Paul Hughes succeeds in first appeal in overturning a refusal to allow an ATE premium in low value child/protected party case

In the first reported appeal of its kind, Paul Hughes has succeeded on first appeal in overturning a refusal to allow an ATE premium in low value child/protected party case.

In X (by way of litigation friend) v H&M Hennes and another [2022] Lexis Citation 102 (HHJ Lethem, Central London County Court 21 April 2022), HHJ Lethem tackled a point he described as being of general importance, in overturning a District Judge’s decision to refuse a litigation friend’s application for the deduction from a Claimant’s damages of an amount due in respect of an ATE premium taken out to protect against adverse costs and own disbursements.

HHJ Lethem’s key findings were that:

• it is appropriate in such a case for the litigation friend to be joined as the appellant the appeal. This was based upon a submission that, pursuant to MA Holdings Ltd v George Wimpey UK Ltd [2008] 1 W.L.R. 1649, the litigation friend had a real and substantial financial interest in the case;
• The starting point in a case in which an ATE premium is sought to be deducted pursuant to CPR 21.12 ought to be that the litigation friend has approved the costs and that they are reasonably incurred and reasonable in amount; this is a consequence of the direction to CPR 46.9;
• Reasons would need to be given for departure from that starting point, and they could not include that the ATE premium was disproportionate in the individual case
• In the instant case, it was inconsistent to allow a success fee and then disallow the ATE premium on the grounds that the risk was de minimis;

The appeal is likely to provide reassurance to Claimant firms who have, hitherto, been subject to a variety of different decisions on this issue which, although individually of low value, has wider ramifications in practices specialising in personal injury involving children and protected parties.