ARC Costs were recently instructed by a firm of claimant solicitors to assist on a personal injury (PI) high value costs case. The case for personal injury damaged settled in the sum of £750,000, so naturally the legal costs in the case were significant. ARC Costs were tasked with drafting and negotiating the bill of costs, which ultimately settled in the sum of £290,000.

ARC Costs regularly assist in the recovery and negotiation of costs in high value claims. If you wish to discuss our services, feel free to get in touch today.

Case Study: PI High Value Legal Costs Case

The costs case arose from a claim for personal injury damages following a fall from height outside a hotel. The client alleged the hotel was at fault due to a lack of lighting or security barriers.

The claimant suffered significant injuries, including a right hip and knee injury, a moderate to severe traumatic brain injury, a temporal bone fracture, memory loss and concentration issues. They also suffered from headaches, PTSD, and a number of psychological issues post accident.

Reports were obtained from a number of medical experts, including a Consultant Neurologist, a Neuropsychologist, a Psychologist and an ENT expert.

Liability was disputed by the defendant and applicable building regulations were a significant issue. Therefore, a Mechanical Engineer, was also instructed to report on the issues. 

The claimant attempted to negotiate a settlement as to liability and quantum on a number of occasions; however, these were rejected by the defendant.

The matter proceeded to Trial on the issue of liability almost five years after the initiation of the claim. At the start of the second day of Trial, the Defendant made an offer of £500,000 to settle the matter. On a fully pleaded basis, the case was estimated to be worth in excess of £2 million. However, in view of potential contributory negligence allegations raised, and general risks on quantum, the parties entered into further negotiations and the claimant accepted an offer of £750,000, thus concluding matters between the parties save as to costs.

Costs in the Case – Outcome

As expected, costs in the case were significant. The case lasted almost five years and required the input of numerous experts, solicitors, and counsel. ARC Costs carefully drafted the Bill of Costs, ensuring all items were included and that the bill was proportionate and reasonable. Thereafter, we negotiated the Bill through replies to the defendants’ Points of Dispute. The total estimate for the bill was £360,000; costs were settled at £290,000.

The issue of liability had previously been budgeted, and therefore a complex Precedent S electronic phased bill had to be produced.  There was significant overspend in certain areas of the Budget, such as Trial Preparation and Trial, but despite this ARC Costs managed to achieve an outcome reflecting recovery on the basis that “good reason” had been demonstrated to deviate from the Costs Management Order, to atleast some degree.

PI High Value Legal Costs

Personal injury claims exceeding the value of £100,000 are generally classed as high value claims (and allocated the Multi Track, thereby subject to costs budgeting). The general rule for PI high value legal costs claims is that the losing party (usually the defendant or insurer) typically pays the claimant’s reasonable legal costs. The amount recoverable is subject to detailed assessment by the court if disputed.

Detailed assessment is the court’s process of deciding how much of the winning party’s legal costs the losing party must pay. It usually follows a successful claim where costs are not agreed between the parties.

It is governed by Part 47 of the Civil Procedure Rules (CPR) and the Practice Direction on Costs.

As part of the Detailed Assessment process, the receiving party is required to prepare and serve a Bill of Costs upon the paying party. This document is a detailed itemisation of all legal costs being claimed, including:

• Solicitor’s fees (hourly rates, time spent)
• Disbursements (experts, court fees, barristers)
• Success fees (if applicable)
• ATE insurance premiums (if recoverable)

The bill must comply with Precedent S (electronic, spreadsheet format) for multi-track claims and served within 3 months of the costs order or agreed settlement

If the paying party disagrees with anything within the Bill of Costs, they have the opportunity to serve Points of Dispute within 21 days of service of the Bill.

These are formal objections to individual items in the Bill, for example:

• Hourly rates too high
• Time spent excessive
• Duplication of work
• Disbursements unreasonable or unnecessary

The receiving party can serve Replies to the Points of Dispute within 21 days, addressing each challenge and justifying the costs claimed.

If costs are not agreed, the receiving party may apply for a Detailed Assessment Hearing. This must be done within 3 months of serving the Bill of Costs.

How can ARC Costs Assist?

ARC Costs regularly assist on personal injury (PI) high value legal costs cases. We are an experienced and independent team of specialised Costs Draftsmen and Costs Lawyers. As independent experts, we can assist either Paying or Receiving parties in resolving costs disputes.

For Receiving Parties we are adept at preparing Costs Budgets and Bill of Costs, as well as providing legal costs negotiations services and preparing Points of Reply. Ultimately we can ensure your legal costs are recovered to the maximum degree possible, and we will always advise on appropriate settlement parameters from the outset for you to determine to what degree you can expect recovery of your legal costs.

Similarly if instructed by the Paying Party, we are adept at settling Points of Dispute, and conducting negotiations to reduce your exposure to legal costs.

If you would like more information on any of our services or wish to speak to a member of our expert costs team about your legal costs, then please do not hesitate to contact us. Please call one of our independent experts at 01204 397302, or email one of our costs experts direct on info@arccosts.co.uk.

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