fixed costs

Jackson LJ has delivered his Keynote Address on the Review of Fixed Recoverable Costs.

On 11th November 2016 the Lord Chief Justice and the Master of the Rolls commissioned Lord Justice Jackson to carry out a review with the following terms of reference:

1. To develop proposals for extending the present civil fixed recoverable costs regime in England and Wales so as to make the costs of going to court more certain, transparent and proportionate for litigants.

2. To consider the types and areas of litigation in which such costs should be extended, and the value of claims to which such a regime should apply.

3. To report to the Lord Chief Justice and the Master of the Rolls by the 31st July 2017.

The Full Lecture Note

Some key points:

“One strong message which comes over in many of the submissions and also at the seminars is that (despite all the criticisms in the past) costs management is now working much better…  Many people are arguing that this does away with the need for fixed costs in the multi-track. The counter-argument is that for lower value cases, a fixed costs regime is simpler and cheaper.”

“Defendants and liability insurers are inclined to accept that costs management controls future costs. But they maintain that fixed costs would be better.”

“Another frequent message in this review is that one size doesn’t fit all.  There is force in that point.  I have therefore got to identify which types of case and which ‘levels’ of case are suitable for fixed costs”

“Outside the fast track, there is much more controversy about which (if any) cases should have fixed costs.  One view is that costs management should take care of everything above the fast track.  The alternative view is that lower value multi-track cases should have fixed costs.”

“Many people are arguing that the value of a claim should not be the sole determinant of whether it is suitable for fixed costs.  One must also look at the complexity of the case, the number of issues, the number of experts and so forth”

If some lower value multi-track cases are to have fixed costs, should a new ‘Intermediate track’ be created to accommodate such cases?  In that event, what should be the procedural rules for the Intermediate track?

“In lower value business disputes involving individuals and SMEs, some litigants may welcome a fixed costs regime combined with a streamlined process. Taking up a suggestion made in two of the written submissions, I am exploring the possibility (subject to the approval of the Rule Committee) of piloting such a regime on a voluntary basis.”

“‘Lower value’ has different meanings according to context. In the mercantile courts (I am told) ‘lower value’ means claims up to about £250,000. In personal injury litigation, on the other hand, the upper limit for ‘lower value’ claims would be well below that figure.”

“In relation to judicial review, the issues are complex. My previous recommendation for QOCS in this area was not taken up by the Government. A number of interesting suggestions have been made. One idea floated is that the optional fixed recoverable costs rules which apply to Aarhus cases might be developed and applied more generally to judicial review claims.”