For all the costs reform we have seen over the past two decades, there remains plenty of scope for more, and the Master of the Rolls, Sir Geoffrey Vos, last month made clear his intention to take this forward – and potentially in a radical way.
Giving the keynote address to the Association of Costs Lawyers (ACL) annual conference in London, he revealed that he has already asked the Civil Justice Council (CJC) to “embark on a review of costs issues at all levels, including the guideline hourly rates”, as he indicated he would do when setting the new rates in August of this year.
It was, he said, “extremely important” to consider whether the costs system – including costs shifting – were “fit for a modern justice system delivering dispute resolution digitally”.
This required an “holistic consideration of a number of interconnected issues”, listing the move to more remote hearings (given that the guideline hourly rates are based on location), his vision of an “entirely digital online justice system”, the extension of fixed recoverable costs, ‘money no object’ litigation in the Business & Property Courts, and the development and use of pre-action portals, artificial intelligence and blockchain, which required “a completely fresh look at the costs of civil litigation more generally”.
These are all game-changing propositions but he also indicated a more immediate review of costs budgeting, saying “we should undoubtedly take another look” at it given the time that has passed and “considerable experience” gained by judges and practitioners.
Though stressing that he would not start this process with “any preconceived ideas”, Sir Geoffrey recounted sitting in on a case and costs management conference in Birmingham recently in a clinical negligence case worth £100,000. Much of the two-hour hearing was dedicated to costs budgeting, with many of the arguments focused on “quite small issues in the defendant’s costs budget”. He continued: “And one was driven to wonder how often those costs are ever recovered against such claimants.”
Speaking to the conference later, ACL special adviser Professor Dominic Regan wondered whether we had witnessed the “first death knell” for budgeting. He detected “an undertone that budgeting might get the chop”, a move he said some judges would welcome.
Other senior figures also want to see change – for example, the Senior Costs Judge, Andrew Gordon-Saker, has made clear his enthusiasm for the costs provisions of the Solicitors Act 1974 to be brought up to date. And it has emerged that the government wants the extension of fixed recoverable costs to happen in October 2022.
Perhaps it is just as well that our conference also heard about the potential for costs lawyers to become involved in legal project management.
James Barrett, a costs lawyer and senior legal project manager at Eversheds Sutherland, explained how litigation was “particularly well suited” to project management, with costs lawyers already carrying out some of the role in dealing with Precedent H. They were also used to “talking to and challenging partners” in a way that associates may not be keen on. Francis Kendall, a costs lawyer at Kain Knight (City) Ltd, predicted that the practice of legal project management would “filter down from the big firms”.
Let us not forget too the more day-to-day challenges of the costs world, also covered by the conference, such as: the never-ending stream of cases on CPR 36, or “the gift that keeps on giving,” as speaker Rupert Cohen of Landmark Chambers put it; the implications of the Supreme Court’s ruling in Ho v Adelekun; the impact of compulsory ADR, which looks likely to be introduced next year in some form; and even more technical issues like conducting provisional assessments with an electronic bill.
This is all against the background of possible regulatory reform. The conference heard from Professor Stephen Mayson, whose independent review of legal services regulation last year recommended that only properly qualified and regulated costs lawyers should be allowed to handle costs litigation and advocacy.
He outlined his thinking behind this, arguing there was a “clear public interest” in requiring regulation as the work of costs lawyers supports the rule of law and the administration of justice. Unregulated costs specialists, by contrast, “pose a risk to the public interest and to consumers”. This is a position we at the ACL strongly support.
As Professor Regan said, Sir Geoffrey Vos is a doer. But he has set plenty of plates spinning across the civil justice system in his first year as Master of the Rolls, with digital transformation undoubtedly the biggest and most important. He can’t do everything at the speed he clearly wants, so the costs management review may well be the initial focus. But more fundamental change seems in the offing.
