Judge predicts trouble ahead for costs budgets

Civil Procedure Rule Committee member Chris Lethem DJ has expressed his “deep unease about the desert of applications” to vary costs budgets, two years after the introduction of costs management.

Speaking at a roundtable of judges and practitioners organised by the Association of Costs Lawyers, Letham DJ said he hardly ever saw applications to do so. This, he suggested, was storing up trouble, because it was likely that parties would discover they had overspent at the end of the litigation process.

The only other explanation for the lack of applications to vary budgets, he suggested, was that he had achieved a “crystal vision” – a skill he did not believe he possessed.

Other practitioners speaking at the round table discussion said they deliberately avoided making applications to vary budgets, either because they believe the judge might not allow a change to take place, or because they feared the judge would then take the opportunity to reopen the previously-agreed budget.

Responding to a comment made by senior costs judge Master Gordon-Saker than no budgeted case had – to date – reached the Senior Courts Costs Office for detailed assessment, Lethem DJ predicted that, as cases began to settle, a “huge fertile ground for detailed assessment” would emerge. Parties were likely to disagree over whether phases had been completed, and also whether incurred expenditure were reasonable, he said. He also suggested it was not clear what amounted to a good reason to depart from a budget.

I do not think Andrew is going to be out of a job in the foreseeable future”, Lethem DJ added, referring to Master Gordon-Saker’s comments.

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