Costs budgeting: anyone for Marmite?

On 13 July 2022, the Civil Justice Council (CJC) held an invitation- only costs conference in Mary Ward

House, London. Mary Augusta Ward CBE was a social reformer and novelist. She was also an anti-suffragist who became founding president of the Women’s National Anti- Suffrage League. But her zeal for reform and the location of Ward House in Bloomsbury – scene of many an intellectual debate – made it a fitting venue for the CJC conference.

My primary interest in attending lay in ensuring the meeting supported a robust regime of sanctions for failing to engage meaningfully in pre-action [A]DR. The need for an early sanction was not lost on the Master of the Rolls, who gave the keynote speech. (I will return to the topic of PAP reforms following the publication of the PAP Review, likely to be this autumn.)

Love it or hate it?

Next up for discussion was that perennial Marmite topic: costs management. The question being: “is the game worth the candle?” Funnily enough, this was the  question posed in Lord Justice Jackson’s (as he then was) Final Report on Civil Litigation Costs in 2009 (p414). His conclusion was that it was. In reaching this conclusion, his Lordship was supported by some heavyweight players, including the Commercial Litigation Association (of which I was chairman at the time) and the Law Society of England and Wales – whose response was drafted by me (as a member of its Civil Justice Committee) and which was in due course endorsed by the Law and Policy Board (as it was then known) of the Law Society.

I had committed to costs management as a tool for improving the client experience by ensuring my former firm was founded on these principles from our beginning in April 2003. Hourly rates for our commercial litigation niche practice were published on the firm’s website and budgets were published for model cases in all three tracks. These were the most frequently visited pages of the firm’s site.

At the same time as we introduced costs management into our practice, Professor John Peysner, District Judge Lethem (as he then was) and HHJ Brown (as he then was) were other powerful advocates for the use of budgets in civil litigation – especially where big costs were going to be racked up.
John Peysner’s now famous parallel with a construction project was often employed during these times to illustrate the common sense rationale for costs budgeting.

A lively debate

Given my involvement in the development of costs management, I looked forward to the debate about it at the conference. To lead the debate the CJC had brought together an impressive panel including such heavyweight litigators as David Marshall (past chair and current member of the Law Society’s Civil Justice Committee), Brett Dixon (chair of the Civil Justice Committee) and Richard Langley (Hon Treasurer of the London Solicitors Litigation Association (LSLA)). The session was chaired by Master Kaye (also a past president of the LSLA) with contributions from the floor by myself, David Greene (yet another past president of the LSLA), HHJ Lethem, Professor Dominic Regan and Kerry Underwood, among many other expert contributions.