The Ministry of Justice has confirmed that fixed recoverable costs will not be extended until October next year.
In a speech to the Civil Justice Council national forum today, Lord Bellamy said the government wanted to give the legal sector more time to adjust to the new regime. The plan had been to extend fixed costs from April but it has proved logistically difficult to redraft the rules in time.
Bellamy said: 'Extending FRCs requires an extremely complex set of reforms… So I’d like to offer my sincere thanks to the CPRC, and its costs sub-committee, chaired by Mr Justice Trower, for its tireless work here. I know it hasn’t been an easy task. I know that these reforms have particular implications for housing cases, and I am grateful for the constructive input of housing providers which we continue to consider.
'Progress has been made, and we hope the rules will be approved in the near future. But we’re also very conscious of how important it is to get this right.'
Rule-makers and MoJ officials have continued to work towards the April deadline and the Civil Procedure Rule Committee had been due to sign off the changes at its meeting next month.
The plans have proved controversial since they were announced by the government in September 2021 in response to a 2019 consultation paper on implementing recommendations from Sir Rupert Jackson.
The proposals are to extend FRC to most civil cases valued up to £100,000 (clinical negligence claims are being considered separately). Initially the plan was to expand the fast track to include ‘intermediate’ cases but it emerged last week that the government would adopt Jackson’s recommendation for a new intermediate track.
Ministers have said that fixed costs will give both parties certainty about the amounts they will have to pay if they are unsuccessful, and will ensure costs are proportionate. Critics say the proposals risk driving lawyers out of civil justice work if the costs are too low and will leave litigants to represent themselves.
News of the delay has been welcomed by industry insiders.
Matthew Maxwell Scott, executive director at the claimant-focused Association of Consumer Support Organisations, said the postponement gave practitioners ‘breathing space’ to get full prepared for the change.
He added: ‘We hope that this welcome delay will allow more time for the Ministry of Justice and rule committee to agree a sensible regime that is future proofed, giving certainty and stability to law firms wishing to continue to work in this market.’
Matthew Currie, chief legal officer for Yorkshire firm Minster Law said: ‘We warmly welcome this delay, if the net effect is a more considered and sensible approach to fixed costs going forward, including a regular review mechanism to ensure costs reflect inflation.
‘After a period of turmoil in the sector, driven by reform and external macro factors, we need a period of stability and certainty, so that we can plan effectively to manage the needs of our clients in the post reform world.’
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