Page 9 - PIC Magazine Issue 21
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 Intriguingly there is no indication of what this lighter touch budgeting would involve; whether costs budgeting might be dispensed with altogether in more cases, or whether it would
be retained as at present, but with judges encouraged to take a more broad brush approach to it. However, one suggestion made by the majority of the group is that the provision of directions and of budgeting should be staged, rather than, as now, taking place simultaneously (para.1.23):
What is suggested is that if a hearing was required for a case management conference alone, for example where directions are highly contentious and could result in very divergent budgetary assumptions, costs management could follow, shortly after the directions had been ordered.
The working group recommended that a pilot scheme should be initiated in order to determine whether directions and budgeting should continue to be considered together, or uncoupled so
that budgeting could be considered later in the litigation process.
The Arguments for and Against
Budgeting Later in Proceedings
The putative advantages of this approach are set out in the report:
a) Because directions hearings require shorter time estimate than full CCMCs, listing would be quicker, and directions could be given at a much earlier stage in the litigation.
b) This could save some time and costs of budget preparation, because the assumptions on which the budget would rest would be clear.
c) This in turn could lead to more agreement on budgets, which would benefit the parties and the court.
d) Ultimately it is hoped that some budgeting hearings could be done away with altogether as a result.
In addition:
e) Often parties are able to agree directions but not budgets. Under the present regime there is no encouragement to action the agreed directions prior to the CCMC hearing,and indeed because this would lead the parties to incur unbudgeted costs, there is discouragement from doing so. This leads to delay in the litigation process.
f) The elision of directions and budgeting conveys the impression that the civil justice system places equal importance on doing justice between the parties and on costs. This arguably brings the system into disrepute amongst litigants, in particular consumers and claimants in personal injury claims.
On the other hand, the report notes some disadvantages of uncoupling direction from budgeting:
a) Most obviously, if no costs information is provided at
the directions stage, it is difficult for the judge giving directions to determine whether any particular step is proportionate, especially in respect of expert evidence. For this reason it is proposed that some costs information is made available at the directions stage. If this information is to be provided, might it not be more
cost effective simply to provide budgets?
b) In some courts combining directions and budgeting does not lead to delay, either because all hearings, no matter the time estimate, are taking a very long time to list, or because no such delays exist.
c) Where there is significant delay in listing, uncoupling directions and budgeting will mean that parties will incur substantial unbudgeted costs in carrying out the court’s directions prior to the budgeting hearing. Could this be a charter for parties, and in particular claimants in personal injury cases to which QOCS applies, to rack up costs in an undisciplined manner without any oversight on the part of the court? The Review suggests (para.1.24) that this concern could be dealt with by providing the courts with the power to undertake some limited retrospective budgeting of costs incurred between the two hearings.
d) This method of dealing with CCMCs would allow for different judges with different expertise to determine directions and budgeting respectively, enabling a costs judge to consider costs, and allowing those judges without such expertise to deal with directions.
Ever since costs budgeting was first introduced, there has been a tension between the importance to be given to directions and the prominence budgeting ought to have, with some judges budgeting before making decisions on directions, giving rise to the absurd result (for example) that the expert phase might be budgeted before any decision taken on whether the parties should have permission to rely on experts at all. It is suggested that the proposal that directions should be dealt with first is to be welcomed; quite apart from the logistical arguments in favour of doing so, it is a useful reminder to judges that the primary role of the civil justice system is, as it should be, to do justice between the parties. Autumn & Winter 2023 PARTNERS IN COSTS 9

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