Fixed recoverable costs on cases worth up to £100,000

It seems likely that the long-anticipated extension to cases which fall under the fixed recoverable costs regime will now come into effect from April 2023. This is likely to affect the majority of personal injury lawyers and their costs lawyers since the extension is expected to cover most money cases worth up to £100,000.

There may be penalties where there has been unreasonable conduct, or where a Part 36 offer has been beaten, and the Ministry of Justice is also considering whether there should be an uplift in cases where a party or witness is classed as “vulnerable”, but only where additional work has been required as a result.

Clearly, change is on the horizon, and we are going to have to live with it, like it or not. I have no doubt that we can all weather the storm as long as we prepare ourselves for what is to come.

 

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Dispensation from Court Fees

In the matter of Gibbs v King’s College NHS Foundation Trust , Costs Judge Rowley held that a party who was eligible for a court fee remission and declined to claim it could not normally expect to recover the fee from the losing side in the litigation.

This case goes against previous rulings on this point which Costs Judge Rowley did not consider to be binding.

The moral of the story is that all steps should be taken to check whether a Claimant is eligible for a fee remission and, if they may be eligible, an application for help with fees should be made.  Failure to do so may result in a ruling that the court fee is not recoverable from the paying party.”

Gordon Exall’s very helpful blog on this case can be read in full at:

A PARTY WHO DOES NOT OBTAIN DISPENSATION FROM FEES, IF AVAILABLE, SHOULD NOT EXPECT TO RECOVER THE FEES: COST JUDGE DECISION

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Lodge an application to revise your approved Costs Budget or be prepared to suffer the consequences.

I have attended a number of assessments recently where the Costs Judge has taken a very strict line when considering whether or not to allow a party to depart from its last approved costs budget, even where there is clearly good reason to do so. This is because there are mechanisms in place to allow that party to request permission to revise its budget during the claim rather than hoping for the best upon service, and thereafter assessment, of the bill of costs. Accordingly, the Costs Judge is bound by the costs management order and cannot depart from the approved budget.

The position, now, is that if you expect to depart from your last approved costs budget, you should first prepare a varied budget using Precedent T (CPR PD 47) and serve it on the other party and try to agree the changes. If the changes are agreed, the Court's approval should be sought thereafter. If the changes cannot be agreed, the Precedent T should be filed at court with a request for permission to revise the last approved costs budget. It is not clear from the Rule (CPR 3.15A) whether a formal Application is required, but it can't hurt, so my advice would be to lodge the Precedent T as an attachment to a formal application.

Leave this to chance at your peril. If you have done the work, you should get paid for it, but you won't if you do not comply with CPR 3.15A even if you are able to show "good reason" to exceed budgeted costs.

If you require any assistance in updating your last approved costs budgets, please contact us at info@barnschapel.co.uk or by telephone on 01244 256865 and we will be happy to help.

Louise Spurdle

Director, Costs Lawyer, Accredited Mediator

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Proposed Increases to Guideline Hourly Rates Approved

According to the Law Society Gazette, the new guideline hourly rates as proposed by the CJC Working Group on the subject have been approved by Sir Geoffrey Vos and will come into force from 1 October. Vos went further in promising a review in two years. He said:

'The published guideline rates have been static for too long and this needed to be addressed. I am satisfied with the evidence and arguments set out by the working group. I plan to implement all the recommended changes from Friday 1 October 2021 and to that effect I have asked my officials and Master Gordon-Saker, senior costs judge, to take forward the publication of the revised guide to summary assessment".

This is good news for Claimant solicitors and also for costs lawyers who can now claim payment at grade B or C guideline rates, depending of the type and complexity of work undertaken.

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Recent Ruling May Assist in Costs Budgeted Cases

In a very recent ruling in the case of Discovery Land Company LLC & Ors v Axis Specialty Europe SE [2021] EWHC 2146 (Comm), Peter MacDonald Eggers QC has ruled that:

“Expenditure which is within a reasonable and proportionate range is still reasonable and proportionate even if it is not at the lower end.”

This is in contrast to the ruling in the case of Kazakhstan Kagazy plc v Zhunus [2015] EWHC 404 (Comm) in which Mr Justice Leggatt held that:

“What is reasonable and proportionate [to recover from the other party] must be judged objectively. The touchstone is not the amount of costs which it was in a party's best interests to incur but the lowest amount which it could reasonably have been expected to spend in order to have its case conducted and presented proficiently, having regard to all the relevant circumstances.”

Peter MacDonald Eggers QC also said:

“Certainly in the context of costs management, the court should allow some flexibility to the parties to ensure that their conduct of the action is not unnecessarily and potentially unfairly hampered by an unrealistically low assessment or by only the lowest assessment of what would constitute reasonable and proportionate expenditure.”

In many cases there has been a conflict between the need to keep costs down to the ‘lowest amount’ and the requirement and wish to do the best job for the client.  Hopefully, with this new ruling, more emphasis will be placed on what it is reasonable and proportionate to incur in order to conduct a matter in a manner which will provide the best outcome rather than necessarily the least expensive outcome.

For more information, visit our contact page or call us on 01244 256865.

Why not find out more about how we can help? Call us on 01244 256865 or send a message via our contact page.