Government is urged to limit fixed costs

The Government is being urged to revise Lord Justice Jackson’s recommendation to extend fixed recoverable costs, by limiting them to fast-track claims.

The calls for the Jackson proposals to be curbed, follows a survey carried out by the Association of Costs Lawyers (ACL).

Although 52 per cent of respondents said it was ‘fair enough’ to extend fixed costs across fast-track cases, they felt strongly that the proposals should go no further.

Arguing for a limit on fixed costs, many cited the fact that the costs budgeting process has improved significantly over the past 18 months

The survey also revealed that solicitors need to keep a tighter rein on costs and were putting themselves at risk of significant financial losses by not updating their budgets.

Only 5 per cent of costs lawyers said budgets were always observed; 65 per cent said they sometimes went over, while 29 per cent admitted they had clients who always exceeded their budgets.

The ACL advised that solicitors should be updating their budgets if required as the case progresses and said the survey points to the fact that the legal sector still has a long way to go.

ACL chairman Iain Stark said: “Costs lawyers know better than anyone that budgeting is becoming embedded in civil litigation and it will only keep on improving.

“It is true that many solicitors still need guidance but, with judges now far more confident in exercising their costs management powers, we are positive that it will make a real difference in controlling costs.

“That being the case, do we really need the upheaval and satellite litigation that fixed costs would cause as lawyers push for the highest fee available?

“They work on the fast-track because solicitors can cope with the ‘swings and roundabouts’ of having some cases that require more work and others that require less than the fixed cost allows. However, that calculation does not work with more complex cases.

“Costs lawyers have an interest in maintaining budgeting, of course, but as a profession we have worked hard to make the process work and, while there is still some way to go, we are proud of what we have achieved.”