Lord Justice Jackson has made another foray into the structure of the civil costs regime by arguing that fixed costs should apply to all claims valued up to £250,000.
Jackson, who was instrumental in implementing the costs reformed that formed part two of the Legal Aid, Sentencing and Punishment of Offenders Act 2012, called on ministers in a speech in Westminster to introduce further reforms to civil costs to set fixed recoverable costs by the end of 2016.
The Legal Aid, Sentencing and Punishment of Offenders Act 2012 introduced a fixed costs regime for personal injury claims of up to £25,000 in value but Jackson is now arguing that the fixed costs regime should be significantly extended, with the aim of covering all types of civil litigation up to a maximum value of £250,000.
In the speech at Westminster LJ Jackson recommended that a new fixed costs regime with certain bands of fees payable, depending upon the value of the work done. For example: £18,750 (less VAT and disbursements) for claims up to £50,000; £30,000 for claims up to £100,000; £47,500 for claims up to £175,000; and £70,250 for claims up to £250,000. He said that a reason behind extending the fixed fees regime was that the experience of practitioners with the fixed fee regime in low-value claims had been ‘satisfactory’ and that the new costs management system (which had previously been introduced by Jackson) was placing the courts under strain.
Jackson proposed limiting the extent of the changes to claims of value up to £250,000, with claims over that limit not being subject to a fixed costs regime. He justified this idea by stating that applying the fixed costs regime to claims over £250,000 “would be too great a change for the profession to accept”.
Lord Justice Jackson also recommended that the Government pause its planning of the introduction of a fixed fee regime for clinical negligence claims, as he believed that introducing a separate costs regime for clinical negligence would lead to a ‘Balkanisation’ of fees for different types of claims.
Chris Hadrill, a solicitor at Redmans, commented on the news: “The new proposals by Lord Justice Jackson appear to signal that the fixed costs regime is here to stay, so lawyers had better get used to it. However, the introduction of fixed costs regime to all types of claims up to £250,000 could cause a variety of unintended consequences, and it appears odd that the system is being extended without a substantive review of the current fixed cost regime (applying to personal injury claims up to a maximum value of £25,000) being undertaken.”
Redmans Solicitors are employment solicitors in Chiswick, Hammersmith, Fulham and Richmond
The original Law Society Gazette article can be found here.
Redmans
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