The Court of Appeal ruled yesterday in the matter of Andrew Mitchell MP and News Group Newspapers Ltd in relation to recently introduced legislation for costs budgeting in civil litigation, part of the Jackson reforms introduced on 1 April, 2013.
The Court of Appeal upheld the decision of Master McCloud, given in June 2013, that, because the appellant had failed to file his costs budget in time, he was to be treated as having filed a costs budget comprising only the applicable court fees. The second decision was her refusal to grant relief under Civil Procedure Rules, from her first decision. The forgiving approach previously adopted by the Courts is now a thing of the past.
The effect of these decisions is to ratify Lord Jackson’s reforms, in that court orders, rules and practice directions, including those relating to costs, budgeting and deadlines, must be met and documentation and budgets must be submitted in full and on time. While solicitors can go back to court to seek amendment to pre-approved budgets, failure to meet deadlines in full can, as in this case, result in costs becoming irrecoverable.
“The upshot of this is that any theory around the Jackson reforms – subject to any appeal to the Supreme Court – has now become practice,” comments Des Collins, Senior Partner and head of the Personal Injury practice at Collins Solicitors. “In addition, there will be an inevitable surge in satellite litigation as the courts try to get to grips with the precise meaning of “unexpected developments” which the Court of Appeal indicated might be a “good reason” to exercise discretion in favour of a defaulting litigant.
Lack of resource will no longer be an excuse for failure to comply and there should be no special rules for niche firms; no firm should litigate if it plans to rely on the fact that it is small to get leeway from the Courts. This will, however, inevitably lead to the potential for bigger firms to take advantage of smaller firms and make it difficult for them to comply with the rules. At some point this will have to be addressed.”
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