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What counts as a significant development to amend approved Budgets?

A “significant development” to amend an approved Budget must be a development that could never have been reasonably foreseen or anticipated at the point of Budget preparation. Even then, the Court would need to ascertain whether the development had already been catered for and whether the amount warranted a revision.

The term ‘development’ may be taken to mean a specific event, at a specific date so as to establish a ‘development’, however, in the case of Thompson v NSL Ltd [2021] EWHC 679 (QB), Master McCloud confirmed that there will be cases where the nature of the claim evolves and a time comes when it is reasonably appreciated that it is a different type of claim from the one that was initially pursued, and that you may not be able to point to one specific event which led to that and it was in fact a collection of factors.

Master McCloud also referred to the case of Al-Najar & Ors V The Cumberland Hotel (London) [2018], whereby Master Davison derived five broad principles on the question of what amounted to a ‘significant development’ justifying a budget revision which were as follows:

1. Whether a development is ‘significant’ is a question of fact which depends primarily on the scale and complexity of what has occurred;
2. If what has occurred is something that should reasonably have been anticipated by the party seeking to revise its budget, then that party will probably be unable to label it significant or, for that matter, a development;
3. However, there is no requirement that the development must have occurred other than in the normal course of the litigation – he noted that in Sharp, a revision of the trial estimate, the disclosure of 984 documents and the service of an expert report were all characterised as significant developments;
4. “As a matter of policy, it seems to me that the bar for what constitutes a significant development should not be set too high because, otherwise, parties preparing a budget would always err on the side of caution by making over-generous [to them] assessments of what was to be anticipated”;
5. If there has been a significant development, then the question is whether the figures in the revised budget are reasonable and proportionate in light of the development.

We would suggest the above points are taken into consideration when reviewing the future budgeting aspects of a claim.

To summarise, if you believe there has been a change in your case whereby one of the above principles applies, please ensure that a Precedent T is prepared in good time in order to allow the same to be considered by the Defendant and the Court.

Please contact PIC if you are unsure whether your case warrants a “significant development”. We will be able to consider your file and advise on the appropriate steps to be taken.