The new form electronic bill, coming into force tomorrow (6 April 2018), is “bound to save time and costs” and soon “people will be amazed that we had put up with the old paper-based bill for so long”, Jackson LJ predicted as he reflected on his reforms ahead of his retirement from the bench on 7 March 2018.
Speaking to the Cambridge law faculty two days before he turned 70, Sir Rupert said that many of the causes of excessive costs have been eliminated but litigation was still too expensive.
He commented on each of his key reforms. On the new bill, he said:
“The current form bill of costs is based on a Victorian account book and makes no use of modern technology. The proposal for a new form electronic bill of costs have been long – too long – in gestation, but they will be implemented this year.
“Practitioners will take time to adjust; there may be some teething troubles; there may be irate articles in the legal journals (with the usual friendly comments posted by readers). In the long term, however, the new form electronic bill of costs is bound to save time and costs. I predict that in three years from now people will be amazed that we had put up with the old paper-based bill for so long.”
The rules on the new bill apply to all multi-track claims, except those in which the proceedings are subject to fixed costs or scale costs, where the receiving party is unrepresented, or where the court has otherwise ordered.
It is in the form of Precedent S (called Precedent AA during the pilot scheme), although practitioners can use any other spreadsheet format so long as it meets the requirements of paragraph 5.A2 of revised Practice Direction 46. For example, the ACL Bill can be found here.
The reality is that practitioners have to get on top of the new bill, and fast. PD 46 says that they can choose how to present any work done before 6 April 2018 (that is, in the old or new format), but any work done from then must be an electronic bill. But there is a get-out clause: either on application by the parties or of its own motion, the court can disapply the requirement for an electronic bill.
There is concern that many judges have yet to receive training or the technology to view the bill from the bench, so this could initially be a popular course.
The new bill will be a work in progress for some time, for judiciary, practitioners and the rule committee alike. The practice direction is likely to need updating quickly. However, the new bill will change the whole ethos and environment we’re working in and too many people seem unaware of what’s coming; as one small example, you now have to serve the bill on the court at the same time you serve it on the other party.
You also have to file the electronic bill in hard copy because that is the only way that the court can ensure that the other side does not start tampering with it.
For those practitioners yet to get on top of the new requirements, it is important not to panic or bury their heads in the sand. The least they should be doing is downloading and playing with it. They need to upskill on basic Excel. I’m not technically literate and it’s been a massive uphill struggle for me, but if I can do it, then everyone can.
Jackson LJ’s long-term vision is that fee earners will record their time and then press a button to send the bill off to the court.
This “utopia” is probably a very long way away. Somebody is always going to have to monitor the data input and strip out those costs that aren’t recoverable. The theory behind the electronic bill is that it should be capable of being prepared directly from a firm’s case management system with minimal effort. This is an understandable aim.
However, the reality is somewhat different. Some firms of solicitors are more prepared than others for “E-day” with sophisticated systems already in place for recording work by phase, task and activity. Others continue to work with traditional paper files.
In all cases, the ability to generate a bill of costs directly from a case management system is some way off. Issues such as client privilege, interlocutory costs orders and apportionments, among others, are likely to mean that it remains so for some time.
It is inevitable that there will be teething problems (in all likelihood significant ones) with such a huge change to the world of costs. It happened before, with the Woolf reforms, and everyone survived.
Claire Green is council member of the Association of Costs Lawyers (ACL) and has led the ACL’s work on the electronic bill.