MOJ extending fixed recoverable costs

After 4 years of speculation, the government have now confirmed that fixed recoverable costs will be introduced for most civil cases worth up to £25,000 in the fast track. The fast track will be expanded to include ‘intermediate’ cases valued between £25,000 and £100,000 in damages, therefore extending fixed costs to ‘simpler’ valued up to £100,000.

The Ministry of Justice stated that this decision was an attempt to reduce the cost of litigation and create more certainty about what losing parties have to pay. Moving forward, all fast track cases will be allocated to one of four bands of complexity, as set out in rules already applying to some personal injury cases.

The new procedure includes a tougher standpoint on reprimanding parties in delaying the resolution of cases. The government have stated there will be an uplift of 35% of fixed recoverable costs where Part 36 offers are beaten, while there will also be a 50% uplift on fixed costs where one party has engaged in unreasonable behavior.

It was suggested that an example of unreasonable behavior would be an unsuccessful challenge to the allocation of cases to different bands without sufficient basis, however the government does not appear to wish to define further what amounts to unreasonable behavior – case law will provide direction on handling the issue.

Justice minister Lord Wolfson of Tredegar QC stated litigation costs needed reform, particularly those that a losing party has to pay to the winner. This was especially true in lower value claims where businesses are involved and where relatively low damages are at stake.

He added: ‘The case for extending fixed recoverable costs remains strong: uncertainty of costs hinders access to justice, while certainty of costs set at a proportionate and fair level enhances it.’

It will interesting to note whether this reform provides certainty with regards to costs and what further rules the government will submit to the Civil Procedure Rules Committee to continue the attempt to cut costs of litigation and provide clarity with regards to the cost position at the completion of cases.

If yourself or a loved one have a personal injury claim we are here to help. At Ramsdens Solicitors we have an experienced and dedicated Personal Injury team who can help you claim compensation and get you the support you deserve. To discuss a potential claim further you can call us on 01484 821 500, or submit your claim online and we will contact you at your convenience.