The final countdown
Date: 22 July 2011
Authors: Dominic Regan
Issue: Vol 161, Issue 7475
Categories: Opinion, Costs
The 1st of October 2012 happens to fall on a Monday. Serendipity. This is now the official target date for implementation of the Jackson reform package. Nothing is certain and indeed at the very last moment the much more modest road traffic accident portal regime was postponed by 24 days to allow for fine-tuning in April last year. However, the government is desperate for reform and will do all it can to meet the deadline it has set itself.
Those apparent gaps in the legislation are to be filled by amendments to the Bill so one-way costs shifting is coming. Clause 51 of the Legal Aid Bill empowers the rules committee to bring about drastic changes to my beloved Pt 36, including the 10% damages uplift for a claimant who has been successful lat trial. Sir Rupert Jackson has announced that the troublesome Carver decision will be reversed by Rules of Court to be implemented in October this year.
The news of a judicial review challenge to Jackson was reported in this magazine earlier this month. The essence of the claim is that the adverse impact of making clinical negligence claimants pay their own success fee was not fully investigated and nor did the government fully assess the adverse impact upon this band of litigants. At the party to launch the report Lord Neuberger, with prescient wisdom, said that the research and consultation was done and the debate was firmly over. The world tour by Sir Rupert coupled with the careful analysis of every single written submission made (he read the lot) means that an attempt to derail by judicial review is, in my view, unlikely to succeed. I do regard the removal of legal aid as misguided, to say the least.
Jackson incomplete
Not all work on Jackson is complete. He has decided that it will be a logical extension of costs management to have a thorough look at costs capping early next year and I believe that Jeremy Morgan QC will be instrumental in helping Sir Rupert. Costs capping is rare and complex, involving as it does a form of detailed assessment at the beginning of the case. The poor senior costs judge has found that High Court judges have made capping orders in principle but then allocated the case to him to do the dirty work.
On the other hand, costs management is extending and will be taken further. The successful Birmingham pilot scheme is extended to every mercantile and construction court in October this year and the vision is that ultimately every multi-track case, whatever the subject matter, will be scrutinised with care at the outset with the parties being given thorough guidance as to what steps and expenditure is seen by the court as proportionate or not.
Fixed costs
Lurking in the wings is the implementation of fixed costs in fast-track work and that could be even more seismic if the current track ceiling rises to £50,000 as the government desires. One common myth is that fixed costs will be confined to injury work. While that is where the primary impact will be felt it is the view of Jackson LJ that other areas of practice, such as insolvency, could as easily benefit. He points out that fixed costs will bring two distinct benefits. The first is proportionality, as the scale will dictate what those costs are, regardless of any claim that a vast amount of work was performed at far greater expense. The other perceived benefit will be the eradication of the costs of costs since no detailed assessment will be necessary. Go look at the matrix, for there will be different levels of costs varying with the subject matter of the claim, and that is the end of the costs exercise. While the final report suggested various figures I do not believe them to be definitive.
Portal extension, a policy keenly advocated by Lord Young, is probable in road traffic litigation next year. It is intended to hike the current ceiling from £10,000 to £25,000 and that can be done SSO simply by statutory instrument, as indeed can the introduction of fixed fast-track costs. Incidentally, the portal amendment looks much more dramatic than it is. One major and well respected road traffic insurer told me last month that a negligible number of claims fall within the £10,000-25,000 bracket. Talk of the mass implementation of new portals next year in areas like clinical negligence is utter nonsense. There is no real prospect of change before 2013 for it will necessitate the creation of new forms of claim and that, as we saw even with simple RTA work, is far from easy. It will definitely come, eventually.
Momentum
From the outset Sir Rupert has advocated momentum in implementation, an objective supported now by the Ministry of Justice which was initially lukewarm on change. The need to save money has proved a wonderful incentive to rip up the rules. Jackson has also been insistent that the planks of change be laid together. He was and is adamant that one cannot tinker at the periphery. It all hangs together. For example, fixed costs in fast-track will obviate the need for heavy directions in multi-track work which is sensibly seen as being beyond a rigid, fixed costs approach. It is intended that there should be a single date for switchover and that date is Monday 1 October next year. The countdown has begun.
Professor Dominic Regan provides in-house training on both Pt 36 and Jackson reforms. With thanks to Michael Bacon of the Association of Costs Lawyers.
E-mail: krug79@gmail.com. Website: www.profdominicregan.blogspot.com
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