Lord Justice Jackson has been drafted in by the senior judiciary to work on extending fixed recoverable costs – even though earlier this year he said he would rather not do it.
The move by Lord Thomas, the Lord Chief Justice, and Sir Terence Etherton, the Master of the Rolls, comes in the wake of the commitment in September’s joint government and judiciary vision statement, Transforming our Courts and Tribunals, to look at options to extend fixed recoverable costs much more widely.
Jackson LJ, who has until 31 July 2017 to complete the review, has been chosen because the work is “a logical extension” of his 2010 report, in which he first recommended greater use of fixed recoverable costs.
Describing the current system as “exorbitantly expensive” in a speech earlier this year, he said the profession was now “more willing” to accept fixed costs, partly because it would “dispense with the need for costs budgeting, which not everyone enjoys”.
He called on the government to take a decision on whether to have fixed costs for cases worth up to £250,000, as he recommended, or for all cases.
Jackson LJ said that if the government did not “wish to pursue this reform as a priority”, it should “suggest that a senior judge who doesn’t mind being pilloried (preferably not me again)” actually draws up the scheme.
A statement put out today by the judiciary said the review has been agreed with the government “and will inform its public consultation on proposed reforms, which will follow the review after consideration of its recommendations”.
Lord Justice Jackson will formally commence his review in January 2017, but will be inviting written submissions on this topic immediately (see details below).
The terms of reference are “to develop proposals for extending the present civil fixed recoverable costs regime in England and Wales so as to make the costs of going to court more certain, transparent and proportionate for litigants”; and “to consider the types and areas of litigation in which such costs should be extended, and the value of claims to which such a regime should apply”.
Jackson LJ said: “I have set out my present views on the principles of fixed recoverable costs in the final report of my review and in recent lectures and publications.
“I have been commissioned to undertake this review because it is integral to the overall package of reforms which I originally proposed. Chapter 16 of my final report recommended that serious consideration should be given to extending fixed recoverable costs to the lower reaches of the multi-track after the other reforms had bedded in.
“Although the momentum is heavily for reform, the review will provide ample opportunity for comments and submissions on the form and scope that reform should take. I am inviting the views of practitioners, users of the civil courts and any other interested parties on these points. Seminars will be held in London and elsewhere to discuss the issues.
“There is a great deal to be done on the detail of the review, which will inform the government as it prepares proposals for formal consultation in due course.”
Law Society president Robert Bourns said: “We do not oppose the principle of fixed costs for straightforward, low-value claims as they can provide some certainty for both sides in litigation and avoid protracted disputes about the level of costs.
“But we have previously expressed concern at suggestions that costs should be fixed for all claims up to £250,000 – a tenfold increase on the current limit for many claims subject to a fixed-cost regime.
“Cases at this level of compensation include situations where people have been very seriously harmed and where the application of fixed costs would be totally inappropriate. It would also raise significant questions about people’s ability to access justice.
“Such a one-size-fits-all approach for all cases, regardless of complexity, will simply make many cases economically unviable, undermining the principle of justice delivering fairness for all.”
Association of Costs Lawyers chairman Iain Stark, a partner at Weightmans, said: “Whilst recognising the desire for wholesale reform, thereby providing certainty in the legal costs arena, this must be tempered by accepting that access to justice must be the bedrock of any consultation. We welcome the opportunity to respond.”
Nigel Teasdale, the new president of the Forum of Insurance Lawyers and a partner at DWF, said: “FOIL welcomes long-anticipated progress in the widening of fixed costs, with the launch of the review a first important step towards a positive outcome for the industry.
“It is very encouraging to see the determination for an extension, not only for clinical negligence and personal injury claims but across the civil justice system, and Lord Justice Jackson is absolutely the best-placed person to lead this review.”
Written submissions should be sent by 16 January 2017 to: firstname.lastname@example.org.
If evidence is being submitted of actual recoverable costs, this should identify the type of case (eg, clinical negligence, property, judicial review etc), and the source of evidence (eg, detailed assessments under the post-April 2013 rules, approved budgets, agreed budgets etc).
Material submitted should take account of the Civil Procedure Rules on proportionality, in particular the factors set out in rule 44.3(5).
Views are also sought on the level of claim at which fixed recoverable costs should stop and costs budgeting should apply instead.
Other issues that the review will need to consider, and on which views are welcomed, are how to accommodate counsel’s fees, experts’ fees and other disbursements within a fixed recoverable costs regime. Another issue for consideration is the difference which frequently arises between claimant and defendant costs.