Firstly, what are Fixed Recoverable Costs (FRC) and who do they apply to?
It is the set amount a successful party in a claim can recover in civil litigation matters and is applicable to claims with a value of up to £100,000.
This does not affect the amount that can be spent on legal fees, merely the amount that can be recovered.
What are the changes and when are they applicable from?
The extension of the FRC is now live and is applicable to all claims from 1 October 2023.
Whereas there were previously three tracks a claim could be allocated to:
- The Small Claims Track (below £10,000 and not a complex matter)
- The Fast Track (between £10,000 and £25,000)
- The Multi-Track (over £25,000 and complex matters)
Due to the FRC changes there is now a new ‘intermediate’ track introduced for claims between £25,000 and £100,000, which will last up-to three days and there are 4 bands within the ‘intermediate’ and ‘fast’ tracks with the lowest FRC in band 1 and highest in band 4.
The intermediate track is the normal track where the claim is brought by one claimant against either one or two defendants, or is brought by two claimants against one defendant.
What does the new FRC extension promote?
Ultimately the key aspects of the FRC extension are:
- Efficiency
- Reduce court workload
- Predictability in recovering costs
These three points are undoubtedly linked, by reducing costs recovered by parties it encourages to act efficiently and try and resolve disputes without the need of overburdening the courts.
A detailed table of fixed recoverable allows those party to a claim to clearly understand what they may be entitled to and provide more clarity than before.
Key points to remember!
Key points to mention are that FRC does not apply where a claim or counterclaim relates in whole or in part to a residential property or dwelling and there is a claim or counterclaim for possession, disrepair, or unlawful of eviction.
There are also penalties for ‘unreasonable behaviour’ with the FRC being reduced/increased by 50% depending on the party deemed to be unreasonable.
Costs on more complex matters are still at the discretion of the court, this may mean that some matters where the claim is less than £100,000 may still be allocated to the multitrack where the FRC rules do not apply.
ULTIMATELY, track allocation is at the discretion of the court.
How we can help you at Ramsdens
At Ramsdens, our specialist and experienced teams can advise you further on any claim you may wish to bring or defend, for more information get in touch.
To speak to our team today, call us on 01484 821 500. Alternatively, email us at info@ramsdens.co.uk or fill out an online contact form to arrange a time for us to call you back.
The above article is for illustrative purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any part of the information given.