Legal Cost Specialists

Costs budgeting lessons

Claim with total value of £1.1 million. The claimant’s costs budget was in the sum of £821,000 odd together with VAT and the defendant’s cost budget was in the sum of £616,000. Case management hearing devoted solely to costs management.

Judge concludes that the costs shown in the costs budgets are disproportionate and unreasonable. Judge unhappy with level of detail contained in budgets. Judge concludes:

“In all those circumstances, I expressly decline to approve either party’s costs budget. I consider them to be disproportionate and unreasonable. I therefore have no option but to decline to make a costs management order. And, whilst I could order the parties to return at an adjourned hearing with new budgets, I am concerned that there is much work that the parties need to be getting on with in order to be ready for the trial at the end of the year, and I am anxious not to increase the costs burden any further. In addition, of course, any new budgets would show increasingly higher figures for costs incurred, and lower figures for estimated costs, making any costs management order less and less effective. I will therefore require the parties to keep their costs budgets up to date, and to provide them to the court at the PTR, but I do not think it is productive to order a further hearing simply to consider further costs budgets.”

I’m sure there is an important principle to be extracted from this case, I’m just not sure what: Willis v MRJ Rundell & Associates Ltd & Anor [2013] EWHC 2923 (TCC).

4 thoughts on “Costs budgeting lessons”

  1. The principle is for both parties, by their conduct, to conspire to front load the costs incurred as far possible. The position then reverts to pre-1 April 2013 where the parties take their chances on Detailed Assessment

  2. Plus we get three bites at the cherry (sorry only two for you Simon),
    (i) Preparing costs budget
    (ii) Preparing bill of costs
    (iii) Attending detailed assessment

  3. the important principle, is that Judges, even when told to do something by the Rules, disregard them – nothing new there , but at least now we have it in black and white

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