More changes are coming to costs in the latest amendments to the CPR – Civil Procedure (Amendment) Rules 2021, which comes into force on 6 April 2021, and the 127th update to the PD.
These changes are not significant, however it is noted that there has been one amendment that is worthy of mention particularly for practical reasons. During the last tranche of costs changes in October 2020 (122nd update) when the costs practice directions and rules were consolidated and the precedent H guidance notes were incorporated into PD 3E, it was identified that one of the amendments created difficulties in terms of drafting of the budget. The amendment related to CPR 3.17(3)(a) which stated that the Court may not approve costs incurred before the date of any costs management hearing and replaced the previous practice direction that referred to how the courts may not approve incurred costs up to and including the date of the costs and case management hearing. This amendment resulted in the provision of updated incurred costs information that included an element of estimated costs, i.e. the costs associated with attending the CCMC. Please see follow this link https://www.clarionsolicitors.com/articles/costs-and-litigation-funding-newsletter-october-2020 for more a detailed analysis in that regard.
Master Cook recognised the difficulties that rule change made in the 122nd update created and has now addressed this in this latest tranche of rule changes. The rules have been amended, as follows:
“(3) Subject to rule 3.15A, the court (a) may not approve costs incurred up to and including the date of any costs management hearing; but (b) may record its comments on those costs and take those costs into account when considering the reasonableness and proportionality of all budgeted costs.”
This is a change that is very much welcomed and simplifies the presentation of incurred costs.
Some minor amendments to the cost management Practice direction 3E have been made which are limited to substituting “budgeted costs” for total costs (incurred and estimated) in paragraph 4b of practice direction 3E; and the substitution of interlocutory for interim at paragraph 10 (a). The final amendment relates to the table found in PD 3E in the Disclosure section, where ”third party” is to be substituted with “non-party”.
The PD 51X Costs for Summary Assessment Pilot scheme has been running for nearly 2 years and the judiciary have confirmed that they have received some useful comments, however they have extended the voluntary pilot scheme for a further year to enable the capture of more data.
Capped Costs Pilot
PD51W Capped Costs pilot scheme was launched in January 2019 and has run for 2 years. The scheme was limited to cases valued up to £250,000 in the Business and Property Courts in Manchester, Leeds and London Circuit Commercial Court. It followed a recommendation made by Sir Rupert Jackson in his 2017 report as part of his push for fixed costs. There has been limited uptake with only one case being heard under the pilot and consequently the scheme has not been extended.
The CPRC have commented that “it was acknowledged that the broad aims remain as current as ever and the need for schemes of this kind for the efficient despatch of medium value claims, whether as pilots or not, will continue to be considered in the context of post Covid-19 recovery and new ways of conducting business litigation”.