REUTERS | Dinuka Liyanawatte

Fixed costs pilot

A voluntary two year capped costs pilot scheme for High Court cases valued between £100,000 and £250,000 is due to begin imminently in the London Mercantile Court and the Mercantile, Technology and Construction and Chancery Courts in Manchester and Leeds District Registries.

Although voluntary, once a party has agreed to enter the scheme it will not have an automatic right to leave it. This principle has already been established in relation to the Intellectual Property Enterprise Court (IPEC): see 77M Ltd v Ordnance Survey Ltd and others.

The claimant can always issue in the scheme, but the case will only continue within it if the defendant consents.

There is a streamlined procedure based on the Shorter Trials Scheme. The trial will be fixed within eight months of the case management conference (CMC) and is limited to two days.

Each phase of work is capped and the overall total is capped. Costs will be subject to summary assessment and the indemnity principle will apply, in contrast to the existing fixed costs scheme (see Nizami v Butt).

There will be no costs budgeting.

When the minimum jurisdiction of the High Court is raised from £100,000 to £250,000, it is proposed that claims subject to the pilot remain in the High Court.

Cases which involve an allegation of fraud or dishonesty, or involve multiple issues and parties, or are likely to require expert evidence or extensive disclosure or extensive evidence are excluded.

Pre-issue

The claimant sends a “succinct” letter of claim notifying the defendant of intention to issue in the Capped Costs List.

The defendant responds within 14 days stating whether it agrees to the matter being in the pilot.

Statements of case

Particulars of claim and defences with counterclaim are limited to 20 pages. All other statements of case are limited to 15 pages.

A bundle of core documents must be appended to the particulars of claim and additional core documents must be appended to subsequent statements of case.

The particulars of claim and any counterclaim must contain a brief summary of the dispute, a list of anticipated issues and a concise statement of the facts and arguments relied upon, as well as a full statement of all relief and remedies claimed and detailed calculations of any money claimed.

Detailed provision is made concerning the acknowledgement of service, and defence and arranging the CMC. The trial advocate or a senior legal representative – undefined – must attend the CMC.

Disclosure

The general rule is no disclosure and the parties will be able to rely only on the core bundle.

Experts

The general rule is that expert evidence will not be allowed.

Witnesses

Limited to two witnesses per party with each witness statement limited to 15 pages.

Applications

Except for the CMC, the court will generally deal with applications without a hearing.

Trial

The CMC judge will hear the trial.

Cross-examination will be strictly controlled and timetabled.

Judgment will be given within six weeks.

Appeals

The Court of Appeal will expedite appeals in capped costs cases.

Part 36

Indemnity costs will be awarded, but capped at a sum equal to 125% of normal capped costs.

 The figures

Work done in respect of Maximum amount of costs
Pre-action £10,000
Particulars of Claim £7,000
Defence and counterclaim £7,000
Reply and defence to counterclaim £6,000
Case Management Conference £6,000
Disclosure £6,000
Witness Statements £8,000
Experts’ reports £10,000
Trial and judgment £3,000
Settlement/negotiations/mediation £10,000
Making or responding to an application £3,000
Work done post-issue which is not otherwise covered by any of the stages above £5,000

The total costs are capped at £80,000 plus VAT and court fees and costs relating to the enforcement of any court order.

The total costs on an indemnity basis are capped at £100,000 plus VAT and so on.

Wasted costs can be ordered in addition.

See here for full Civil Procedure Rule Committee minutes, including draft rules.

 

Underwoods Solicitors Kerry Underwood

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