Disputes (Case Management)

Question 1

What are Solicitor-Client Costs?

Answer 1

Costs payable by client to solicitor under the contract.

If a party is successful in litigation, they will seek an order that the other party pay their legal costs. However, there is usually a shortfall between the sum recovered and the sum payable to the solicitor.

Question 2

When calculating the value of a claim, is VAT included?

For example if a claim is £108,000 (inclusive of £180000) VAT.

Answer 2

Yes you do not need to disregard the Vat.

The value is £108,000 and therefore issue in either county court or high court dpeneding on complexity.

Question 3

What are Inter-Party Costs?

Answer 3

Actual figure for costs **awarded by the court **which one party has to pay the other party.

Question 4

What are Non-Party Costs?

Answer 4

The court has jurisdiction to award costs against a non-party, such as a funder funding the litigation.

Question 5

What is the general rule for costs in litigation?

Answer 5

Costs follow the event - the unsuccessful party pays the costs of the successful party per CPR 44.2(2)(a), although the court has complete discretion.

Question 6

What does the Basic Assessment Rule require when the court makes a cost order?

Answer 6

The court must specify the basis of the assessment, which can be Standard Basis or Indemnity Basis.

Question 7

What is the Standard Basis of cost recovery?

Answer 7

• Proportionate and reasonable in amount
• Any doubt resolved in favour of the paying party

Common for only 60% legal costs to be recovered by the receiving party from the paying party

Question 8

What is the Indemnity Basis of cost recovery?

Answer 8

• Costs must have been reasonably incurred and reasonable in amount,
• Any doubt resolved in favor of the receiving party.

Commonly, 70-80% of legal costs are recovered by the receiving party from the paying party

Question 9

What is the time frame for complying with an order for payment of costs?

Answer 9

Unless otherwise ordered by the court, a party must comply within 14 days of the judgment or order or the date of the certificate stating the amount.

Question 10

What are Fixed Costs in litigation?

Answer 10

Fixed costs apply to small claims, fast, and intermediate track cases, with complexity bands determining the amount of fixed costs to be recovered.

Question 11

What are Assessed Costs?

Answer 11

Costs that require the court’s involvement to decide and calculate the amount payable, through Summary Assessment or Detailed Assessment.

Question 12

What is Summary Assessment?

Answer 12

A procedure where the court decides costs at the end of the hearing, requiring parties to prepare and file a statement of costs (NS60 Form) less than 24 hours before the hearing.

Question 13

What is Detailed Assessment?

Answer 13

When the court orders detailed assessment if the costs are not agreed, the receiving party serves a notice of commencement and a bill on the paying party.

Points in dispute should be served within 21 days. If no agreement is reached, they can request a costs hearing.

Question 14

What are Interim Costs?

Answer 14

Costs considered at the end of any interim hearing; the court decides by whom and to what extent costs are to be paid.

Question 15

What does ‘Costs in any event’ mean?

Answer 15

The party in whose favor the interim order is made is awarded costs of that hearing, regardless of the trial outcome.

Remember, in any event means ‘regardless of anything else’

Question 16

What does ‘Costs in the case’ mean?

Answer 16

The party who eventually gets costs at trial will recover costs of the interim hearing.

Question 17

What are Costs reserved?

Answer 17

The decision on costs is delayed to a later occasion.

Question 18

What are ‘Costs thrown away’?

Answer 18

If a judgment or order is set aside, the party in whose favor this cost order is made is entitled to the costs incurred.

Put another way, a specific costs incurred in relation to a judgment or order which is later set aside, and which the successful party is entitled to be repaid

Question 19

What does Qualified One Way Cost Shifting (QOCS) entail?

Answer 19

QOCS restricts cost orders against claimants who lose in personal injury or death claims, limiting recovery to the level of damages and interest awarded. This is usually £0 since they lose.

Question 20

What are exceptions to the QOCS regime?

Answer 20

QOCS will not apply if proceedings are struck out for lack of reasonable grounds, abuse of court process, or obstructive conduct by the claimant.

Question 21

What are the court’s general case management powers?

Answer 21

• Extend/shorten compliance times
• Adjourn hearings
• Require attendance
• Stay proceedings

Question 22

What grounds can the court use to strike out a statement of case?

Answer 22

The court may exercise its power to strike out the whole or part of a statement of case of its own initiative or on the application of a party (CPR 3.4)

Grounds for strike out:

• Statement of Case discloses no reasonable grounds for bringing or defending a claim
• The statement of case is an abuse of court process or obstructs the just disposal of proceedings
• There has been failure to comply with a rule, PD or order.

Question 23

What are sanctions in case management?

Answer 23

Measures imposed to ensure compliance with court orders and rules, which can be automatic upon non-compliance.

Question 24

What types of sanctions can the court impose?

Answer 24

• Interest reductions
• Costs orders
• Striking out statements of case

Question 25

What is the general rule regarding time limits?

Answer 25

Time specified by the CPR or court order may be varied by written agreement of parties.

However, where a rule or order requires a party to do something within a specified time; and specified the consequences of failure to comply, the time may not be extended by agreement except that the parties agree an extension of time by prior written agreement (before the deadline) for a maximum of 28 days provided this does not risk any hearing date

Question 26

What test does the court apply for granting relief from sanctions?

Answer 26

Denton test

1. If the breach is neither serious or significant, the relief should be granted
2. If the breach is serious or significant, consider why the default occurred
3. 3. Having considered the reasons, the court should evaluate them in the circumstances of the case and ensure the court deals justly but with particular weight given to CPR 3.9 that (a) litigation must be conducted efficiently and at proportionate cost; and (b) the court must enforce compliance with rules, practice directions and orders.

Question 27

What are the four tracks cases can be allocated to?

Answer 27

• Small Claims Track
• Fast Track
• Intermediate Track
• Multi-Track

Question 28

What is the Small Claims Track limit?

Answer 28

Typically cases with a value of no more than £10,000.

Special rules for personal injury claims

Question 29

What defines the Fast Track?

Answer 29

• Cases up to £25,000
• Trials lasting no longer than one day
• Each party can have one expert per field, max two fields (4 total)

Question 30

What defines the Intermediate Track?

Answer 30

• Cases up to £100,000
• Trials likely to last no longer than three days
• Oral expert evidence is limited to two experts per party

Question 31

What cases are on the multi-track?

Answer 31

All other types of case

• £100,000 +
• Trial longer than 3 days
• Multiple witnesses (more than 4 total(

Question 32

What is the purpose of the Notice of Proposed Allocation?

Answer 32

To provisionally decide the track most suitable after receipt of a defence, requiring parties to file a directions questionnaire.

Question 33

What is the purpose of a Directions Questionnaire?

Answer 33

Parties must complete Form N180 for small claims, and Form N181 for all other tracks.

To provide the court with necessary information to allocate the case and ensure parties have prepared adequately.

Question 34

What does the court do after receiving the Directions Questionnaire?

Answer 34

Allocate the claim and assign a complexity band for intermediate or fast track cases.

Question 35

What is the overview of the Small Claims Track?

Answer 35

• Very Limited Cost Recovery - Rarely orders one party to pay any costs to the other party, other than limited fixed costs
• Fewer formalities - Encourages litigants to self-represent
• Parties are required file and serve on every other party copies of documents they intend to rely upon no later than 14 days before the main hearing.

Question 36

What are the standard directions for the Fast Track?

Answer 36

• Disclosure ( 4 weeks of notice)
• Exchange witness statements (10)
• Exchange expert reports ( 14 )
• Filing Pre-Trail Checklists ( 22 )
• Trail date ( 30 )

Question 37

What is the purpose of the Case Management Conference (CMC)?

Answer 37

To identify issues, discuss compliance, and estimate litigation costs, ensuring legal representatives are familiar with the case.

Question 39

When must the disclosure report and DQ be filed before CMC?

Answer 39

File 14 days before CMC

Question 40

When must the draft directon be filed before CMC?

Answer 40

At least 7 days before CMC

Question 41

What is the Cost Management Regime (CMR)?

Answer 41

Allows courts to make Cost Management Orders

Question 42

When does the CM Regime apply?

Answer 42

All cases except…

• Small claims
• Fast Track Claims
• Intermediate track Claims
• Claims where the amount is for £10 million or more
• Claims made by persons under the age of 18 (e.g using litigation friend)
• Claims subject to fixed costs or scale costs

For example, if there is a litigant in person, this doesn’t stop the CM applying to all parties. All parties except litigants in person must file and exchange budgets as at CPR 3.13(1).

Question 43

What is involved in preparing cost budgets?

Answer 43

• Estimate future costs
• File and exchange budgets 21 days before CMC
• Discuss any agreement on costs.

Question 44

What are Budget Discussion Reports?

Answer 44

• Record extent to which parties agree on budgets
• Filed and exchanged 7 days before the first CMC.B
• Budget and Budget Discussion reports considered by the court
• The court will then (psot CMC) either make a cost management order = provisional indication of what should be considered reasonable and proportionate costs in any later assessment period.

Question 45

What happens if a cost budget is not filed?

Answer 45

Automatically treated as having filed a budget comprising only court fees, significantly limiting potential recoveries.

Question 46

How do CFAs work?

Answer 46

• The CFA will set out a percentage for the success fee that, if the client wins in court, will be payable from the law firms basic costs.

If the CFA success fee is 50%, and the basic costs are £100,000 - the solicitor will get £150,000 (£100,000 basic costs + £50,000 success fee…)

• CFA doesn’t impact the damages awarded, nor any party costs.

There is a risk, because if the client loses they won’t pay client costs (solicitor gets nothing) but the client will have to pay party costs

Sometimes coupled with ATE insurance so that if the client lose, insurance pays the court fees, counsel fees and disbursements. But there is a large excess.

Question 47

What is a Damage Based Agreement (DBA)?

Answer 47

• The solicitor’s legal fees are only payable in the event that the instruction is successful.
• A solicitor will be paid a percentage sum of the damages recovered for the client from the losing party.

Question 48

When considering the value of the claim, is an admitted amount included?

For example, the value of the claim is £36,000, which includes a claim for interest of £6,000. In the defence, the defendant has admitted that he owes the claimant £25,000 but the rest of the claim, including the claim for interest, is denied. What is the value for allocation?

Answer 48

Amount admitted are excluded from the value, as is interest.

(£36,000 – £25,000 – £6,000 = £5,000) which is half the small claims threshold of not more than £10,000

Question 49

Can you vary the date of a CMC? How?

Answer 49

Yes.

A party must apply to the court if they wish to vary the date which the court has fixed for a CMC.

Question 50

If a judge is unhappy with the parties attempts to settle, what is the usual order at a case management conference?

Answer 50

The claim may be stayed for a period of one month for the parties to try to settle the dispute by ADR or other means. correct

Question 51

Can the court use strike out powers on their own initiative?

If so, must parties be allowed to make representations?

Answer 51

Yes, as the judge may exercise powers of their own initiative.

They may do so without giving the parties an opportunity to make representations providing that there are no reasonable grounds for bringing the claim or it is an abuse of the court’s process.

Question 52

What is the effect of an unless order?

Answer 52

When the court makes an order it may specify the consequence of failure to comply with it which may mean a case will be struck out at a future date unless the party carries out a specific step by that date

Question 53

Before striking out a defence for failure to comply with a deadline, what is the usual order the court begins with?

Answer 53

Although the court may strike out the defence, typically the court will issue an unless order first, giving the non-compliant party a final chance to comply before taking the step of striking out the case.

Question 54

Can the parties agree in writing to a variation of time for filing the pre-trial checklist?

Answer 54

No

CPR 28.3 provides that the parties would have to apply to the court if they wish to vary the dates for a number of timetabled steps including filing the pre-trial checklist.

Question 55

For a statement of truth verified by an officer of the company, should it state “I believe…” or “ I am duly authorised by the Claimant to sign these particulars of claim. I understand…”

Answer 55

“I believe that the facts stated in these particulars of claim are true. I understand that proceedings for contempt of court may be brought against anyone who makes, or causes to be made, a false statement in a document verified by a statement of truth without an honest belief in its truth.”

Question 56

If an amount is admitted, is the included in the value of the claim when deciding where to issue?

Answer 56

No

Exclude admitted amounts

Question 57

Can you vary the date of a CMC by agreement with the other side?

Answer 57

No

You must apply to court for a variation of a CMC date

Question 58

If an additional claim is commenced (e,.g. for contribution/indemnity) but the ‘main’ claim ceases (e.g. settles or strike out) does the ‘additional’ claim also end?

Answer 58

It depends if damages are also part of the additional claim…

• If the claim is solely for a contribution or indemnity, that stands or falls with the main claim as, if the claimant is unsuccessful, there is no need for a contribution or indemnity.
• If the additional claim includes a claim for damages, the claim for damages, which is the separate to the claim between the original claimant and defendant, can continue against the subcontractor.

Question 59

When the court makes an unless order, when is a case struck out?

Answer 59

If the party fails to comply, the defence is struck out.

There is no need to apply to the court.

Question 60

How can you vary the date for filing a pre-trial checklist?

Answer 60

Parties must apply to the court

Agreement isn’t sufficient.