The Senior Master of the Queen’s Bench Division has urged parties to discuss their budgets before the costs management hearing as some judges are imposing directions to force it out of frustration.
Speaking recently at a Law Society civil litigation section conference, Master Fontaine said that, as both judges and practitioners have got more used to costs budgets, “we are seeing more agreement between parties on costs budgets either partially or wholly, and parties being more realistic”.
She continued: “It’s very important to hold prior discussions with your opponents and be realistic about the figures. Think about the issues before you discuss them.
“Some of my colleagues have, in the past, been so frustrated by the failure of parties to discuss that when they’re listing costs management conferences, they’ve imposed an order saying that, unless a party makes an offer in money terms for every phase that they dispute, they won’t be permitted to make any submissions at the hearing in respect of that phase.
“I haven’t been quite so harsh as that but, really, if you’re going to dispute something, you’ve got to put your money where your mouth is and say what you think it’s worth.”
The master also urged lawyers not to go into “long submissions or enormous detail” for the costs management hearing. “It’s meant to be a rough and ready approach, like summary assessment, and I would hope we could cut down the costs aspect of a case management conference to 45 minutes where there are only two parties.”
Later during her session – in which District Judge Keith Etherington also took part – the panel was asked whether Court of Appeal guidance on the proportionality rule was needed.
Master Fontaine said: “I think the problem with our costs system as a whole is probably inconsistency… and proportionality has added to that mix. It’s not just costs budgeting where there is inconsistency. Unless and until we get a system of fixed costs, there’s always going to be that element of not knowing what you’re in for. Costs budgeting at least means that the uncertainty is moved to an earlier stage of the case, but it doesn’t make it easy if you’re advising your clients on what their risks as to costs are.”
DJ Etherington said it would be helpful for judges and practitioners to have a “consistent baseline from which the discretion can be exercised”.
He continued: “At the moment, there is broad inconsistency around the country as to the manner in which proportionality is seen. I suspect it will probably be more helpful for there to be a rule change rather than simply an authority. I think everybody would welcome a more concrete definition, or at least a better interpretation of the phrase.”
It emerged last week – subsequent to the event – that an appeal against the Senior Costs Judge’s ruling in BNM v MGN has been leapfrogged to the Court of Appeal. The appeal will consider how deeply reasonable costs and additional liabilities can be cut by reference to proportionality.
Costs Lawyer Andy Ellis, managing director of costs firm Practico, which is acting for MGN, said: “Previously listed in the Chancery division in the first week of December, I suspect most observers will see the leapfrog as the shortest route to the inevitable final destination for this thorny issue. The post-LASPO test needs interpretation at the higher level – and maybe if expedition means expedition, a pre-Christmas hearing is still on the cards.”
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