Stage 3 was given, in breach of the CPR Costs Practice Direction 19.4(3)(c) and therefore the Defendant was unaware of it.
• The Claimant repeatedly breached the Court timetable, delaying settlement until the last minute. At the PTR the Claimant obtained permission to increase the value by over 10 times.
• But for the Claimant's unreasonable failure to disclose Stage 3 and unreasonable delays, the claim would have settled before Stage 3 was triggered.
• It would plainly be unreasonable and unfair for the Defendant to pay Stage 3 given the Claimant's unreasonable conduct.
• If Stage 3 was found to be recoverable in principle, the quantum had been calculated at a sum that was too high and it ought to be reduced.

Master James agreed with the Defendant's view that it was unreasonable and disproportionate for the Defendant to pay Stage 3 and reduced it to Nil, awarding the Defendant their assessment costs of taking the point.  The judgment will be of benefit to insurers with disputes over legacy ATE premiums, as the Judge took into account the Claimant's unreasonable delays in disallowing one of the stages. The Defendant was represented by DAC Beachcroft Claims Ltd with Charlotte Mail dealing with the costs.