Jackson LJ is continuing his enquiries into extending the fixed costs regime and to this end he recently chaired a fixed recoverable costs seminar in Birmingham on 16 March 2017. There were four speakers at the conference at the conference who offered their views on the proposals to extend the fixed costs regime; His Honour Judge David Waksman QC of the London Mercantile Court, Ed Pepperall QC of the Commercial Bar Association, John Hughes, President of the Birmingham Law Society and Isabel Hitching of the Technology and Construction Bar Association.
Outline details of a proposed two-year fixed costs pilot scheme which is currently being developed by a fixed costs working group were provided. However, it was emphasised that the pilot is still very much a proposal, and subject to the approval of the Civil Procedure Rule Committee. If approved the pilot scheme will run in the Mercantile Court in London and in Manchester in the Chancery Division and Technology and Construction Court as well as the Mercantile Court.
It is intended that the pilot will start within the next three months, the purpose of it being to see how extending fixed costs would work in practice and also to see what appetite there is for the scheme amongst practitioners as participation in the scheme would be voluntary. The scheme is intended to combine “an appropriately truncated procedure” with “robust and rigorous” case management and will include scale costs for each phase of the litigation, but these will be caps rather than fixed costs and the recoverable costs will be subject to an overall cap. It is expected that the scheme will apply to claims with a value of up to £250,000.00.
At the seminar the Commercial Bar Association confirmed that their view is that fixed costs should not be extended into the Multi Track or in the alternative that they should only be extended to cases with a value of less than £50,000.00, with a Trial length of less than two days and where no expert evidence is required. If fixed costs are extended beyond this then the Bar Association’s position is that this must be done on a bespoke basis as business cases are too variable to support a Rule that all cases up to a certain value must fall within the regime. Arguably, this could equally be said of clinical negligence claims which also vary dramatically.
This was a view largely shared by the Birmingham Law Society whose position was that fixed costs may work if limited to relatively low value and non-complex cases. They confirmed that they are broadly in favour of the extension of fixed costs but that they continue to have concerns regarding the practicalities of the same. In particular they are concerned that practitioners may engage in aggressive litigation in order to trigger the next fee stage, that fixed fee work requires a streamlined process and experienced Judges and there are a shortage of Judges at present and also that firms may have to work at a loss, charge an additional fee to clients outside of the fixed fee regime or may have to turn work away altogether.
It is clear that the extension of the fixed costs remains a highly controversial topic. Some accept that it may have a place in lower value, non-complex claims though it is clear that there are concerns that extending the fixed costs regime significantly beyond this may undermine access to justice. Hopefully this pilot scheme will determine whether or not an extension of the fixed costs scheme would work in practical terms and if so, the extent to which it ought to be extended so as to ensure that it has a positive rather than negative impact on the civil litigation system.