Firms and judges “struggling with costs management”

Heining: costs lawyers have been thrust into the mainstream of the litigation process

Smaller law firms are struggling with the demands of budgeting, while larger practices are not as capable as they think, a judicial roundtable organised by the Association of Costs Lawyers (ACL) has heard.

But an ACL White Paper said costs management is here to stay – even if the teething problems will take some time to pass.

District Judge Margaret Langley, who sits at Central London County Court, told the event: “It is the small firms, certainly, who are really struggling. It is also some of the big firms, that you would think must have had training, and misunderstand what the rules say and just assume they are right.”

She added: “If I have three [multi-track cases] listed in a day, at least one will not have a budget. When you tell them, they look at you blankly… It is astonishing.”

Incoming ACL chairman Sue Nash told the roundtable: “There is a lot of head-burying. [Firms] realise that they need to know something, but when I ask them, ‘Well, are you recording your work by phase? Have you been doing this since last April and are you doing it now?’, there is a bemused shifting of the head.”

ACL chairman Murray Heining added: “There has been a lack of forward planning by a number of firms, on the basis that ‘Well, we will start dealing with these when we get the first one and until then, we will do nothing about it’. Law firms would be well advised to introduce a Costs Lawyer to a case at the outset.”

District Judge Ian Besford, a Regional Costs Judge, said that some judges remain hostile to costs management. “They would prefer not to do it. I am told that in certain areas, judges have unilaterally decided that in each case it is not suitable for cost budgeting… They tend to think that the process of detailed assessment that used to be in place was more than sufficient.”

Mr Justice Ramsey, the judge in charge of Jackson implementation, acknowledged that “some judges” have found cost management a real challenge. But nonetheless, “there is an awful lot of cost management going on”, he said, and was positive about the benefits: “For the first time, people are now seeing what the recoverable costs of the other side will be and what their recoverable costs are, at a very early stage. That is extremely helpful in trying to consider whether you should settle a case.”

The ACL White Paper concluded: “There is no doubt that costs management is not only here to stay, but will also be applied more widely in future. It has brought the skills and value of the Costs Lawyer to the fore, the quantity surveyors of the litigation world.

“The teething problems will take some time to pass, and if the 15 years since Woolf have taught us anything, it is that lawyers will still get the CPR wrong. The impact on access to justice also needs to be kept under constant review.”

Mr Heining commented: “The introduction of costs management on 1 April 2013 was a major moment in the history of the costs lawyer profession.

“By putting costs at the heart of the case management process, rather than being a matter left until after the event, it has thrust costs lawyers into the mainstream of the litigation process, where our skills and experience can benefit parties, their lawyers and the judiciary alike – and ultimately the good administration of justice.”

Download the white paper – ACL White Paper 2014 – or email for a hardcopy.

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