This article includes: Cost budgeting changes – 6 April 2016; Fixed costs: proposals from Jackson LJ to extend fixed costs regime, and a decision; Lord Justice Briggs – Interim Report on Structure of the Civil Courts; Increased media access to Court of Appeal skeleton arguments

Cost budgeting changes – 6 April 2016

Important changes to cost budgeting were implemented on 6 April 2016 by the Civil Procedure (Amendment) Rules 2016, together with the accompanying document which sets out Practice Direction changes. All the changes apply only to proceedings issued on or after 6 April 2016.

Timing for filing of budgets

The timing for the filing of the costs budget changes (CPR 3.13(1)):

• For lower value claims, up to £50,000, the budget must be filed with the Directions Questionnaire.
• For all other claims it must be filed 21 days before the case management conference.

Budget Discussion Reports

Parties must file an agreed budget discussion report no later than 7 days before the first case management conference (CPR 3.13). Parties are also encouraged to use the Precedent R annexed to the revised PD 3E. PD 3E sets out what should be contained in the budget discussion report:

• Figures which are agreed and not agreed for each phase;
• A brief summary of the grounds of dispute.

Revisions to Precedent H

If the value of the claim is under £50,000, or the costs do not exceed £25,000, only the front page of the Precedent H (costs budget) needs to be exchanged. (PD3E 6b).

Assessment of costs

It is now a requirement to provide the court with a breakdown of the costs claimed in each stage of the proceedings when the court is assessing costs at the end of a case (before any detailed assessment proceedings are commenced).

Application of costs management

There are also new provisions excluding from cost management/budgeting claims made on behalf of a child, or where the claimant has a limited or severely impaired life expectancy. (CPR3.12(1)(c) and PD 3E)).

How will the changes affect cost budgeting?

1. The date when a costs budget is to be filed is now certain – It was not clear under the old rules.

2. Parties must now attempt to agree the new Precedent R (budget discussion report) and file it 7 days before the first case management conference. If figures cannot be agreed that must be set out in the report. (CPR 3.13).

3. The court will not look at the detail in the budget, only the hourly figure. (PD3E 7.10)

Author: Rebecca Dennehy

Fixed costs: proposals from Jackson LJ to extend fixed costs regime, and a decision

The Court of Appeal has recently considered and resolved the interplay between the rules for fixed recoverable costs for low value personal injury claims (Part 45 IIIA CPR) and the provisions of Part 36. It held that the tension between CPR 45.29B and CPR 36.14A had to be resolved in favour of CPR 36.14.

A few weeks earlier, in the IPA Annual Lecture in January, Jackson LJ set out his strong recommendations for the introduction of fixed costs for all civil claims up to the value of £250,000.

CPR 36 and CPR 45.29C

Part 36 allows a claimant to recover assessed costs on the indemnity basis where it obtains judgment against the defendant which is at least as advantageous as the sum offered by the claimant to settle the claim under Part 36. But there is a fixed recoverable costs regime for lower value personal injury cases (CPR Part 45 IIIA).

The decision in Broadhurst v Tan and Taylor v Smith [2016] EWCA Civ 94 concerned Part 36 offers made before 6 April 2015, but the position after 6 April 2015 is the same. The Court of Appeal held that claimants whose claims fall within the fixed costs regime and who beat their Part 36 offers at trial will become entitled to the enhancements in old CPR 36.14 (now CPR 36.17) including indemnity costs.

The Court of Appeal overturned the lower court's decision. They held that as a matter of strict interpretation of the CPR this was the correct outcome, but it also accorded with the general policy of encouraging settlement.

The future of fixed costs?

Jackson LJ has urged the government to adopt a policy of permitting only fixed cost recovery in all types of claim worth up to £250,000; alternatively such a regime could apply to all claims with no ceiling as to value, he said. He has presented a grid of recommended fixed costs reflecting the 10 stages contained in (cost budgeting) Precedent H. According to his grid, claims should be divided into four different bands which would be stepped in value.

What does this mean?

The Court of Appeal has found that the current fixed costs regime for low value personal injury claims will be overridden by Part 36, so indemnity costs can still be awarded. This means that claimants should be strongly advised to make early Part 36 offers with a view to escaping the regime.

There are, of course, other fixed recoverable cost regimes in place in the CPR: an example is the scale costs regime for claims in the Intellectual Property Enterprise Court (IPEC). That regime does not appear to allow Part 36 to trump its provisions.

Whether any new, extended, fixed costs regime should allow either or both claimant or defendant to exit the regime if they make successful Part 36 offers will no doubt be a topic for comment in any consultation on new draft fixed costs rules. Jackson LJ is hopeful that both consultation and rule making could be completed during the course of 2016, which is perhaps an optimistic timescale.

Author: April Miles

Lord Justice Briggs – Interim Report on Structure of the Civil Courts

Background

In the Summer of 2015 Briggs LJ was asked to review the structure of the civil courts in England and Wales. His review is to be completed by the end of July 2016. He published an interim report ("Report") on 12 January 2016.

The Report covers a wide range of topics. This update looks how it may affect commercial litigation.

Online Court

The introduction of an Online Court is proposed. This would take the court system into a completely new direction. The current proposal is to limit the Online Court to claims worth £25,000 or below, but some commentators have observed that, if successful, such a system could eventually encompass higher value claims too.

Rights and routes of appeal

With a 54% increase of incoming work in the last six years, LJ Briggs is rightly concerned with the current burden on the Court of Appeal ("CA"). He summarises a number of possible solutions:

• Increase the CA's resources by employing more judicial assistants or for High Court judges to sit part time in the CA. However, this could mean the burden of work merely shifting to High Court judges;
• Reduce the CA's workload, with suggestions of making it a second tier of appeal only (save for first instances decisions from the High Court);
• Improve the CA's efficiency with a more focused use of judicial assistants and shorter written submissions to appeal; and
• Deliberately reducing the quantity or quality of the service.
• Enforcement procedures

Briggs LJ indicates that the pending digitisation of the Court Service could lead the way in rethinking enforcement procedures: High Court judgments need not necessarily be enforced in the High Court - there is a case for unification of enforcement procedures across all courts. He suggests that the strengths of each of the current enforcement processes be identified.

Summary

All these proposed change may in due course have an impact on commercial litigation. Speeding up the appeal process and making enforcement more efficient would be very welcome. Although an Online Court could save both the parties involved and the judicial system a huge amount of cost, it seems unlikely (and undesirable) that it should be used for anything but the most straightforward claims.

Author: Sam Yazdani

Increased media access to Court of Appeal skeleton arguments

Summary

On 6 April 2016, a new provision in PD 52C of the CPR gives accredited law reporters and members of the media access to skeleton arguments (anonymised for proceedings involving a child) prior to the commencement of hearings in the Court of Appeal.

Background

Accredited court reporters have long lobbied for increased access to court materials to enable more accurate reporting of proceedings. The difficulties were, they argued, most pronounced at final hearings in the Court of Appeal Civil Division, where there is a heavy reliance on written submissions and little in the way of oral evidence.

Before the rule change reporters were dependant on the co-operation of the parties in order to obtain the documents required to fully understand the proceedings. They sought access to:

• Claim forms, particulars of claim and notices of appeal;
• Skeleton arguments;
• Judgments under appeal; and
• Witness statements.

The issue of media access to court documents had been considered in 2012 by the Court of Appeal in R (Guardian News and Media Limited) v City of Westminster Magistrates' Court [2012] EWCA Civ 420, [2013] QB 618.

In that case it was held that the court had the power to determine whether the disclosure of skeleton arguments, and other such documents, was necessary to give effect to the principle of open justice.

Toulson LJ, said: "The court has to carry out a proportionality exercise which will be fact-specific. Central to the court's evaluation will be the purpose of the open justice principle, the potential value of the material in advancing that purpose and, conversely, any risk of harm which access to the documents may cause to the legitimate interests of others."

The new approach

After consideration and consultation the Civil Procedure Rule Committee concluded that skeleton arguments were the only class of document for which a strong case could be made in favour of increased media access.

The new Rule, entitled: "Documents to be provided to court reporters at the hearing of an appeal", provides that:

(1) a legal representative must bring to the appeal hearing two additional copies of the party’s skeleton argument for accredited law and media reporters.

(2) In appeals in family proceedings involving a child, the copies of the skeleton argument must be in anonymised form and must omit any detail that might, if reported, lead to the identification of the child.

(3) The skeleton arguments must be supplied before the commencement of the hearing to the usher or other court official who must provide one copy to an accredited law reporter and one to an accredited media reporter if requested. The copies are provided only for the purpose of reporting the court proceedings and on the basis that the recipients may remove them from the court and make further copies of them for distribution to other accredited reporters in court, again only for the purpose of reporting the court proceedings.

(5) Any party may apply orally at the commencement of the hearing for a direction lifting or varying the obligations to provide copy skeleton arguments and the rule lists the particular considerations to which the court will have regard on such an application (the interests of justice; the public interest; the protection of the interests of any child, vulnerable adult or protected party; the protection of the identity of any person intended to be protected by an order or direction relating to anonymity; and the nature of any private or confidential information (including information relating to personal financial matters) in the document.

There is no equivalent provision relating to skeleton arguments for first instance applications or trials. Those are not routinely kept on the court file in the High Court, so court reporters must still seek the assistance of the parties or their legal representatives if they want to see copies.

Author: Oliver Millerchip