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Paul Reason &
Tosh.The word is apt to describe some of the
Our aim is to paint as accurate a picture as
“Costs lawyers are in danger of extinction”.
April. It should not be implemented at all.
Nothing could be further from the truth.Budgeting will be the
norm in multi-track cases although it will not apply to commercial
or admiralty work. His Honour Simon Brown QC has recently
recorded a training talk for the Judiciary in which he makes it clear
that the task of creating a plausible budget is a double act
performed by the litigator in collaboration with their costs lawyer.
It is essential for each party to produce a viable budget. Get it
wrong and the real risk is that costs otherwise recoverable will be
disallowed. When interviewed last spring Sir Rupert said that
budgeting was the single most important reform for practitioners
to embrace.The cost of Counsel is to be included in the budget
form H, a detail that some have yet to appreciate.
“After the event insurers will go out of
business”. No they won’t. One of us (DR) has been chairing focus groups
for First Assist which is committed to providing cover in the
commercial litigation sector and Temple has declared that it will
provide cover in QOWCS case to protect a claimant from the risk
of costs being awarded where a Part 36 offer from the defendant
is not bettered.
“Reform will not actually change anything“.
“Fewer claims will be brought”.
There is no reason to suppose that the number of events or
incidents giving rise to an arguable cause of action will diminish.
The arrival of qualified one –way costs shifting in the injury arena
can only provoke claims as the claimant does not ordinarily face
a costs liability if they fail. The increase in the non – injury small
claims limit from £5,000 to £10,000 could also encourage
claimants to pursue an action. Solicitors, unable to recover costs
from the loser unless there is a finding of unreasonable conduct
for the purposes of CPR 27.4, may well propose that they act on
a contingency ( called a damages based agreement in the 2012
Act ) whereby they can take up to 50 % of the winnings as
payment for their labour.At the other end of the spectrum it is not
difficult to envisage litigation of substantial value being funded
by the same method where of course the return is not directly
linked to hours expended but rather result achieved.
“All proposed reforms are endorsed by Lord
Whilst the key planks of change such as the ending of
recoverability of additional liabilities are his work, it should be
noted that he did not support increasing the small –claims limit.
He was also against early portal extension which has run into
serious difficulty and is now, rightly, not being implemented in
6 It will. Budgeting apart, we have the arrival of a more stringent
approach to default with a taut new CPR 3.9.Out goes the current
shopping list of factors to be considered where a party seeks relief.
The new emphasis is upon the need for litigation to be conducted
efficiently at proportionate cost and the need for the authority of
the court to be respected. Sir Rupert is of the opinion that a
troublesome minority do not take orders seriously and then,
when in difficulties, buy their way out by paying an adverse costs
order. The new philosophy is that orders mean what they say and
should be rigorously enforced.
“We will be left alone for at least another
decade“. No. Lord Dyson MR has already said that more reform is likely
in the near future, perhaps 3 years down the line. To take a
random example, practitioners are confronted by 13 Protocols,
none of which strike us as simple or straightforward. At the very
least we expect severe pruning if not uprooting of some.
“The costs wars are over”.
If only. Since the forthcoming reforms are not retrospective it is
clear that disputes in current matters about the cost of insurance
and /or the size of a success fee will trouble the courts for years.