Lawyers highlight issues with new FRCs

The extended fixed recoverable costs (FRC) system has come under scrutiny due to its ambiguity, which affects both injured individuals and law firms, according to the Association of Personal Injury Lawyers (APIL). John McQuater, an executive committee member of APIL, noted that “it’s still early days, but obvious problems are emerging from the 2023 extension to the FRCs regime.” He emphasised concerns about the lack of clarity regarding allocation and assignment to a complexity band, particularly when parties are negotiating settlements prior to issuing proceedings or before allocation.

In a stocktake on these reforms by the Civil Procedure Rule Committee and Ministry of Justice, the APIL received feedback related to a new intermediate track for cases valued between £25,000 and £100,000, which now includes FRC for all fast-track claims. McQuater articulated the core intention behind FRCs, stating that “the whole point of FRCs is so the legal costs of a case can be predictable and assessed accurately,” yet the reforms have introduced uncertainty, complicating the ability of lawyers to inform injured clients about how costs will be managed from the start.

Challenges arise particularly when cases initially categorised in the multi-track settle at a lower value, placing them into the intermediate track while defendants may refuse to agree to the assessed costs. McQuater suggested that the rules should mandate that “the parties attempt to agree the track and, if appropriate, the complexity band at the outset,” indicating that this agreement need not be binding but could serve as a reference during cost assessments if negotiations fail.

He further argued for the consideration of personal injury cases, suggesting they should be completely excluded from complexity band 1 in the intermediate track, given the unique challenges they present in the context of fixed recoverable costs.

Copyright & permissions