The defendant costs specialists

Guideline hourly rates

By on Sep 27, 2013 | 17 comments

I recently came across the following on another costs related blog (note the capitalisation):

“The Guideline Hourly Rates ARE DESIGNED FOR FAST TRACK CASES.”

Poppycock.

The 2010 Guideline Rates for Grade A fee earners in the City is £409 per hour.

A bottle of champagne to the first reader who can send me a transcript of a judgment, where the rates have been challenged, allowing a rate of £409 for a fast track matter.

They are guideline rates for judges carrying out summary assessment. That might include interim applications in complex multi track commercial disputes or summary assessments of the costs of an appeal in the Court of Appeal.

The confusion appears to come from the fact that because it is intended that a summary assessment would be undertaken at the end of a fast track trial that this is the full extent of the role of the guideline hourly rates.

See: How the rates were calculated.

    17 Comments

  1. On a related note a colleague of mine attended a cost management hearing where the judge declined to make a costs management order (as it serves only to add expense for all parties!) other that to record the parties’ totals and state that my colleague should be bound by the guideline rate (he was charging £230 and the others £217). I understand the rationale but one of the parties recorded costs £20k above the others despite acting for Part 20 defendants and being on the periphery of the substantive proceedings.

    The judge also seemed to have overlooked the use of the word ‘guideline’ and the calculation comes from an average set of rates. By denying the higher rates (to those firms whose overheads are higher) this applies a false metric to the assessment process.

    Back on topic though I can understand a person saying that the rates are designed for fast track as fast track cases should be summarily assessed at the end. So the rates *are* designed for fast track but not *only* for fast track but for all cases where summary assessment is appropriate.

    Perhaps ignorance led to a misleading statement?

    Charles Wheatcroft

    27th September 2013

  2. On the last provisional assessment I had back the Judge wrote in the bill (in a clinical negligence case) “What have the SCCO Guideline rates got to do with it? This is a provisional assessment, guideline rates are for summary assessment only.”

    J-P

    27th September 2013

  3. Claimants always say not applicable when they are looking for higher rated. However, the same Costs Consultants seem to be the 1st to take offence, if you suggest a case merits rates below the SCCO Guidelines for the conducting fee earners.

    X

    27th September 2013

  4. So they are so stretched with the new provisional assessment system that they are employing judges with no understanding of costs at all to assess the bills, then?! The judge seems to be suggesting that the work must have been more complicated or the fee earners more skilled (or the other way around if rates lower than guideline were allowed) JUST because their costs didn’t get assessed at the end of a court hearing but got assessed afterwards instead :-/ Very messed up!

    Richard

    27th September 2013

  5. Costs Judges like to just make hourly rates up as they go along and tend to do just that. Fair enough if you are an experienced Costs Judge but it means there is zero guidance for the many Judges dealing with costs who actually know very little about costs.

    The lack of guidance as to hourly rates in high value claims and when enhancement should be applied means highly anomalous decisions. People rely on cases that predate the CPR or at least the present Grade A rates (2001) as the only guidance leading to higher hourly rates when applied to the present rates. Alternatively Judges just allow an additional percentage on everything rather than the 1/3 of the hourly rate that made up the ‘B Factor’ meaning any increase is approximately 2/3 too high.

    The House of Lords / Supreme Court position of no more than the guideline rates no matters what the case was the right one in my opinion.

    Incidentally with regards to “how the rates were calculated” the answer is in a pointless, stupid, circular way in the 2008 review.

    I would love to know what the clever Costs Judge who completely disregards guideline rates uses as an alternative starting point. Perhaps he or she has conducted private “expense of time” studies on all firms undertaking clinical negligence work in a particular area?

    'king costs

    27th September 2013

  6. Thanks for this Simon

    They are indeed guideline only in SA

    So can all Defendants please stop quoting the Guidleines incorrectly and making out they are set in stone and immutable????

    Anonymous

    27th September 2013

  7. @’king’
    Clearly there are many more ‘clever’ cost judges out there than your good self, as the Guidelines have been examined and dismissed, in reported Judgement.

    I won’t trouble you with the case name, you’re so clever already you will know it……

    Anonymous

    28th September 2013

  8. Anon is right.

    Defendants should start pitching offers much lower than SCCO Guideline figures.

    After all it has been suggested that the ongoing review of hourly rates may not necessarily lead to rates going the way Claimants think they should !

    X

    28th September 2013

  9. @X
    Spoken like a true defendant costs monkey whom hasn’t a clue about where the rates come from

    Funny how ALL Defendants latch onto the guidelines when they occasionally win a case

    Perhaps if said same Defendants would have ever participated in hourly rate surveys over the years when asked, rather than pedalling their ‘commercially sensitive’ trash, they would have some point. The fact is they never did and have no point.

    X, I welcome you offering less than guideline, I’ll make even more money from you in bills and DA costs

    Anonymous

    29th September 2013

  10. The idea of the Court of Appeal utilising the Guideline hourly rate for a City case is utterly laughable.

    Whilst you are a knowledgeable fellow Simon, it simply doesn’t and couldn’t happen.

    Paying party’s rely on the Guideline hourly rates as if they govern all of litigation. When the fact is they relate to one small area.

    Useful and honest debate to have however. Not surprising you haven’t addressed it before given your clients.

    Anon

    29th September 2013

  11. Simon, that publication is useless

    Look at section 29.1 – standard fees for drawing bills. How many bills of £2k have you seen in the Supreme. Court ( and if you have, I bet you objected anyway!!)

    All this is, is a prime example that even the Govenment cuts n pastes and doesn’t read what it’s doing

    Anonymous

    30th September 2013

  12. Anon- The court of appeal do use the guideline rates when conducting a SA. The idea that they are for fast track matters only is just wrong. Was it Cook on Costs which first suggested this?

    Counsel

    1st October 2013

  13. Recently C appealed as DJ had incorrectly placed too much reliance on SCCO Guideline figures & sought to stay all of their firms outstanding claims pending resolution of this point. Circuit judge said DJ should not have placed so much reliance on Guidelines but he would have reduced rates further than the DJ did & so, decided to let things be…

    X

    1st October 2013

  14. What did the circuit judge think the DJ should have relied on instead of the guideline rates? Had C sols provided any alternative evidence other than the guideline rates?

    If there was no alternative evidence as to at least a starting point for assessing guideline rates. On being appointed as a DJ are you imbued with a knowledge of the mystical “going hourly rate” for certain tasks or is there a specicific methodology for calculating the correct hourly rate that I am not aware of?

    If anyone knows please share because if guideline rates are not at least the starting point I not only have no idea how to calculate enahncement in any case post dating the introduction of the CPR but I do not even know what the correct starting point is.

    'king costs

    1st October 2013

  15. There is a complex formula to ensure the rate applied is accurate. X + F(2)/The price of a packet of fags x 2/100.

    You’re welcome.

    The guidelines were based on data; albeit limited data. That’s better than instinct.

    Maybe the problem is people put the Grade before the rate, and it should be the other way around? £201 is not a rate applicable to a Band 2 Solicitor with 40 years experience. It is a rate applicable for a FT matter (or a SA hearing) conducted by a Solicitor of that standing.

    If that Solicitor conducts a MT million pound clin neg case, £201 is inadequate.

    Me

    2nd October 2013

  16. Never mind give it 5 years and there will be no need to worry about hourly rates as they will play no part in assessment.

    Barry

    7th November 2013

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