25 April 2013Print This Post

Fundamental review of guideline hourly rates gets underway – and don’t assume they’ll go up

Dyson: seeking comprehensive evidence-based recommendations

The guideline hourly rates (GHR) are set to undergo a fundamental review this year which could result in rates being set for specific areas of work in addition to seniority and geographic banding, it has emerged.

The new Civil Justice Council costs committee met for the first time last week to scope out its work and warned that it should not be assumed that an increase in the GHR will result.

The committee had been asked to report by January 2014 but it decided that this was not realistic “given the scale of the exercise and the impact of the numerous April 2013 reforms”, a synopsis of the meeting said.

Instead it is aiming to report by the end of March 2014, a delay agreed by the Master of the Rolls, Lord Dyson. In response to a letter from the committee’s chair, Mr Justice Foskett, Lord Dyson said: “Although I am keen for a new rate to be established, given that it has not been updated since 2010, my primary concern is that I have comprehensive evidence-based recommendations to assist me in determining the rate.”

The committee resolved that it needed to investigate the cost of work – that is, the expense of time – and not just charge-out rates (“important though that aspect was”, the synopsis noted). It emphasised the importance of confidentiality for its data sources as a high response rate was important for the committee to offer authoritative advice.

The synopsis continued: “Although personal injury cases remain a key element in the process, the committee has to look at setting a rate or rates across the whole spectrum of civil litigation. One proposal was that distinct sets of rates should be recommended for particular areas of law, eg, personal injury, clinical negligence etc.”

Seeking Lord Dyson’s views on this, Mr Justice Foskett said in his letter: “The rationale would be to reflect the reality of the way the market imposes different rates depending on the volume and complexity of a particular area of law…

“At the end of the day, of course, whether we could achieve recommendations of this nature will depend on the quality and extent of the evidence we receive and the resources available to evaluate the evidence.”

Lord Dyson said he was open to the idea: “I am happy to take advice from the committee. I will then reach a conclusion based on the strength of the argument and the weight of views expressed to the committee on the merits of the proposal.”

The names of those on the committee have yet to be released as the Law Society has not finalised its claimant and defendant nominations, while a consumer representative has not yet been selected.

Three academics will be helping the committee: Professors Paul Fenn, Neil Rickman and Steve Machin. Professor Machin, who is a new name to those in the costs world, is a professor of economics at University College London.

By Neil Rose

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2 Responses to “Fundamental review of guideline hourly rates gets underway – and don’t assume they’ll go up”

  1. Anybody thought of asking a Cost Lawyer to assist the committee ?

  2. Graham Cunliffe on April 25th, 2013 at 3:37 pm
  3. Actually, Graham, they have! The ACL has a seat on the committee (see http://www.litigationfutures.com/news/costs-committee-begins-take-shape) and Iain Stark attended the meeting.

  4. admin on April 25th, 2013 at 11:58 pm