ARC Costs regularly assist in high value costs cases in which the requirement to file a costs budget is often questioned due to conflicting guidance under CPR 3.12 and recent case law. On a recent case, ARC Costs assisted in the recovery of costs which exceeded £522,000.00 in a case where damages are valued in the sum of £10,000,000.

Is a Costs Budget Required in High Costs Cases under CPR 3.12?

Under CPR 3.12, cases valued over £10 million are listed as a notable exclusion, alongside infant cases, to costs management orders. However, over the years, many Courts have exercised their unfettered discretion to make a Costs Management Order. Even in a case such as the ones mentioned above in which costs budgeting does not automatically apply because the claim is over £10 million (CPR 3.12(1)(a)), the court has a discretion to decide whether costs budgets should be filed and exchanged.

If a party seeks to disapply costs management, it would be advisable for them to make an application for the same as promptly as possible. It is likely that the Court will hear the application at the Costs and Case Management Conference unless the parties agree to disapply costs budgeting via a Consent Order.

High Value Costs Budget Case Study

ARC Costs recently assisted on a complex case where damages were claimed in the sum of £10,000,000.  ARC Costs drafted a costs budget in which the grand total of incurred and estimated costs amounted to £522,230.92 in order to protect the client’s position as the Court may order costs management to apply as per above.

The costs included in the budget included solicitor profit costs (both incurred and estimated), Court fees, fees for multiple Counsel including junior and Kings Counsel as well as various expert witnesses.

In the end, the costs budget was dispensed due to the value of the claim; however, ARC Costs would always recommend erring on the side of caution when it comes to cases that fall within the exclusion of CPR 3.12 due to the discretion of the Court to make a Costs Management Order.

How can ARC Costs assist?

The costs lawyers and costs draftsmen at ARC Costs can assist on the legal costing process of all case types, including high value cases.

We can assist in the recovery and negotiation of your costs by drafting your Costs Budgets and Bills of Costs, as well as drafting Points of Dispute and Points of Reply 

The team can be contacted via email at info@arccosts.co.uk, or by telephone on 01204 397302. For more information on our services, please visit our services page here or find out about our speciality areas of expertise on our legal costs page.

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