Temporary Disapplication of Costs Budgeting Rules Announced

Prinz Nagalingam, Senior Solicitor Advocate

Prinz Nagalingam, Senior Solicitor Advocate

Temporary Disapplication of Costs Budgeting Rules Announced

The High Court has announced a temporary break from costs budgeting for clinical negligence cases in London with hearings listed between October 2015 and January 2016. The break has been implemented on the request of Lord Justice Jackson in response to waiting times for a first CMC now running to 9 months in the Queen’s Division, a delay he has branded as “unacceptable”.

A spokesman for the Judicial Office stated that:

As a temporary measure, to clear a backlog of cases, the Queen’s Bench Masters responsible for the case management of clinical negligence cases are exercising this discretion in relation to cases listed before them between October 2015 and January 2016. This approach will be kept under review”.

The Court already retains a discretion under the rules as to whether or not to make a costs management order but to date there has been a general presumption in favour. It is therefore a significant response to issue a blanket directive for an effective temporary suspension of costs budgeting (rather than on a case by case basis) in order to clear a mounting backlog.

Jackson’s motivation in seeking a temporary relaxation of the rules lies in an increase in clinical negligence actions issued in the capital, which in 2014 was close to double the 800 cases issued in 2009. The Courts’ expectation appears to be that taking this measure will clear the backlog by September.

Presumably this disapplication of the rules will continue until the backlog is cleared. However, it is difficult to see how this provides a long term solution without better Court resources or an altered approach going forward – something Jackson has eluded (more of which below).

The High Court has already begun sending out orders stating that claims will not be subject to costs management. The Order require that costs estimates be exchanged within 14 days of the order, rather than 14 days before the hearing.

This is going to place a significant burden on Solicitors who will have to prepare sometimes very substantial costs estimates within constrained time limits.

Should you receive such an order please contact PIC immediately and we will be more than happy to help. Our Costs Lawyers and Draftspersons are on standby to assist to make sure you do not miss any deadlines.

We should stress that cases already subject to a case management order will remain budgeted as ordered. We presume the disapplication of the rules will only apply to those new issued cases which have not been subject to any costs budgeting directions though it is plausible that even issued cases which have a costs and case management hearing date listed may be effected.

Looking ahead on how to prevent backlogs occurring again, the solutions seem rather obvious to us; either equip the Courts with better resources or change the rules as to when costs budgeting will be applied.

In terms of the latter, an unlikely supporter of a rule change is Jackson himself who has suggested a new rule that a court should not impose costs management if they lacked “the resources to do so without causing significant delay and disruption” to the management of cases.

In effect, such a rule change would be a significant movement away from the current presumption in favour of costs budgeting – something not lost on Lord Dyson who in response observed that if such a rule were to be implemented then “there was a real danger that costs management will become the exception and not the rule in clinical negligence cases”.

That is a matter for the future. In the meantime should you receive one of the High Court’s new ‘costs estimates’ orders then please contact the PIC team who will be available to assist you no matter how urgent the task.