The emergence of a fixed costs regime could take a significant step forward next month with the start of a two-year pilot.
The Civil Procedure Rule Committee today indicated there is likely to be a new practice direction update effective from 14 January which sets up the extension of fixed costs.
The capped cost pilot scheme will apply to cases valued at up to £250,000. Participation is voluntary and the pilot will function in the Business and Property Courts in Leeds and Manchester (Chancery, Circuit Commercial and the Technology and Construction Court) and the London Circuit Commercial Court.
The pilot derives from Sir Rupert Jackson’s costs review, published in summer 2017, which recommended the roll-out of fixed costs for civil cases. Jackson, who described his proposals as ‘unfinished business’ following his previous civil justice review, advised there should be a pilot of capped recoverable costs, in conjunction with streamlined procedures, for business and property cases with a value up to £250,000. But progress on this has since stalled, despite Jackson stating that draft rules were already approved by the Civil Procedure Rule Committee.
Although figures are not confirmed at this stage, Jackson envisaged streamlining procedures and capping recoverable costs at £80,000. Details are still subject to change and, ultimately, parliamentary approval.
The former Court of Appeal judge recommended that if the pilot was successful, such a regime should be made available at the judge’s discretion for any suitable case in the Business and Property Courts or the business and property lists of the county court.
Jackson said this change would help small and medium-sized enterprises secure access to justice: he cited the Federation of Small Businesses, which called for a reduction in legal costs.
In the aftermath of the second Jackson report there were warnings that it could take years to implement his recommendations. In January 2016 Jackson had proposed fixed costs for all cases worth up to £250,000. This ambition was reined in by the time of the final report, but there have still been few signs of a new regime being implemented.