Legal Cost Specialists

costs budgeting

Costs budgets and experts’ trial fees

By on Nov 13, 2019 | 2 comments

The new Guidance Notes on Precedent H, following the update to PD3E para.7.4 (which came into force on 1 October 2019), moves trial brief fees from the Trial phase to the Trial Preparation phase.  This is presumably on the basis that the brief will be delivered before the trial commences and liability for the brief fee will often be treated (at least as between the solicitor and counsel) as being payable upon delivery. Strangely, the Guidance Notes give no indication as to what phase any experts’ fees for attending trial should be placed into.  Traditionally, these fees have been placed in the Trial phase.  However, the majority of experts will usually expect payment of their fee, or at least a discounted payment, where they have been booked for the trial even if the matter settles early.  Should experts’ fees for attendance at trial therefore not also be placed in the Trial Preparation...

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New Guidance Notes on Precedent H

By on Oct 18, 2019 | 0 comments

The new Guidance Notes on Precedent H have now been published following the update to PD3E para.7.4 (which came into force on 1 October 2019) which now defines budgeted and incurred costs as: “a. Incurred costs are all costs incurred up to and including the date of the first costs management order, unless otherwise ordered. b. Budgeted costs are all costs to be incurred after the date of the first costs management order.” However, there are other significant amendments to the Guidance Notes.  The most important being that trial brief fees are now to be placed in the “Trial preparation” phase rather than the “Trial” phase, although refreshers remain in the “Trial” phase. This amendment is likely to trip up many.  It will be interesting to see how lenient the courts are where the brief fee is placed in the wrong...

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What to include in a costs budget

By on Aug 14, 2019 | 6 comments

I have seen a number of Precedent H costs budgets which include, within the ADR/Settlement phase, the anticipated court fee for the Consent Order recording the settlement agreement. Is this correct? Costs budgets are predicated on the basis that the matter will proceed to a final trial. That is why there is a Trial phase. The total figure for the budget therefore reflects the anticipated costs that will be incurred if the matter does not settle and proceeds all the way to trial. Given that is clearly correct, surely the court fee for a Consent Order should not be included. On the other hand, the Guidance Notes on Precedent H include, under examples of the work to be included within the Settlement phase: “Drafting settlement agreement or Tomlin order” That would therefore suggest that any corresponding court fee should indeed be included. What happens then if a budget is approved/agreed that includes the court fee but the matter does not settle before trial? On detailed assessment, does the fact that one of the assumptions on which the budget was prepared (that the matter would settle within the ADR/Settlement phase) did not occur mean that there is a “good reason” to depart downwards from the budget? If so, to what extent? For example, a claimant’s budget is prepared estimating, for the ADR/Settlement phase, £2,000 profit costs and £100 consent order fee. The budget is approved as drafted. Negotiations are unsuccessful and so no settlement agreement or Tomlin order is drafted and no consent order is filed. The claim succeeds at trial. The claimant serves a bill claiming exactly £2,100 profit costs. The court’s approval of the budget will “relate only to the total figures for budgeted costs of each phase of the proceedings” and the approved figure would have been a global total of £2,100, which the receiving party has not exceeded. As per HHJ Dight CBE in Barts Health NHS Trust v Salmon [2019]: “it seems to me that the fact that the phase of the budget relating to experts was … substantially incomplete was capable of being a good reason, and it would have been open to the Master on that basis to consider whether to reduce the...

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New Precedent R costs budget discussion report

By on Feb 28, 2019 | 1 comment

A new Precedent R costs budget discussion report form has been produced that will come into force from 25 April 2019 (last page here). In terms of changes to the current version: The form now includes incurred costs. This may, in part, have been to avoid confusion as to what figures were meant to be inserted into the “Claimed” column.  I suspect the main reason was to emphasise that the court is meant to take into account incurred costs when considering the reasonableness and proportionality of all budgeted costs (as per PD 3E para.7.4). I am somewhat struggling to understand the final three columns on the form. Column K is presumably for the judge to insert the total that is being allowed for future budgeted costs.  Columns L and M appear to be designed, in part, for the judge to insert comments on the costs claimed/allowed.  This certainly makes sense in relation to commenting on incurred costs and is precisely what PD3E para.7.4 envisages.  It can also be very helpful if a judge makes comments on the reasoning behind the estimated costs allowed.  At detailed assessment, comments on the reasoning behind the figures allowed can greatly assist when determining whether there is a good reason for departing upwards or downwards from the budget.  However, columns L and K are split between “Time (hours)” and “Disbursements”.  This appears to run the risk of encouraging judges to focus on the “constituent elements” of the budget rather than, as per PD3E para.7.3, the “total figures for budgeted costs of each phase of the proceedings”. The “summary” box at the bottom of the form refers to “Post CCMC costs summary”. This appears to be predicated on the basis that the costs of the actual CCMC will be included under “Incurred costs”.  This may help solve the problem of where to include the CMC/CCMC work within Precedent H.  At the time the budget is completed this work (or at least the majority) will be estimated but by the time the budgets are actually approved will have been work that has been completed (and thus incurred).  Hopefully, the Guidance Notes to Precedent H will be updated to clarify this.    ...

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