MoJ Opens Fixed Recoverable Costs Consultation

On 11 November 2016, The Right Honourable Lord Thomas of Cwmgiedd and Master of the Rolls, Sir Terence Etherton, commissioned Sir Rupert Jackson, the former Lord Justice of the Court of Appeal, to produce a second report on extending the fixed recoverable costs regime.

In edition 196 of BC Disease News (here), we revealed that his Report (Review of Civil Litigation Costs: Supplemental Report - Fixed Recoverable Costs), published on 31 July 2017, proposed to introduce a matrix of fixed costs for all fast track claims (including NIHL claims) and an ‘intermediate’ track for claims valued between £25,000 and £100,000, also covered by fixed costs.

In respect of the bespoke fixed costs scheme, specifically for noise-induced hearing loss (NIHL) claims, the Civil Justice Council (CJC) set up a Working Party, whose final publication (Fixed Costs In Noise Induced Hearing Loss Claims: Final Report Of The Civil Justice Council Working Party) was published on 6 September 2017 (reported here). Most recently, in edition 202 (here), we considered whether clients would save more money under this prospective scheme than under the current handling regime. Of course, many NIHL claims would not be governed by the new scheme, such as:

  • Single defendant cases where the defendant puts their name on a list for all their cases to commence within the EL/PL portal.
  • Single defendant cases commenced within EL/PL portal which subsequently fall out of the portal. 
  • Military claims.
  • Claims valued at more than £25,000.
  • Claims with more than 3 defendants.
  • When a defendant argues in their letter of response: 
    1. The occupational loss is de minimis;
    2. Requests a second audiogram;
    3. Requests their own medical evidence; or
    4. Treats this as a ‘test case’ (the scope of this has not been agreed). 

Yesterday, the Ministry of Justice (MoJ) introduced a new fixed recoverable costs consultation, which closes on 6 June 2019.[i]

In the Ministerial Foreword to the consultation, the Lord Chancellor and Secretary of State for Justice, the Rt. Hon. David Gauke, stated that, given fixed costs have had ‘success in making costs proportionate and improving access to justice for many, we [the MoJ] are now looking to extend ...’

The purpose of the consultation, therefore, is to gather opinions from those with an interest in civil costs in England and Wales, on the Government’s plans to advance with the bulk of suggested reforms.[ii]

As a single exception to the former Lord Justice’s recommendations, the Government will not be pushing ahead with the conception of an ‘intermediate track’. Instead, it will be making the following compromise:

‘We agree with the principle of extending FRC to all the cases he recommended for his proposed intermediate track. However, we do not consider it necessary to introduce a new track, with the costs and complexity that that would involve. Rather, we propose to assign these intermediate cases to an extended fast track, where all cases will be subject to FRC. This should bring greater consistency and simplicity. For this reason, we refer in this document to ‘intermediate cases’ rather than a new intermediate track.

Mesothelioma claims will not fit the criteria of ‘intermediate cases’.

The MoJ has also taken up on Sir Rupert’s recommendation to award an uplift of between 30% and 40%, rather than indemnity costs, if a claimant beats a Part 36 offer – 35% is preferable.

Moreover, in cases where there is no trial, but there is a costs dispute, there should be a shortened form of detailed assessment, with a provisional assessment fee cap of £500.

Extending Fixed Recoverable Costs in Civil Cases: Implementing Sir Rupert Jackson’s proposals can be accessed here.

 

[i] Neil Rose, ‘Government to implement Jackson’s fixed costs blueprint’ (28 March 2019 Litigation Futures) <https://www.litigationfutures.com/news/government-to-implement-jacksons-fixed-costs-blueprint> accessed 28 March 2019.

[ii] Jake Exton, ‘Fixed recoverable costs consultation’ (28 March 2019 MoJ) https://consult.justice.gov.uk/digital-communications/fixed-recoverable-costs-consultation/> accessed 28 March 2019.