Master of the Rolls approves new guideline hourly rates from 1 October

The Master of the Rolls, Sir Geoffrey Vos (pictured), approved the new guideline hourly rates (GHR) earlier this month and the High Court has already used them in a summary assessment, even though they do not come into force until 1 October.

Sir Geoffrey has also ordered a further review of the GHR that will take changing working practices into account.

The revised Guide to the Summary Assessment of Costs, drafted by the Civil Justice Council’s GHR working group, is now available and the intention is that it will come into force from 1 October 2021.

In its final report at the end of last month, the working group, chaired by Mr Justice Stewart, recommended the new rates it put forward in January, as well as amending the London 1 and London 2 rates to reflect the work done, rather than whether or not firms were in the City.

This makes London 1 primarily for very heavy commercial and corporate work and London 2 for all other work.

The National 2 and 3 bands will be merged into a single band and those parts of the country not currently allocated to a band will be put into one.

Sir Geoffrey said: “The published guideline rates have been static for too long and this needed to be addressed. I am satisfied with the evidence and arguments set out by the working group.

“I plan to implement all the recommended changes from Friday 1 October 2021 and, to that effect, I have asked my officials and Master Gordon-Saker, Senior Costs Judge, to take forward the publication of the revised guide to summary assessment.”

The judge said he had received correspondence about likely changes to working practices following the pandemic and the impact on the GHR.

“While I think there is likely to be merit in their concerns, I do not think that this should delay the necessary update of what is ultimately an advisory guide.

“I have, however, agreed with the Civil Justice Council that there will be a further review of guideline hourly rates reporting within two years.”

A spokesman for the judiciary was unable to provide any more detail on the review.

ACL chair Claire Green said: “It is unarguable that the GHRs need to be increased after an 11-year freeze, so it is welcome news that the Master of the Rolls is intent on getting them implemented so soon.

“I am also heartened that there won’t be another 11-year wait until the next review, with the Master indicating a further review in two years’ time.

“As a result of the review, we are particularly pleased that qualified Costs Lawyers are now eligible for payment at grades B or C depending on the complexity of the work done – rather than allowing no higher than grade D – along with the recognition that it may in the future be appropriate to align Costs Lawyers with solicitors and legal executives across all grades. This is good news for Costs Lawyers.”

Meanwhile, in Axnoller Events Ltd v Brake and Anor (Summary Costs Assessment) [2021] EWHC 2362 (Ch), His Honour Judge Matthews in Bristol had ordered the defendants to pay 50% of the claimants’ costs of an application notice.

The claimants claimed charging rates from London litigation practice Stewarts Law of £695 for grade A, £525 and £445 for grade B, £370 and £325 for grade C and £210 for grade D. The new rates approved by the Master of the Rolls for London 1 band work are £512 for grade A, £348 for grade B, £270 for grade C and £186 for grade D.

HHJ Matthews accepted that the 2010 GHR were now “well out of date” and of “little assistance” in a case like this.

“Although they are strictly speaking not yet in force, the new 2021 guidelines (which have been approved by the Master of the Rolls) have already been used in summary assessment in the High Court: see e.g. ECU Group PLC v Deutsche Bank AG and Anor [2021] EWHC 2083 (Ch). I consider that I should take these guidelines into account.

“Even so, I consider that the rates claimed here are well over the top, even for London firms. All the fee-earners except the trainee solicitor and the costs draughtsman are charged at more than £100 an hour in excess of the new top guideline rate (for ‘very heavy commercial and corporate work by centrally based London firms’).

“I accept that it is only a guideline, and there will be cases which justify an even higher rate. But I do not think that the work done on this application justifies anything in excess of that rate. If anything, it justifies less.”

The judge reduced the claim of £48,000 to £25,000 on the basis that the hourly rates were too high, the work done on documents was “significantly more than it should be”, and the attendance at the hearing of one or other of a partner and senior associate should not be charged for.

Mr Justice Miles in the ECU Group case last month was referred to what were then the rates proposed by the Civil Justice Council but in allowing higher grade A rates did not comment on them except to note that “guidelines are only that”.

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Costs News
Published date
26 Aug 2021

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