The note at the top of the Listing Questionnaire states “if no costs management order has been made you must attach estimates of costs incurred to date, and of your likely overall costs.” This can come as a nasty surprise, particularly to the lawyer under pressure with deadlines looming. So, what are the requirements for an LQ estimate?
The Old Rules (pre-April 2013)
Paragraph 6.4(1)(b) of the Costs Practice Direction said “when a party to a claim which is being dealt with on the fast [or] multi track files a pre-trial checklist (listing questionnaire) that party must also file an estimate of costs and serve a copy of it on every other party” and that the estimate should be “substantially in the form illustrated in Precedent H“. The costs practice direction (which used to be CPR PD 43 – 48) was completely omitted from 2013 onwards.
Current Rules (as at January 2021)
Under the rules as at January 2021 there is no requirement to file an estimate of costs with the LQ. Costs budgets are dealt with at CPR 3 and CPR PD 3E. The Practice Direction to the Fast Track states at CPR 28 PD 6.1 that “attention is drawn to the Costs Practice Direction, Section 6, which requires a costs estimate to be filed and served at the same time as the pre-trial checklist is filed”, but as stated above the Costs Practice Direction has not existed since 2013. There is no requirement at all within the Multi-Track Practice Direction at CPR 29 PD.
Under the current rules there appears to be no requirement at all to file costs estimates with the LQ. The CPR is fragmented and contains references to rules which no longer exist – it is very unclear what was even intended. It is arguable that Costs Management at CPR 3 and PD 3E was intended to do away with the old estimates regime altogether, and that the references in the CPR are simple drafting errors which were never removed. However, it is also possible to argue that the content of the LQ and the reference to estimates in CPR 28 indicate that where CPR 3 PD 3E does not apply, the “old” rules effectively remain in force.
What does this mean?
The rules clearly need amendment. It is certainly arguable that a Court Form does not or cannot impose additional requirements beyond those found in the CPR and that, absent a specific rule requirement, there is no requirement to do anything at all. However, the safest course of action is to simply file an estimate with the LQ.
There is no form requirement for an estimate at LQ stage and, given that there may not even be a requirement to file an estimate at all, it is understandable that legal representatives will want to minimise cost. You could use the old Precedent H (example here). However, a simple statement of the costs already incurred and what is expected to be incurred going forward would likely be sufficient to satisfy the requirements on the form (example here).
It is important to note that it is unclear what effect a costs estimate has if filed, or what the sanction might be if it is not. CPR PD 3E 3.2 states that if there is a difference of 20% or more between a costs budget filed by a party and the amount of any bill on detailed assessment that party must provide a statement of reasons. However, this applies only to costs budgets filed under CPR PD 3E and not to an estimate filed with an LQ. Ultimately, an assessing judge may take an estimate into account, they may not.
As of January 2021 the rules are very unclear about the requirements for filing an estimate of costs with the LQ, what form it should take, and what the consequences are of not filing or what the effect of a filed estimate is. Legal representatives should be aware of this potential issue and should consider how to approach it will in advance of the deadline for filing in order to decide the best course of action.
Matthew Rose is a Solicitor in the Costs and Litigation Funding Department at Clarion Solicitors. You can contact him on 0113 222 3248 or by email to firstname.lastname@example.org