Legal Cost Specialists

Defendants’ artificially low costs budgets

By on Aug 3, 2015 | 0 comments

I previously commented on the Coulson J, in CIP Properties (AIPT) Ltd v Galliford Try Infrastructure Ltd & Ors (Costs No. 2) [2015] EWHC 481 (TCC), as to the suggestion a defendant might try to submit a knowingly low costs budget:

“In his written submissions on behalf of the claimant, one of the points made … was that the court should not have any great regard to the costs budget figures put forward by the defendant and the additional parties because they had ‘an incentive’ to advance low figures in their costs budgets. This suggestion of manipulation of the figures by the other parties was, understandably, the subject of considerable protest. It seemed to me to be an unwarranted accusation. In truth, the party who was most vulnerable to such an accusation was the claimant itself.”

We can now add the comments of Stuart-Smith J in GSK Project Management Ltd v QPR Holdings Ltd [2015] EWHC 2274:

“Counsel for the Claimant in the present case submitted (rather faintly in the end) that the Defendant had underestimated the resources that were necessary. To my mind, if such a submission is to be made at all in the face of a Solicitor’s statement of truth that his costs budget is a fair and accurate statement of incurred and estimated costs ‘which it would be reasonable and proportionate for my client to incur in this litigation’, it needs to be properly substantiated; and that substantiation will probably require evidence and not mere assertion. It has not been substantiated in the present case.”

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