MOTOR ACCIDENT INSURANCE ACT 1994 - SECT 55F
Costs in cases involving relatively small awards of damages
MOTOR ACCIDENT INSURANCE ACT 1994 - SECT 55F
Costs in cases involving relatively small awards of damages
55F Costs in cases involving relatively small awards of damages
(1) This section applies if a court awards an amount equal to the upper offer
limit or less in damages in a proceeding based on a claim (but it does not
apply to the costs of an appellate proceeding).
(2) If the court awards an
amount equal to the lower offer limit or less, the court must apply the
following principles—
(a) if the amount awarded is less than the
claimant’s mandatory final offer but more than the insurer’s mandatory
final offer, no costs are to be awarded;
(b) if the amount awarded is equal
to, or more than, the claimant’s mandatory final offer, costs are to be
awarded to the claimant on an indemnity basis as from the date on which the
proceedings started (but no award is to be made for costs up to that date);
(c) if the amount awarded is equal to, or less than, the insurer’s mandatory
final offer, costs are to be awarded to the insurer on a standard basis as
from the date on which the proceedings started (but no award is to be made for
costs up to that date).
(3) If the court awards more than an amount equal to
the lower offer limit but not more than an amount equal to the upper offer
limit in damages, the court must apply the following principles—
(a) if the
amount awarded is less than the claimant’s mandatory final offer but more
than the insurer’s mandatory final offer, costs are to be awarded to the
claimant on a standard basis up to the declared costs limit;
(b) if the
amount awarded is equal to, or more than, the claimant’s mandatory final
offer, costs are to be awarded to the claimant on the following basis—
(i)
costs up to the date on which the proceedings started are to be awarded on a
standard basis up to the declared costs limit;
(ii) costs on or after the
date on which the proceedings started are to be awarded on an indemnity basis;
(c) if the amount awarded is equal to, or less than, the insurer’s mandatory
final offer, costs are to be awarded on the following basis—
(i) costs up to
the date on which the proceedings started are to be awarded to the claimant on
a standard basis up to the declared costs limit;
(ii) costs on or after the
date on which the proceedings started are to be awarded to the insurer on a
standard basis.
(4) Despite the limitations imposed by this section, the
court may make an award of costs to compensate a party for costs resulting
from a failure by another party to comply with procedural obligations under
this part.
(5) The court must not award costs to a party related to the
introduction of evidence by the party that is unnecessarily repetitive.
Example—
If a claimant calls 2 or more expert witnesses from the same area
of expertise to give evidence to substantially the same effect, and the
claimant is entitled to costs of action under the principles laid down in this
section, the court will only allow costs related to 1 of the expert witnesses.
(6) Unless an award of damages is affected by factors that were not reasonably
foreseeable at the time of the exchange of mandatory final offers, the court
must not award costs to a party related to investigations or gathering of
evidence by the party after—
(a) the conclusion of the compulsory
conference; or
(b) if the parties or the court dispenses with a compulsory
conference—the date when the parties completed the exchange of mandatory
final offers.
(7) If an award of damages is affected by factors that were not
reasonably foreseeable by a party at the time of making the party’s
mandatory final offer, the court may, if satisfied that it is just to do so,
make an order for costs under subsection (2) or (3) as if the reference to a
mandatory final offer in the relevant subsection were a reference to a later
offer made in the light of the factors that became apparent after the parties
completed the exchange of mandatory final offers.
Example—
Suppose that a
claimant’s medical condition suddenly and unexpectedly deteriorates after
the date of the final offers and the court makes a much higher award of
damages than would have been reasonably expected at that time. In that case,
the court may ignore the mandatory final offers and award costs on the basis
of later offers of settlement.