Mar 15, 2016

Fixing Costs in Civil Cases - LJ Jackson Gives His Updated View

Lord Justice Jackson (Jackson LJ), who readers may be aware was given the task of reviewing costs in civil litigation claims, has recently put forward the idea that fixed costs should be implemented in all civil claims that are worth up to £250,000.

The Proposals

Currently fixed costs only apply to personal injury claims valued up to £25,000. However, Jackson LJ believes that fixed costs should be the norm in all types of civil claim up to the value of £250,000.

Jackson LJ's 'grid' details the fixed costs recoverable for solicitors' and barristers' fees, excluding disbursements, enforcement fees and VAT. One of the advantages, he believes, would be to remove the time and cost associated with costs management in such cases.

If implemented the proposal would mean that in the first band i.e. cases worth between £25,000 and £50,000, the fixed amount for lawyers' fees would be £18,750. For cases worth between £50,000 and £100,000, the amount would be fixed at £30,000, for cases worth between £100,000 and £175,000, it would be £47,500. Cases falling in the 'top band' in the grid, i.e. those cases worth between £175,000 and £250,000, costs would be fixed at £70,250. It is presently unclear how these totals have been calculated.

The other criterion regarding what costs might be payable would be the stage the claim reached. The proposal is that the same 10 stages used in the grid would be those found in 'Precedent H', the court form currently used for costs budgeting in civil cases. The first of these is the pre-litigation stage, the second is statements of case or pleadings and so on.

"Certainty, predictability and proportionality" are the advantages seen by Jackson who believes that the new fixed costs will mean certainty of outcome for clients and that the pressures on costs budgeting will be reduced. Clients would potentially still be liable for their lawyer's costs on whatever basis has been agreed, but the amount recoverable from the other party would be what was fixed.

Negative Responses

The proposals have been met with some negativity. The President of the Law Society, Jonathan Smithers, thought that although the idea of having fixed costs is good for lower value and less complex cases, he is "extremely concerned" at the proposal that the costs in every type of civil claim up to a value of £250,000, should be fixed. Including such claims would include more complex cases into the fixed costs regime which could be inappropriate and inhibit those wanting to access justice.

It remains to be seen to what extent the proposals are implemented and there has been no official word from the Government, although Lord Faulks said that, "The Government remains supportive of the principle of extending fixed recoverable costs and we continue to consider areas in which implementation might be appropriate and workable".

Posted by: in: Civil Procedure, Legal News, News

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