ARC Cost were recently successful in arguing that costs in a case, which was settled using a Part 36 Offer, were fixed by CPR 45, Section IIIA, 45.29C, and that fixed recoverable costs Table 6B B should be utilised when determining the amount of costs the Claimant is entitled to recover.

Please note that this article relates to the CPR as they stood prior to the fixed costs reforms on 1 October 2023 as can be found here. These Rules continue to apply to all cases issued prior to 1 October 2023, or in PI cases, where the cause of action arose pre-1 October 2023.  As such references to the CPR may be different to those that currently exist in the present CPR.

We continue to assist in post-1 October 2023 fixed costs disputes, and therefore please do not hesitate to get in touch regarding the same.

Fixed Recoverable Costs Tables

Part 45 of the Civil Procedure Rules details the fixed recoverable costs (FRC) for various types of claims. CPR 45 specifies the amount of legal costs recoverable by the winning party in civil litigation for different categories of claims. It also gives the Court discretion regarding whether costs are payable, when they should be paid, and the form of cost order to be made.

If a claim falls under certain sections of Part 45, and the parties agree or the court decides costs are due, the costs awarded must match the fixed costs outlined in the appropriate section of Practice Direction 45. This means the court can award costs that are neither more nor less than these fixed amounts.

Fixed recoverable costs tables cover all claims that fall within the fixed recoverable costs regime, including those in the small claims track, fast track, and the new intermediate track for claims valued between £25,000 and £100,000 (this will only apply to cases that commence post 1st October 2023). Pre- 1 October 2023, the limit of fixed costs was in relation to cases up to £25,000 in value and that had entered the Portal (and were not allocated to the Multi Track).  Rates of fixed costs will now be allocated based on complexity bands and stages of the litigation. Fixed recoverable costs do not apply to cases allocated to the multi track.

For pre-October 2023 cases, a different set of fixed recoverable costs tables are to be used when determining fixed costs rates.

Fixed Recoverable Costs Table pre-October 2023

Before October 2023, the previous version of CPR 45.29A applied to specific types of claims under the fixed costs regime, namely those which started under the Pre-Action Protocols for Low Value Personal Injury Claims in Road Traffic Accidents or for Low Value Personal Injury Claims.

Please note the sections below are only applicable to actions which arose before 1st October 2023.

Under CPR 45.29B,

“Subject to rules 45.29F, 45.29G, 45.29H and 45.29J, and for as long as the case is not allocated to the multi-track, if, in a claim started under the RTA Protocol, the Claim Notification Form is submitted on or after 31st July 2013, the only costs allowed are—

(a) the fixed costs in rule 45.29C;

(b) disbursements in accordance with rule 45.29I.R 45 applies only if the claim is no longer being pursued under the respective Protocol or the Stage 3 Procedure in Practice Direction 49F. “

Under CPR 45.29C

“(1) Subject to paragraph (2), the amount of fixed costs is set out in Table 6B.

(2) Where the claimant—

(a) lives or works in an area set out in Practice Direction 45; and

(b) instructs a legal representative who practises in that area,

the fixed costs will include, in addition to the costs set out in Table 6B, an amount equal to 12.5% of the costs allowable under paragraph (1) and set out in Table 6B.

(3) Where appropriate, VAT may be recovered in addition to the amount of fixed recoverable costs and any reference in this Section to fixed costs is a reference to those costs net of VAT.

(4) In Table 6B—

(a) in Part B, ‘on or after’ means the period beginning on the date on which the court respectively

(i) issues the claim;

(ii) allocates the claim under Part 26; or

(iii) lists the claim for trial; and

(b) unless stated otherwise, a reference to ‘damages’ means agreed damages; and

(c) a reference to ‘trial’ is a reference to the final contested hearing.”

CPR 45 Table 6B refers to a specific table under the previous section 45.29 of the Civil Procedure Rules. Table 6B relates to fixed costs for claims which have been allocated to the fast track. If a claim falls into this category, the claimant will be entitled to recover the fixed costs in Table 6B.

Case Study: Fixed Recoverable Costs Rates Dispute

In a recent case, ARC Costs held the stance that fixed recoverable costs Table 6B should be utilised when determining the amount of costs the successful Claimant was entitled to recover in a fixed costs assessment.

The Defendant in the case disputed the level of fixed costs payable due to the Claimant’s conduct. Their main arguments for disputing the level of fixed costs was that the Claimant issued proceedings prematurely, issued for an unrealistic amount and delayed the claim by failing to provide pertinent information pre-issue.

They further argued that the Claimant had issued proceedings for costs at the incorrect rate. They stated that the Claimant was only entitled to recover fixed costs at the agreed damages amount and not at the amount in which they issued proceedings.

The Defendant submitted that the matter fell within the under £5,000 category in accordance with CPR 45.3a Table 6b Fixed costs (RTA) due to the damages settlement amount.

Finally, they asserted that the Claimant should be entitled to recover fixed costs at the pre-issue rate in accordance with CPR 45.3a Table 6b Fixed costs (RTA).

Within their arguments, the Defendant requested that the Court utilises the power conferred to them under CPR 44.2 regarding the Court’s discretion as to costs and the Court’s power under CPR 3.3 to make an Order of their own initiative to reduce the amount of costs payable by the Defendant.

ARC Costs refuted the assertions of the Paying Party within this argument and stated that CPR 44.2 and CPR 3.3 could not apply within the circumstances.

It was further challenged in respect of the allegations regarding the Client’s conduct. ARC Costs further stated that the Court should not make any enquiry as to conduct, and to do so would be erroneous and would undermine the concept and practical application of fixed costs. To encourage enquiry into parties’ conduct where fixed costs apply, would be undesirable.

As representative of the Receiving Party, we concluded that, as the claim proceeded through the fast track stages and settled approximately two months before a listed trial, the appropriate fixed costs apply under Fixed Recoverable Costs Table 6B for a listed matter. 

Skeleton arguments were prepared and exchanged, and on attendance at the hearing, the Judge was already convinced that the position of the Receiving Party (and ARC Costs) was correct that listing fixed costs should apply.  After opportunity for further oral submissions from the Paying Party, our team was successful in their arguments at the Fixed Costs Assessment Hearing and fixed costs were settled in full at the amount of £3,405. relying on Table 6B.

Application costs were also awarded to the Receiving Party for having to proceed the matter to an attended hearing to determine costs issues.

Generally speaking fixed costs disputes are resolved on the papers, akin to a provisional assessment type process however, the Paying Party had failed to provide any consent to such a process in this dispute, thereby increasing the application costs payable.

How can ARC Costs Assist with any Fixed Costs Disputes? 

The Costs Draftsmen and Costs Lawyers at ARC Costs are highly experienced in the recovery of legal costs.

We can assist in the recovery of disputed fixed costs rates and disbursements by contacting the paying party in an attempt to obtain agreed costs, and in the event of non-agreement, the preparation and conduct of any application to recover fixed costs.  We are able to assist in all matters, whether issued pre or post 1 October 2023.

We can also assist in the recovery of your costs at detailed assessment if the dispute relates to an hourly rates type matter. We can assist in the drafting of your bills of costs, points of dispute and replies to points of dispute. If an agreement cannot be reached as to costs, we can further assist by providing representation at detailed and provisional assessment hearings at Court.

If you require any free initial advice, or our assistance with regards to any aspect of costs, please email us at info@arccosts.co.uk, or contact us via the Contact Us page and one of the team will get in touch on the same working day. Our team can also be called on 01204 397302.

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