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Jackson LJ considering ‘intermediate’ litigation track

Costs shifting is ‘a two-edged sword’ that both promotes and inhibits access to justice, says judge

7 March 2017

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Lower value multi-track claims could fall within the ambit of fixed recoverable costs, said Lord Justice Jackson, who is considering a new ‘intermediate track’ for litigation as well as a potential pilot of a voluntary regime for SMEs involved in business disputes.

In his keynote address at the Costs Conference today, Jackson LJ noted how many lawyers have argued that costs management is working much better than ever before which negates the need for fixed costs in the multi-track.

‘The counter-argument is that for lower value cases, a fixed costs regime is simpler and cheaper,’ said Jackson LJ, adding that he has ‘to identify which types of case and which “levels” of case are suitable for fixed costs’.

‘One view is that costs management should take care of everything above the fast track,’ he said. ‘The alternative view is that lower value multi-track cases should have fixed costs.

‘Many people are arguing that the value of a claim should not be the sole determinant of whether it is suitable for fixed costs. One must also look at the complexity of the case, the number of issues, the number of experts and so forth.

‘If some lower value multi-track cases are to have fixed costs, should a new “intermediate track” be created to accommodate such cases? In that event, what should be the procedural rules for the intermediate track? These are questions which I am considering with the assessors.’

Putting his proposals in context, Jackson LJ said ‘lower value’ had different meanings: ‘In the mercantile courts (I am told) ‘lower value’ means claims up to about £250,000. In personal injury litigation, on the other hand, the upper limit for ‘lower value’ claims would be well below that figure.'

The Court of Appeal judge also said he was also exploring the possibility of piloting a voluntary regime whereby individuals and SMEs involved in low-value business disputes involving individuals could take advantage of fixed costs combined with a streamlined process.

Jackson LJ called for further arguments to be made both for and against fixed costs in judicial review at a London seminar on 13 March, as, he explained, ‘the issues are complex’.

‘A number of interesting suggestions have been made. One idea floated is that the optional fixed recoverable costs rules which apply to Aarhus cases might be developed and applied more generally to judicial review claims. I hope to hear full argument on these matters and from all angles, including the views of claimants, public authorities, pressure groups, and others involved in such litigation.’

While recognising the ‘large number of written submissions’ received following his call for evidence, the judge highlighted the ‘curious omission’ from many that costs shifting is ‘a two-edged sword’.

‘It both promotes and inhibits access to justice. Some litigants are enabled to litigate, because they know that they will get costs back at the end. Others are deterred by the fear of an adverse costs order.

‘The “no costs recovery” regime in employment tribunals promotes access to justice because of the latter factor. Somehow I have got to take account of these conflicting considerations in whatever I recommend.’

Concluding his speech, Jackson LJ said: ‘My ultimate objective is to put forward a package of proposals which will promote access to justice and control costs, as well as being fair and workable.’

Responding to Jackson LJ’s speech, Francis Kendall, vice-chairman of the Association of Costs Lawyers, said: 'I hope the positive support for costs management that Lord Justice Jackson acknowledges in his speech will temper the need for wholescale change by way of fixed costs. It is less than four years since his own reforms were introduced and it was to be expected that such a significant change to legal practice would take time to bed down. 

'Nonetheless, if he is to press on with major reform, it is positive that he has already recognised that there is no way that a "one-size-fits-all" fixed costs regime would be justifiable. This makes his task more difficult, but should go some way to making it more tolerable.'

John van der Luit-Drummond is deputy editor of Solicitors Journal

john.vanderluit@solicitorsjournal.co.uk | @JvdLD

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Litigation Costs Courts & Judiciary

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fixed recoverable costs