MoJ “keen” on Jackson fixed costs reforms but they will generate “cottage industry”, says leading QC

The Ministry of Justice is keen on taking forward Lord Justice Jackson’s plans to extend the use of fixed costs, according to a leading QC.

However, Nick Bacon QC also told today’s Association of Costs Lawyers annual conference that the reforms were likely to lead to a “cottage industry” for costs specialists as the way they operate is worked out.

Mr Bacon said he attended a meeting recently where MoJ officials expressed support for the Jackson report. He predicted that there would be a consultation early next year, adding the reforms are “going to happen”.

But on a show of hands, there was virtually no support for them from the 150 delegates.

At the same time, Mr Bacon said the reforms would generate a “cottage industry”. For example, he said, the report did not detail how cases would be allocated to the appropriate band of complexity – the difference in costs between the four bands would justify challenging decisions.

Jackson LJ opened the conference by observing that there was “nothing like the same degree of hostility between the warring factions” around his most recent report when compared with his original 2009 review.

He sensed “a change in approach to costs” among practitioners, which he attributed to “a new generation” of lawyer who has grown up with a much better understanding of costs law, along with “a realisation that untrammelled litigation costs are simply not acceptable to the public”.

Mr Bacon said he had spent two days in the Court of Appeal this week on the other side of a “wholesale challenge” by NHS Resolution to the level of recoverable after-the-event insurance premiums for initial expert evidence in clinical negligence cases – such as a £5,000 premium for a case valued at £3,000.

However, the silk said he was “pretty confident” the court would back such premiums.

He also said the thorny issue of whether a claimant in fixed costs case whose part 36 offer was accepted late should be able to claims costs on the standard or indemnity basis – which has been the subject of several conflicting lower-court rulings – would be considered by the appeal court in the case of Hislop v Perde.

The recent decision of Her Honour Justice Walden-Smith in Central London County Court held that the late acceptance did allow the claimant to escape fixed costs for the period after the 21 days given to accept the offer expired.

This article first appeared in Litigation Futures on 20 October 2017

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24 Oct 2017

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