A warning from the High Court!
The Defendant has offered us X, but let’s push for a bit more. What’s the worst that could happen? Eugene Doris, Costs Consultant at PIC reports.
There are few things a competent costs lawyer dreads more than the glowering face of a Judge at a CCMC who is demanding to know why, given that the parties have obviously agreed directions, the costs have not been likewise agreed.
It is a common feature that you and your client will have your figures in the budget, your beige lines below that and your red lines further below. Your opponent offers you that little bit less than you think you absolutely need on a few phases, and you agree the others.
Should you progress to a CCMC to secure the costs you think you need? Or should you accept a lesser amount based on the risk that the Judge will both reduce your costs further and frown upon your reluctance (as it will appear to them) to settle this earlier and not waste Court time?
From a reading of the recent case of Gray v Commissioner of Police for the Metropolis  EWHC 1780 it would appear practitioners should think twice, as what may appear to be a relatively risk free wager on one or two unagreed phases could turn into a gamble, potentially on all phases (which you were perfectly happy with before).
At the CCMC in this case, the Claimant had their Budget reduced, to such an extent that they felt compelled to appeal the decision. One of the limbs of their appeal was that the Judge had reduced some phases to lower than what had been offered by the Defendant, with no explanation.
On Appeal, the High Court affirmed that the Judge was not required to spell out why they approved a figure lower than what had been offered by the Defendant. The reason was stated to be obvious, that the Court deemed both the figure offered by the Defendant (and the Claimant) not to be the proportionate figures that should be allowed. No explanation was required as to why the Court’s decision differed from the offer from the Defendant.
This case should therefore be a warning not to rely on offers (for phases) as benchmarks that can only be improved upon nor to trust them as worst case scenarios. One must always consider what figure the Court may approve at the CCMC based on all the arguments from both you and your opponent, and not your opponents’ offers.
At PIC, when we negotiate, we do not just go by opponents’ offers and engage in horse trading. We arrive at our estimates based on the facts of the case, our legal interpretation and our nous. We also monitor outcomes at particular courts so that we can have a better idea of what is likely to be awarded at CCMCs. We know that at the end of the day, the opponent does not decide the costs, that responsibility lies with the law.
Eugene Doris – Costs Consultant – PIC
1 November 2019