Are the Jackson reforms working?

In his review of civil litigation costs in 2009, Lord Justice Jackson remarked:
‘It does not make sense for the court to manage a case without regard to the costs which it is ordering the parties to incur.’

Here we are, two years into implementing the reforms of the civil justice system, including case management and costs budgeting, which flowed from that report and were envisaged by Jackson LJ as being essential to boost efficiency and reduce litigation costs. What have we achieved?

The profession as a whole
has been aware of issues in the implementation of the case management and costs budgeting reform since the
day it was introduced.

Teething problems

The first reading of the notes for guidance produced to support the drafting of costs budgets left most scratching their heads and floundering at the first hurdle of collating the file data in a new and bewildering way.

In the next instance, there were problems with the formula used to populate the precedent form H, which meant that the form was unable to do the appropriate calculations. This could be described as nothing more than a teething problem, but from a purely practical point of view it gave a lot of practitioners headaches, especially as this issue coincided with the plethora of case law deciding the appropriate sanctions for delay in filing costs budgets.

Running concurrently,
and compounding that problem, was the issue in relation to
the form dispatched by the
court at the point of allocation. Prescribed under Civil Procedure Rules (CPR) practice direction 26 (2.1(1)), there are three different forms: N149A (small claims track), N149B (fast track), and N149C (multi-track). It transpired that there were different versions of the forms in circulation: one which made provision for a budget to be filed on a certain date and one which did not.

In Porbanderwalla v Daybridge Ltd (Birmingham County Court, 30 January 2014), neither party filed a budget. The claimant successfully appealed the district judge’s decision that the notice of proposed allocation to the multi-track required a costs budget on the basis that the version of the notice used did not specify a date for service.

By contrast, but giving valuable clarification of the point at a time when it was badly needed, was Burt v Linford Christie (Birmingham County Court, 10 February 2014). In that case, the same decision was arrived at for the same reason, meaning the defaulting defendant was entitled to rely upon CPR 3.13 and file his budget seven days before the case and costs management conference. However, after an unsuccessful attempt to file the budget at court by fax, the document was served by DX and arrived four days late. The sanction therefore remained.

Inconsistent approach

Various other stumbling blocks have emerged in the intervening period. Not least of these is the inconsistent approach adopted by the courts across the country – not unsurprisingly, most
would say, given the speed
with which the process was introduced and the lack of information available at the outset as to its implementation. Add to the maelstrom the lack of resources available to train court staff and the judiciary, and it would seem fortunate that there remains any support for the principle.

Support or not, we are told
it is here to stay, but important questions remain:

• Is it feasible, or sensible, to ask practitioners to cost the steps to the litigation before they have been set?
• Does a judge ‘commenting’ on a phase of a budget ever mean anything, especially when those comments are not formally recorded?
• Could we not deal with incurred costs in a more effective way (for example, some judges are actually ordering full detailed breakdowns of these already)?
• What about hourly rates?

Earlier this year, the Association
of Costs Lawyers (ACL) convened a working party to consider the problems arising out of the current system of budgeting, identify possible solutions, and produce a discussion document. This document has been presented to both the membership for consultation
and Jackson LJ for his
information and assistance.

It is the intention of the
ACL to present a finished article,
post consultation, to the Civil Procedure Rule Committee
in June.

In the last month Jackson LJ has taken to the road, scheduling a series of meetings with practitioners countrywide to discuss the issues arising from the whole process of costs budgeting.

Although he has made it
clear that the research he is undertaking is preliminary,
it is clear that he is prepared to listen to the practitioners at
the coalface. SJ

Claire Green is policy officer of the Association of Costs Lawyers