A year ago, Bradley Meads, a Costs Lawyer and senior associate at Kain Knight, co-authored an article concerning the Precedent AA bill of costs, having acted in the first case involving it at the Senior Courts Costs Office (SCCO). A great deal has happened since then, as he explains below.
I have been a member of the ACL’s working party on the implementation of J-Codes since its inception in May 2015. This role was expanded to include the implementation, and then development, of a new format bill of costs. I also co-authored both Kain Knight’s and the ACL’s responses to the Hutton committee’s electronic bill of costs – now Precedent AB.
The ACL working party produced an interim version of the bill of costs, which was intended to be adaptable, much in the same way that is provided for by the current CPR 47.6 PD 5 but without the professional level knowledge of excel required by Precedent AA. We presented our electronic bill of costs to the ACL National Conference as well as various other stakeholders, including the Senior Costs Judge and the Law Society, with a view to incorporating any feedback in to a refined bill of costs.
On 29 September 2016, the SCCO pilot scheme was radically changed; providing a date that an electronic format Bill of Costs would become mandatory as of October 2017. There was also a new precedent Bill of Costs in the form of Precedent AB. Crucially, the revised pilot scheme expanded the format that any electronic bill of costs could take.
Providing that it reported and aggregated costs on the phase, tasks, activities and expenses, produced the requisite summaries, automatically recalculated if input data was changed and, as proposed by the ACL, allowed any spreadsheet based Bill of Costs which produced these four outcomes, it would prove to be acceptable.
Moreover, J-Codes had been replaced with schedule 1 codes, which to my mind are all but identical save that they are now a non-exhaustive list and allow the end user to adapt as they see fit.
Needless to say, further revisions were required to the ACL’s bill of costs to make it compliant. I shall return to this later.
Around April 2016, I took instructions to prepare a costs budget for an international shipping and distribution firm. After preparing the costs budget and attending at the case and costs management conference (CCMC) on liability, I proposed that I managed their costs going forward – a cost which is permitted within CPR 3.12 PD3E 7.2(b). I duly attended a further CCMC on liability and quantum, which was heard a couple of months later. During the course of the substantive proceedings, I provided my client with fortnightly updates on their costs expenditure both on an inter partes basis as well as on a solicitor and client basis.
After the substantive proceedings successfully concluded last autumn, and being aware of the impending revisions to PD51L 1.1A(b), I recommended to my client that I prepare the bill of costs not in line with CPR 47.6 PD 5 but rather in accordance with Practice Direction 51L.
The reasons were three-fold: firstly, I considered that, because I had costs managed the case throughout, it would be quicker process; secondly, given that there were interim statute bills and multiple phases (including divisions for liability and quantum), preparing a bill of costs in the Precedent A CPR 47.6 PD 5 format would be cumbersome; and thirdly, as alluded to above, I believed that an expedited listing for any subsequent detailed assessment hearing would be achieved.
So, did costs managing the case assist me in this process? Was preparing the bill of costs quicker and less cumbersome? And did we achieve an expedited hearing? Quite simply, yes. I shall deal with each in turn.
Managing costs throughout the substantive proceedings enabled me to avoid the exercise of phasing each item of costs. Consequently, I was left with the remainder of the schedule 1 codes i.e. task, activity and disbursement type. Where necessary, I also needed to allocate each item to a party as well as identify the communication type – which was not highlighted when the Precedent AB or schedule 1 codes were released.
Addressing all of these steps may have turned the entire process back in to an ineffective and inefficient one. However, I developed a hybrid bill of costs with assistance from Carl Bird, an associate at Kain Knight’s London office. The hybrid version is based predominantly on Precedent AB, but with certain aspects of the ACL’s interim bill as well as various formulae which sped up preparation to the point of making the whole process viable.
The bill of costs and points of dispute were served in January 2017. Replies were served in February. A short stay for negotiations ensued but, regrettably, these broke down. I personally filed at the SCCO the request for detailed assessment hearing and its accompanying bundle in March. The notice of hearing was received in April, listing the matter for one day in May, two days in June and three days in August. Having worked in costs for the best part of a decade, I am certain that such expedited time frames are almost unheard of.
Prior to the May hearing, the defendant accepted our part 36 offer, albeit out of time. I firmly believe that using the pilot scheme benefited my client by achieving an earlier hearing date, resulting in applied pressure being placed on the defendant.
A further question does, however, come to mind: did the extra transparency provided by a spreadsheet bill of costs assist in the quick resolution of these detailed assessment proceedings? This remains to be seen. What is certain is that (a) there is more detail in the bill and (b) that data is maneuverable by either party, neither of which was possible before.
The offshoot of this is that it allows either party to make submissions in points of dispute, the reply thereto and possibly at the final hearing in a completely new way and perhaps at a far greater scale. This was undoubtedly the impression that I got back in May 2016 when I opposed the Precedent AA bill as referred to earlier.
Going full circle, the ACL (through the working party) has now made further representations to the CPRC’s sub-committee, which deals with the pilot scheme and bill of costs. It urged the chair of the sub-committee to adopt Practice Direction 51L as it is, specifically concerning the use of any format of spreadsheet.
As was reported last week, this appears to have been successful but we await publication of the new rules in full.