Solicitors prefer costs management to fixed recoverable costs

Costs management has had a negative impact on litigation but it is still preferable to fixed recoverable costs.

That’s the opinion of the majority of personal injury and commercial litigation solicitors at top 200 firms, according to The Costs Management Survey 2017 by Just Costs Solicitors. Some 90% of personal injury solicitors and 78% of commercial litigation solicitors prefer costs management to fixed recoverable costs.

Phil Bradbury, head of costs management at Just Costs, said: “There’s no love or affection for the process, but it’s better the devil you know.” He said the survey results had also thrown up concerns among the majority of respondents about “a lack of consistency in the judicial approach towards costs management”.

“The lack of guidance as to what proportionate costs means and the fact many judges are still unclear on what basis they are supposed to review the parties’ budgets only serves to heighten their concerns,” he said.

The survey highlighted differing views between the 146 personal injury solicitors and 155 commercial litigators participating about their clients’ preferences. Some 65% of the former said their clients would plump for costs management, while 57% of the latter said their clients would prefer fixed costs.

Bradbury said: “Litigators feel their commercial clients would like to know the risk of financial exposure through involvement in a dispute and potential litigation, whether claiming or defending the matter. 

“The knowledge of a fixed fee would provide clarity and reassurance within the litigation and dispute resolution process, enabling them to make a decision about the best way ahead from the outset.”

Lord Justice Jackson, currently reviewing the case for fixed costs, has recommended extending fixed costs to all civil claims, including personal injury cases up to a value of £250,000. Opponents have warned this could stop solicitors taking on complex low-value cases.

See Dominic Regan interview Jackson LJ on the progress of his review in an exclusive NLJ webinar here.