Costs Management Flashcards
Costs Management/Budgeting
WHAT IS COSTS MANAGEMENT
1.CPR 3.12 – Active………
* Achieved via
* applies to , except:-
-
-
-
-
*Even if exempt, Court retains discretion and can make an order for budgeting if sees fit. (PXT v Atere Roberts (2024) – ordered in case involving seriously injured children) OR Sharp v Blank (2015) - case over £10m
Costs Management/Budgeting
WHAT IS COSTS MANAGEMENT
1.CPR 3.12 – Active costs management by Courts to ensue costs are proportionate
* Achieved via Costs Budgeting and CMOs.
* Budgeting applies to All Part 7 Multi-Track cases, except:-
- Claims valued >£10 million (Where commenced on/after 22/04/14)
- Apps on/behalf of children (where commenced after 02/04/16)
- Fixed costs
- Court orders otherwise
*Even if exempt, Court retains discretion and can make an order for budgeting if sees fit. (PXT v Atere Roberts (2024) – ordered in case involving seriously injured children)
WHEN FILE BUDGETS
2. CPR 3.13 – -
a)
b)
- large cases …….
- CPR 3.14 –
WHEN FILE BUDGETS
2. CPR 3.13 – Unless Ct orders otherwise, all parties (except LIPs) must file & exchange:-
a) With DQ, where claim < £50k (parties must file agreed budget discussion report no later than 7 days b4 1st CMC), or
b) In any other case, not later than 21 days before 1st CMC
- large cases Ct may order budgets be limited in first instance to only part of the proceedings and extended later to cover whole of proceedings.
3. CPR 3.14 – Failure to File – treated as filing budget comprising only court fees (Would need to apply for relief from sanctions – Dention v White (2014) “Denton Principles” 3 stage test 1) seriousness and significance 2) reasons for breach 3) evaluate all circs and deal with fairly.
MAKING OF A COSTS MANAGEMENT ORDER ‘CMO’:
- ## CPR 3.15 :-
- CPR 3.15(8) -
MAKING OF A COSTS MANAGEMENT ORDER ‘CMO’:
- CPR 3.15 :-
- Court can make at any time
- Ct makes CMO unless considers matter can be conducted justly and proportionately w/o.
- CMO will record: the extent incurred and budgeted costs were agreed and the approval of budgeted costs once revised.
- Ct can record on the face of the order any comments on the incurred costs to be taken into account at DA. - CPR 3.15(8) - The CMO concerns only the phase totals; Detail for reference only. Not for Ct to fix or approve hourly rates;
HOW TO MAKE APPLICATION TO AMEND BUDGET
- ## CPR 3.15A :
- CPR 3.15A (5&6) -
- CPR 3.17(4)–
HOW TO MAKE APPLICATION TO AMEND BUDGET
- CPR 3.15A :
- Parties must revise budget upwards↑ or downwards↓ if significant developments
- 1st try to agree with o/s, If not apply, via CPR23 app
- Must be submitted promptly
- Use Precedent T form. Confined to additional costs arising from the significant development - CPR 3.15A (5&6) - Court may approve, vary or disallow the proposed variation.
- CPR 3.17(4)– Interim Apps – reasonably made, treated as additional to approved budget
ASSESSMENT
- CPR PD 44, 3.2 -
- CPR 3.18 -
ASSESSMENT
- CPR PD 44, 3.2 - Whether or not CMO, if the costs > budget by 20% or more, RP must serve a statement of reasons with the bill.
- CPR 3.18 - Where CMO in place & costs assessed on standard basis, consideration must be given to last approved/agreed budget of the RP. Cannot be any departure from budget unless good reason. + any comments made on incurred costs can be considered.
ESTIMATED COSTS & INCURRED COSTS AT CMC
R Y H S
11. R v C –
12. Y v M –
13. H v U -
14. S Oil v A E –
ESTIMATED COSTS & INCURRED COSTS AT CMC
R Y H S
11. Redfern v Corby BC [2014] – Court can show disapproval of costs by leaving little for prospective costs.
12. Yirenki v MOD [2018] – Budget should be global figures. Specifics left for DA
13. Harrison v UH Coventry [2017] - Incurred costs – DA. Estimated costs - subject to test of proportionality.
14. Sarpd Oil International Ltd v Addax Energy SA & Another [2016] – Defs should raise any issues with incurred costs at first CMC
MISTAKE AND TIMING
M E M
- M v D –
- E F C v A E & E –
- M v S –
MISTAKE AND TIMING
M E M
15. Murray v Dowlman [2013] – Amendment due to mistake - court takes dim view.
16. Elvanite Full Circle v Amec Earth & Enviro Ltd. [2013] – Confirms parties should be prompt in making an application.
17. Montres v Samsung – Failure to apply to amend, may be penalised even if additional costs can be justified at DA
SIGNIFICANT DEVELOPMENT - No clear definition. Needs to be change in assumptions leading to more than minimal change in cost
C T A B P H
- C v B -
- T v N -
- A v C –
- B v L –
- P H v O C -
- H v T –
SIGNIFICANT DEVELOPMENT - No clear definition. Needs to be change in assumptions leading to more than minimal change in cost
C T A B P H
18. Churchill v Boot [2016] - A change in claim value or longer trial. Foreseeable and no material impact - NOT
19. Thompson v NSL Ltd [2021] - Conduct– MAYBE
20. Al-Najar v Cumberland Hotel (2018) – much larger disclosure, & could not be reasb envisaged - POSSIBLY
21. BDW Trading Ltd v Lantoom Ltd [2020] – much larger disclosure than anticipated and expressed in budget assumptions – Yes (shows importance of budget assumptions)
22. Persimmon Homes v Osborne Clark LLP [2021] - Can be specific event or a “collection of factors” which change nature of claim. App should NOT be retrospective.
23. Hutson v Tata Steel (2020) – can make retrospective variation but needs to be significant enough
GOOD REASON TO DEPART – no definition in CPR
H M N E M B C U
24. H v U –
25. M v H –
26. N v M –
27. E F C v A –
28. M v H -
29. B H v H R S –
30. C v N –
31. U v C -
GOOD REASON TO DEPART – no definition in CPR
H M N E M B C U
24. Harrison v UH Coventry [2017] – Good Reason is High Bar to overcome
25. Merrix v Heart of England NHS Trust [2017] – Hourly Rates – Yes
26. Nash v MOD [2018] – Hourly Rates - No
27. Elvanite Full Circle v AMEC Earth & Enviro (2013) – Higher than anticipated Counsel and expert fees- NO
28. Merrix v Heart of England NHS Trust [2017] - indemnity principle – Yes
29. Barts Health NHS Trust v Hilrie Rose Salmon [2019] – Indemnity principle – Yes . Also note: Once the paying party has established a good reason for a phase they are free to challenge any other sums within that phase without identifying further good reason.
30. Chapman v N&N Uni Hosps NHS FT [2020] – Underspend – No
31. Utting v City College Norwich [2020] - There would need to be very clear evidence of obvious overspending in a particular phase before the court could even begin to entertain arguments that there was a good reason to depart from the budgeted phase figure if the amount spent comes within the budget.
ST v ZY (2022) –
ST v ZY (2022) – importance of informing client of overspend, especially if coming out of damages
