The Ministry of Justice has announced their decision to delay the introduction of fixed recoverable costs in housing disrepair cases.

2023 Fixed Costs Extension

The Ministry of Justice (MOJ) has planned to extend fixed costs in a number of legal cases from 1st October 2023. The fixed costs regime will be extended to cover a wider range of civil cases, including certain types of personal injury, clinical negligence claims, and other civil cases.

The fixed costs extension is intended to provide a number of benefits, including:

• Reducing the cost of litigation for both parties
• Making it easier for people to access justice
• Increasing the efficiency of the civil justice system

However, the fixed costs extension has also been criticised by many within the legal industry for being too restrictive and for limiting the ability of lawyers to charge for their work.

The following are some of the key features of the fixed costs extension:

• The fixed legal costs will apply to claims where proceedings are issued on or after 1st October 2023, save for personal injury.
• The fixed costs will apply to personal injury claims where the cause of action arises on or after 1st October 2023
• Fixed recoverable costs will only apply to disease claims where the letter of claim has not been sent to the defendant before 1st October 2023.
• The fixed costs tables have been adjusted and uprated for inflation since they were set out by Sir Rupert Jackson in 2017.
• A 35% uplift will be introduced in cases where a Part 36 offer is beaten, and a 50% uplift on fixed costs for unreasonable behaviour.

Housing disrepair fixed costs delays

The housing disrepair sector has escaped fixed costs for the next two years. The Ministry of Justice; however, do still feel the requirement to extend fixed costs in housing disrepair cases, with a spokesperson stating:

“We want to reform civil justice costs because giving all parties certainty upfront will ensure no one is locked out of justice for fear of how high their legal fees might be if they lose.”

However, it could be argued that, the majority of housing disrepair cases are brought under a Conditional Fee Agreement (CFA), meaning the risk of adverse costs would be low in any event.

The MOJ has further stated that the delay in the introduction of housing disrepair fixed costs is necessary to allow time for further reforms in the housing sector to take effect. These reforms include the introduction of a new Decent Homes Standard and a new Social Housing Regulation Bill, which will increase the powers of the Housing Ombudsman.

The MOJ said that it wanted to ensure that the introduction in these instances was aligned with wider reforms. They also stated that they wanted to ensure that the introduction did not have a negative impact on the ability for tenants to access justice.

The delay has been welcomed by some tenant groups and lawyers who have argued that housing disrepair fixed costs would have made it more difficult for tenants to bring claims.

However, others have criticised the delay, arguing that it will only serve to prolong the time it takes for tenants to get the repairs they need. Some had welcomed the introduction of fixed costs in the hopes that it would reduce the number of unsupported, spurious claims brought against landlords.

It is unclear when fixed costs will be introduced in housing disrepair cases, especially with a general election scheduled before the two year period is up. The MOJ has said that it will keep the situation under review and that it will make a decision on the matter in due course.

How can ARC Costs assist?

To date the ARC Costs team have recovered hundreds of thousands in legal fees and disbursements for our specialist housing disrepair costs clients.

We would recommend our input is provided at the very outset of a claim. We will provide advice on how to suitably structure your retainer and as to the hourly rates that will likely be recoverable on assessment for your housing disrepair claims costs.

Further input will be necessary throughout the claim, particularly in preparing and negotiating any Costs Budget, which is critical to get right so as to ensure maximum recovery on assessment. On conclusion, following preparation of the Bill of Costs we will assist in negotiating recovery of your outstanding fees.

Our costs lawyers and draftsmen can also provide assistance to paying parties in negotiating a Bill of Costs and in drafting Points of Disputes following receipt of a Bill of Costs.

Get in touch for free initial advice on recovering your housing disrepair costs.

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