Were lawyers ready for the electronic bill of costs?

We are five months into the compulsory electronic bill of costs and so far all is quiet. Obviously it will take time before cases affected by the change hit the courts, but research undertaken by the Association of Costs Lawyers has shown that many solicitors and judges were not ready for the new bill when it became compulsory in April and few are keen on it now.

Only 10% of the Costs Lawyers we polled said all the solicitors they dealt with were ready when the new bill came into force, compared to 56% who said none of them were. 

Asked what solicitors’ reaction had been since, half said there was either a lot of last-minute panicking (13%) or had asked the Costs Lawyer to sort it out for them (37%). One in six solicitors preferred to stick their head in the sand and just put off dealing with it. Just 6% of Costs Lawyers said their solicitors had managed a smooth transition to the new regime. 

Things were no better on the bench. Just 16% of Costs Lawyers reported that “some” judges were ready for the new bill, while only 5% found that the courts were “keen to get going” with it. Some judges would use their discretion to waive use of the bill for as long as they could, Costs Lawyers said, while others could not get going even if they wanted as they had still not received the training or technology required. 

It is perhaps no surprise that many solicitors are struggling to come to terms with the new bill of costs, with many yet to have either the technology or the time-recording processes in place. But the time will come, sooner rather than later, when they will literally pay the price for their failure to adapt. 

Most district and costs judges will not have yet dealt with an electronic bill, due to the time lag in them reaching court, which is fortuitous given some of the delays in providing training and technology. But both judges and lawyers will have to get on top of it – this is, without doubt, the future. 

With the culture of compliance that has sharpened since the Jackson reforms, I would not be surprised to see judges clamping down on those who wilfully ignore the electronic bill. 

There is clarity on one point, however. My colleague Claire Green wrote in April about the need to file electronic copies of the bill at court when notice of commencement is served on the paying party. There were questions over this arising from the apparent tension between paragraphs 5.A4 and 5.1A of practice direction 47. 

5.A4 provides: “Where a bill of costs otherwise falls within paragraph 5.1(a) but work was done both before and after the Transition Date, a party may serve and file either a paper bill or an electronic bill in respect of work done before that date and must serve and file an electronic bill in respect of work done after that date.” (Emphasis added.) 

5.1A says: “Whenever electronic bills are served or filed at the court, they must also be served or filed in hard copy, in a manageable paper format as shown in the pdf version of Precedent S. A copy of the full electronic spreadsheet version must at the same time be provided to the paying party and filed at the court by e-mail or other electronic means.” (Emphasis added.) 

This led to questions on whether it was necessary to file an electronic bill at court at the point that the bill is served on the paying party, at the N252 notice of commencement stage or, as had been the case, when a hearing is requested by filing an N258 request for assessment and a fee paid. 

Stressing that this was just his personal view, the Senior Costs Judge, Andrew Gordon-Saker, told the ACL: “Electronic copies of the bill should not be filed at court when notice of commencement is served on the paying party. It is fair to say that you are not the first person to raise this, but for my part I think that the answer is tolerably clear. 

“PD 47 paragraph 5.2 continues to prescribe what should happen when the receiving party commences detailed assessment proceedings. There is nothing there about sending things to the court. 

“Paragraph 13.2 prescribes what should be filed at court when a detailed assessment hearing is requested. 

“Paragraph 5.1A simply provides that when you serve or file an electronic bill you must serve or file a paper version. Whenever you serve or file an electronic bill you have to provide the full electronic spreadsheet version by email or other electronic means. 

“The second sentence does not require the receiving party to file an electronic bill when it serves it, it merely indicates the means by which you serve/file the spreadsheet version. 

“Paragraph 5.A4 provides that when work is done before and after the transition date, you must serve/file an electronic bill for the work done after, but may serve/file either a paper bill or an electronic bill for the work done before. 

“As I read them, in none of these provisions is there a requirement to file when you serve (or vice versa).” 

The judge said the answer was to start with paragraphs 5.2 and 13.2 “and work backwards”. But he added: “There may, however, be a case for clarifying the second sentence of paragraph 5.1A if that is what is causing confusion.”

Francis Kendall is vice-chair of the Association of Costs Lawyers

This article was first published in THOMSON REUTERS PRACTICAL LAW DISPUTE RESOLUTION BLOG on 12 September 2018.

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12 Sep 2018

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