CPR Fixed Costs & October 2023 Changes

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What are CPR fixed costs?

CPR 45 refers to the rules and procedures governing the Fixed Costs regime in England and Wales. The Civil Procedure Rules (CPR) are the set of rules that govern civil litigation procedures in these jurisdictions.

The Fixed Recoverable Costs regime was introduced to simplify the process and provide certainty about the amount of costs that parties can expect to recover and costs payable in certain types of cases.

Prior to October 2023, fixed costs applied to specific types of cases with relatively lower monetary value or straightforward issues. However, this changed in October 2023 with the fixed costs extension.

Listed below are some key excerpts from the previous fixed costs rules under Part 45 CPR to explain the Fixed Costs regime:

CPR 45.1 – Scope and application:

(1) This Section sets out the fixed costs and disbursements allowed to any party in relation to proceedings to which this Section applies.

(2) This Section applies to claims started under the Pre-Action Protocols for Low-Value Personal Injury Claims in Road Traffic Accidents and Low-Value Personal Injury (Employers’ Liability and Public Liability) Claims.

(3) Where the claim no longer continues under the relevant Pre-Action Protocol but continues under this Section, this Section will apply.

In essence, CPR 45 applies to certain types of low-value personal injury claims, particularly those arising from road traffic accidents and employers’ liability or public liability cases.

CPR 45.6 – The fixed costs table:

(1) Subject to rules 45.29H, 45.29J, 45.29K and 45.29M, the amount of costs which the court will assess pursuant to rule 45.29E(1)(b) is the amount set out in the Table.

(2) The fixed costs are all the costs, apart from disbursements, which are recoverable in accordance with Part 36.

CPR 45.6 establishes the Fixed Costs Table, which provides specific amounts of costs recoverable in different stages of the proceedings. These fixed costs include all the costs recoverable under Part 36, except disbursements (expenses such as court fees, expert witness fees, etc.).

CPR 45.29 – Restriction on costs for Pre-Action Disclosure and additional claims:

(1) In relation to any proceedings which include a claim to which this Section applies, if the claimant makes an application for an order for pre-action disclosure or serves an additional claim to which this Section applies, the only costs allowed will be the relevant Type A or Type B fixed costs in accordance with rule 45.29C or 45.29I.

(2) In this rule, ‘additional claim’ means a claim made by a claimant under—

(a) rule 20.5 (amendment to correct a mistake as to the name of a party); or

(b) rule 17.1(2)(a) (addition or substitution of a party).

CPR 45.29 restricts costs recoverable for pre-action disclosure and additional claims, limiting them to specific Type A or Type B fixed costs.

Changes introduced in October 2023

In October 2023, a number of changes were made to the CPR fixed costs rules. Civil claims with a value of up to £100,000 are now subject to fixed recoverable costs. The changes apply to all civil litigation, with a few exceptions. Changes will not apply to housing disrepair cases for another two years.

In addition to this, a new intermediate track for claims valued between £25,000 and £100,000 was created. All money claims with a value up to £25,000 still fall within the fast track. Multi track cases will now require a value over £100,000. The small claims track now deals with claims with a value below £10,000.

Complexity bands have been introduced to the intermediate track. They determine the amount of fixed costs recoverable based on the complexity of a case. The level of costs recoverable by legal representatives can be found in tables 12 and 14 under CPR 45.50.

Exceptions to the CPR fixed costs rules

There are a number of exceptions to the fixed costs rules, for example in cases where a part 36 offer has been made. Under CPR 45.15:

“In a case to which Section VI, Section VII or Section VIII of this Part applies

(a)where a Part 36 offer is accepted, rule 36.23 applies instead of the relevant Section; and

(b)where upon judgment being entered, the claimant fails to obtain a judgment more advantageous than the defendant’s Part 36 offer, rule 36.24 apples instead of the relevant Section.”

The court also has discretion under CPR 45 to award costs exceeding the fixed recoverable costs in cases deemed to have “exceptional circumstances.” Additionally, if a party or witness is vulnerable, and this vulnerability necessitates additional work that increases the costs by at least 20% over the fixed costs, the court may consider awarding higher costs​.

Certain types of claims are explicitly excluded from the fixed costs regime. These include residential property disputes involving possession issues, housing disrepair, or unlawful eviction. Such cases, while they may still be allocated to the Fast or Intermediate Tracks, do not have fixed costs applied and costs are determined on an hourly rate basis

The impact of the CPR Fixed Costs extension

Solicitors have expressed significant frustration over the extension of fixed costs regimes to a broader array of civil cases.

Whilst the objective of these proposals was to decrease the overall expenses of litigation and introduce greater assurance and predictability for parties engaged in legal proceedings, there are apprehensions surrounding the potential implications of these new plans on solicitor firms and, of course, claimants.

In addition to restricting access to justice for claimants, it is evident that the expansion of CPR fixed costs will result in adverse outcomes for the majority of law firms affected by these changes.

The most apparent consequence of the fixed costs extension is that solicitors will face limitations on the amount of costs they can recover from the opposing party, ultimately leading to reduced profits and constrained cash flow.

How can ARC Costs assist with CPR fixed costs?

Our team of Costs Draftsmen and Costs Lawyers can assist with any legal costs matters, including fixed costs disputes for claims issued following the extension of the rules.

We can provide assistance on any pre or post issue CPR 45 dispute, and on provision of the paper or electronic papers, we typically secure an interim payment within two weeks, and a resolution to the dispute within two months.

Some matters may need Bills of Costs preparing, and to proceed to a provisional assessment hearing. This may extend the length of the dispute however, we have an unrivalled success rate on proceeding to assessment, with 96% of our fixed costs cases succeeding at this stage.

Get in touch via email at info@arccosts.co.uk, by phone on 01204 397302, or contact us on live chat below.

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