On the shelf

The reform of civil litigation costs recommended by Lord Justice Jackson in his final report has gathered considerable momentum. After the publication of the final report in December 2009, the Ministry of Justice published a consultation paper, to which more than 600 formal responses were received. The government then published a response in March 2011, following which the Legal Aid, Sentencing and Punishment of Offenders Bill was laid before parliament on 21 June 2011.

Concurrently, the Civil Justice Council has formed a working party to develop practical proposals to assist with the implementation of secondary legislation to introduce certain of Jackson LJ's recommendations.

In relation to the costs of civil litigation, the legal aid bill, which reached the committee stage of the House of Commons on 6 September, seeks to:

• abolish the recoverability of conditional fee agreement success fees from the losing party;
• abolish the recoverability of after-the-event insurance premiums;
• enable the use of contingency fees or damages-based agreements in most civil litigation; and
• enable the court to permit payment of additional amounts to successful claimants in circumstances where the claimant is given judgment that is at least as advantageous as an offer he made to settle the claim.

The areas being examined by the Civil Justice Council's expert working party include:

• qualified one-way costs shifting for personal injury cases;
• additional sanctions and rewards under part 36; and
• Lord Justice Jackson's proportionality test (where only reasonable and proportionate costs may be recovered from the losing party).

The forgotten proposals

The final report made 109 recommendations in total. The main recommendations are, by and large, being implemented. In these straitened economic times, these are mainly the ones designed to seek to tackle the 'country's compensation culture' and 'reduce the unfair costs suffered by'¦ the NHS' (in the words of the Lord Chancellor in the government's response of March 2011).

The recommendations not being implemented (at least for now) are mostly those that have not hit the headlines of the popular press. They include recommendations relating to: witness statements and expert evidence (chapter 38 of the report); case management (chapter 39); the administration of the courts (chapter 42); and information technology (chapter 43).

Witness statements and expert evidence

When providing budgets for clients in most commercial disputes, solicitors will usually advise clients that the most expensive elements of running a case will be disclosure and preparing witness and expert evidence. These are time-consuming tasks both in terms of preparing one's own side's evidence and reviewing the other side's evidence. Jackson LJ recommends that CPR 35 be amended so that a party which seeks to adduce expert evidence must produce an estimate of costs of that evidence to the court, and that CPR 35 be amended to support the use of concurrent evidence (where all sides' experts are cross-examined together at trial). It is surprising that this recommendation is not presently included in the bill or by the Civil Justice Council's working party, although it is unlikely to have the desired effect of reducing costs.

Case management

Lord Justice Jackson makes eight recommendations in relation to case management. The first is that measures should be taken to promote the assignment of cases to judges with relevant expertise (known as 'docketing'). The benefit of docketing is that it promotes better and more consistent case management, which ought to lead to a saving of costs (for example, less detailed skeleton arguments would be needed at interim application hearings and less reading in time would be required by a judge who is already familiar with a case). This measure does not appear to be costly to implement and ought to produce a very real improvement in the administration of justice, and a reduction in the parties' costs.

The administration of the courts

All practitioners will have been frustrated by the level of service received from the court administrative offices. General examples given by Jackson LJ will be familiar to almost all civil litigators: files are lost; court telephone lines are either not answered or are continually engaged; matters are adjourned because there are insufficient judges and the next hearing date will not be for many months. The result is to increase the costs of the parties.

Jackson LJ concluded that there were many reasons why the administration of the courts might not be as efficient as it could be. He cited the fact that many courts were understaffed, that attracting and retaining skilled court staff could be difficult because salaries were low. In addition, there has not been sufficient investment in information technology, which has led to him describing the county courts as 'paper mountains'.

However, it is plain that increasing the efficiency of the courts will require a financial investment from the government at a time when resources are stretched.

Information technology

Communications with clients, other solicitors, barristers, experts and every other party to litigation now take place, on the whole, by email. However, despite every firm having the capability of scanning and emailing documents, communications with the court still routinely take place by fax, or post, and, in cases where a party needs to be sure that a document reaches the court, by an outdoor clerk, paralegal or trainee attending the courts. This takes time and increases costs for the client. In many other jurisdictions, court documents are filed electronically.

When Lord Woolf was proposing his reforms at the end of the last century, he emphasised the importance of introducing an effective IT system. Unfortunately, the courts still do not have an IT system sufficiently sophisticated to satisfy the requirements of the civil courts. Jackson LJ considers that the IT system needs to be able to offer: electronic filing; the ability to maintain all documents and correspondence lodged by the parties in a single electronic bundle, which is accessible to the parties, court staff and judges; a facility for online payments and a national database on which the bundles for each case can be held.

To implement this recommendation would be costly for the government (and is, therefore, politically unacceptable). However, it would be hugely beneficial for litigants, reducing the amount of time their legal advisers spend dealing with paper documents for the court, and therefore cutting the cost of litigation for the parties.

An opportunity missed?

Lord Justice Jackson has expressly stated that he considers that his recommendations should be implemented as a whole. This has not happened, as the government has picked those which it considers will lead to costs savings in the near future. Those proposals which require public expenditure will have to wait '“ even where they are likely to produce costs savings for the parties themselves.

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