Costs budget woes

Lawyers need to be more active in applying to vary costs budgets, a leading judge has said.

Speaking at an Association of Costs Lawyers (ACL) roundtable of judges and practitioners to mark two years of costs management, District Judge Chris Lethem said he “hardly ever” saw applications to vary budgets.

Judge Lethem, a member of the Civil Procedure Rule Committee and Judicial College trainer on costs, says: “I am deeply uneasy about that desert of applications, because either I have achieved a crystal vision which I thought I did not possess, or the parties are storing up a heap of problems later on down the line because they did not apply to vary, and when they get to the end of the process they are suddenly going to find they have overspent.”

However, Francesca Kaye, partner at Russell-Cooke, says: “The risk of making an application to amend or vary a budget is firstly that the proposed amendment, depending on why you are applying to amend, might not be allowed; secondly, we have heard some horror stories of making an application to amend, and the judge taking one look at the budget that previously had been granted, and taking it as an opportunity to have another go at it.”

The consensus was that it is mainly smaller firms that struggle with budgets, with some still not filing on time or, as Judge Margaret Langley says, filing budgets that look like they’ve been “done on the back of an envelope”. The participants also swapped anecdotal tales of district judges refusing to budget cases where liability was admitted or delaying budgeting in the expectation of a settlement.

ACL chairman Sue Nash says: “There is still a considerable way to go before we fully understand the best way to approach every aspect of costs management.”