4.6 Introduction to costs management

Question 1

CPR 1.1(1)

Answer 1

CPR 1.1(1)

…the overriding objective of enabling the court to deal with cases justly and at proportionate cost.

Question 2

For the purposes of the Overriding Objective, what does ‘proportionate costs’ mean?

Answer 2

Costs are proportionate if they bear a reasonable relationship to:

1. The sums in issue in the proceedings;
2. The value of any non-monetary relief;
3. The complexity of the litigation;
4. Any additional work generated by the conduct of the paying party;
5. Any wider factors such as reputation and public importance.

Question 3

What is costs assessment?

Answer 3

The final assessment of costs which the court makes after a case has concluded and will make an order requiring (usually) the losing party to pay.

Question 4

What is costs management?

Answer 4

The process throughout pre-trial and trial by which the court seeks to ensure that the parties keep their costs within proportionate limits.

Question 5

Why is ongoing costs management beneficial, as opposed to just a final costs assessment?

Answer 5

1. It enables the court to ensure that its case management directions are proportionate in the costs that they impose on the parties;
2. It gives the parties certainty so they can regulate their own behaviour.

Question 6

What are the four basic stages of the costs management regime?

Answer 6

1. Budgets - exchange and discuss;
2. Budget discussion reports - agreement (if any) on budgets;
3. Case / Costs Management Conference;
4. Directions Order or Costs Management Order.

Question 7

Which Rule sets out the types of multi-track cases to which the costs management process does not apply?

Answer 7

CPR 3.12

Question 8

To which multi-track cases do the costs management rules not apply?

Answer 8

CPR 3.12(1) [summarised]

(a) claims for £10 million or more commenced on or after 22nd April 2014; or
(b) partially or wholly unquantified monetary and non-monetary claims commenced on or after 22nd April 2014, where the claim form states the value is over £10 million; or
(c) claims made by or ob behalf of children commenced on or after 6th April 2016; or
(d) where the proceedings are the subject of fixed costs or scale costs; or
(e) the court otherwise orders.