Costs Budgeting following the 109th CPR update

The 109th update has clarified what falls within the “incurred” costs, and made some changes to the guidance regarding which phase costs fall into. Watch the video for more detail and some tips on how to manage the period between the drafting of the budget and the date of the costs management hearing.

Anna Lockyer is an Associate and Costs Lawyer in the Clarion Costs Department. You can contact her by email at Anna.Lockyer@Clarionsolicitors.com, or by phone on 0113 288 5619.

 

COVID 19 update: face to face hearings

HMCTS are consolidating the work of the courts and tribunals into fewer buildings. It has been announced that from Monday 30 March 2020 there will be a network of priority courts that will remain open during the coronavirus pandemic to make sure the justice system continues to operate effectively.

Fewer than half of all court and tribunal buildings will remain open for physical hearings, with 157 priority court and tribunal buildings remaining open for essential face-to-face hearings. This represents 42% of the 370 crown, magistrates, county and family courts and tribunals across England and Wales.

To help maintain a core justice system that is focused on the most essential cases there will be open courts, staffed courts and suspended courts.

The Judiciary recommend that you check which courts are open before you travel.  For information regarding the category of each court lease follow this link.

Lord Chancellor Robert Buckland has said that it is vital that we keep our courts running. and that:

An extraordinary amount of hard work has gone into keeping our justice system functioning. Technology is being used creatively to ensure that many cases can continue. Not everything can be dealt with remotely and so we need to maintain functioning courts.

These temporary adjustments to how we use the court estate will help ensure that we can continue to deal with work appropriately in all jurisdictions whilst safeguarding the well-being of all those who work in and visit the courts”.

Staffed courts will support video and telephone hearings and progress cases without hearings and ensure continued access to justice.

The remaining courts and tribunals will close temporarily and these measures will be kept in place for as long as necessary.

Sue Fox is a Senior Associate and the Head of the Costs Management team in the Costs and Litigation Funding Department at Clarion Solicitors. You can contact her at sue.fox@clarionsolicitors.com and 0113 336 3389, or the Clarion Costs Team on 0113 246 0622.

 

 

 

 

Coronavirus Update: Bar Council guidance on attendance at Court

The Bar Council has today given further guidance to its members that advocates should not attend hearings in person unless they are “genuinely urgent” and cannot be done remotely. However, it is anticipated that such a hearing will be a rare occurrence.

My standing advice is that where a hearing is listed, practitioners should contact the court as soon as possible and ask for guidance. I recently wrote to the County Court at Huddersfield and asked what procedures are currently in place; I received a response today stating that “all hearings will be adjourned: you will be contacted before the hearing”.

The situation continues to develop rapidly and therefore it is likely that the position in relation to hearings will change.

Matthew Rose is a solicitor in the Clarion Costs Department. You can contact him on 0113 222 3248 or by email at Matthew.Rose@clarionsolicitors.com.

Third Party Funders – Exposure to Legal Costs

The Court of Appeal has recently handed down its Judgment in the case of Chapelgate Credit Opportunity Master Fund Limited -v- Money and Others [2019], which was an eagerly awaited decision for litigation funders. The outcome of the case is as follows:

The Arkin Cap should be considered when determining costs, but it is not binding on the Courts.

Paragraph 38:

“……..I do not consider that the Arkin approach represents a binding rule. Judges, as it seems to me, retain a discretion and, depending on the facts, may consider it appropriate to take into account matters other than the extent of the funder’s funding and not to limit the funder’s liability to the amount of that funding”

For those unfamiliar with litigation funding and the Arkin Cap, this arises out of the Court of Appeal decision in Arkin -v- Borchard Lines Limited 2005. In that case, a company which had provided third party funding for an unsuccessful claim was ordered to pay the costs of the winning party, but only to the extent of the funding provided. The Arkin Cap has been a principle which has been regularly applied by the Courts since. The decision in Chapelgate will cause uncertainty for litigation funders, in a world which has significantly evolved since 2005.

The Judgment increases the requirement for litigation funders to properly engage costs lawyers. Funders should be engaging costs lawyers to scrutinise a law firm’s legal budget when they are applying for funding. Costs lawyers should also be retained to monitor costs versus budget (including the opponent’s costs) and to advise on costs management orders.

Costs management orders provide more certainty on detailed assessment (unless the order for costs is made on the indemnity basis). Such measures will ensure that the funder has the maximum control possible on both the costs of the firm they are funding and the opponent’s legal costs; the latter being important in the event that an adverse order for costs is made.


This blog was written by Andrew McAulay who is a Partner at Clarion and the Head of the Costs and Litigation Funding Team. Andrew can be contacted on 0113 336 3334 or at mcaulay@clarionsolicitors.com

Appellant victorious in arguing indemnity costs

The Court of Appeal determined that poor conduct and a failure to accept an earlier Part 36 offer were grounds on which to award indemnity costs in the case of Lejonvarn v Burgess & Anor [2020] EWCA Civ 114. 

The appellant had provided some gratuitous help to her former neighbours in re-designing the landscape of their garden. They had a falling out and the respondent neighbours subsequently brought proceedings against the appellant on the basis that she had been negligent and owed them a duty of care. Three weeks after proceedings had commenced, the appellant made a Part 36 offer in the sum of £25,000, but this was not accepted. Although at trial it was found that the appellant had been negligent, the respondents had failed on the substantive issues and the £25,000 offer was not beaten. The respondents lodged an appeal which caused their costs to spiral as they pursued their case against the appellant. The respondents were unsuccessful at the appeal and the appellant was awarded costs on the standard basis.

The appellant then proceeded to challenge the standard costs award decision and appealed on the basis that this was incorrectly ordered and indemnity basis costs should instead have been applied. At the appeal hearing Coulson LJ considered the background and undertook a thorough review of authorities relating to indemnity costs, opining that:

No later than one month after the handing down of the judgment by the Court of Appeal…the respondents, having had time to consider the implications of the Court of Appeal judgment, should have realised that the remaining claims were so speculative/weak that they were very likely to fail, and should not be pursued any further.” 

Coulson LJ further explored the respondents’ unreasonable pursuit of the case to trial, considering it to be: 

An irrational desire for punishment unlinked to the merits of the claims” and “precisely the sort of conduct which the court is likely to conclude is out of the norm”.

It was determined overall that the first appeal trial judge had incorrectly applied the test to determine indemnity costs and indemnity costs were in fact appropriate in these circumstances from a specific point in time. 

The judgment in this case may be of assistance should you need to consider conduct and indemnity costs in a situation where a party beats their own Part 36 offer. Bear in mind however that it is nuanced to the specific facts of the case and the CPR is clear that entitlement to indemnity costs in these circumstances is not automatic.  

The outcome of this case was also interesting from a costs management angle as Coulson LJ found that costs assessed on an indemnity basis are not constrained by an approved budget. Please see my blog for further detail.

Anna Lockyer is an Associate in the Costs and Litigation Funding Department at Clarion Solicitors. You can contact her at anna.lockyer@clarionsolicitors.com and 0113 288 5619, or the Clarion Costs Team on 0113 246 0622