Costs management

Question 1

When does the costs management regime not apply?

Answer 1

• Small claims/Fast track
• Claims after 22 April 2014 amount of money claiming/value is £10 million or more
• Claims after 6 April 2016 made by/on behalf of someone under 18
• Claims subject of fixed costs or scale costs

Question 2

What is the costs management procedure?

Answer 2

1. Parties prepare budgets
2. Budget discussion report
3. Case/costs management conference
4. Directions/Costs management order

Question 3

When will parties file and exchange budgets?

Answer 3

Usually 21 days before first CMC
If value of claim < £50,000 = with Directions Questionnaire

Question 4

When will parties file and exchange budget discussion reports?

Answer 4

Usually 7 days before first CMC

Question 5

What does budget not relate to?

Answer 5

What a solicitor can actually charge

Question 6

What does preparing budgets require from practitioners?

Answer 6

to set out any assumptions on which budget is based and any possible contingencies

Question 7

What does not apply to the rule that only budgeted costs can be recovered?

Answer 7

Prior costs

Question 8

What will parties indicate in the budget discussion report?

Answer 8

a) Figures agreed/not agreed for each phase of litigation
b) Brief summary for grounds of dispute

Question 9

Does costs management need to take place at the case management conference?

Answer 9

Court can convene separate hearing

Question 10

When can the court make a costs management order?

Answer 10

At any time

Question 11

What will a costs management order do?

Answer 11

a) Record extent costs budgets are agreed, cannot be changed by court
b) Where figures not agreed, ‘record the court’s approval of a costs budget after making appropriate revisions’

Question 12

If there is no costs management order, what is the difference between the costs claimed on detailed assessment and the budget that will require consideration?

Answer 12

20% or more difference

Question 13

Where there is a 20% or more difference between costs claimed and budget, what happens?

Answer 13

• must provide statement of reasons for difference with bill of costs
• court may reduce recoverable sum if paying party reasonably relied on budget

Question 14

What is revising the costs budget used for?

Answer 14

addressing ‘significant developments’ in litigation

Question 15

How will costs budgets be revised?

Answer 15

• Amended budget should be submitted to other parties for agreement (Precedent T)
• Amended budget submitted to court for consideration

Question 16

What is the consequence of failing to file a costs budget?

Answer 16

Treated as costs budget comprising only applicable court fees unless court orders otherwise.