The Civil Procedure Rules Annual Open Meeting took place today (10 May 2024) and offered up developments in relation both to Fixed Recoverable Costs, Clinical Negligence Fixed Recoverable Costs, Agency Fees and more. Our latest blog guides you through all of the latest developments. 
 
Clinical Negligence Fixed Recoverable Costs Update 
 
The update was provided by Senior Master Cook and Laurent Viac (from the Department of Health and Social Care (DoH)). It must be caveated that the rules are still in development and subject to change. 
 
It is clear from discussions there is still a lot of work to be done on the rules before a draft can be published. What is apparent is that there is a clear policy intent from the Department of Health to treat Clinical Negligence claims differently to other fixed costs claims and the CPRC repeatedly expressed concerns that there would need to be justifications for any deviation. It is striking that the DoH have devised a regime which deviates so profoundly not only from other fixed costs regimes but also from other Pre-Action Protocols. 
 
The update below gives an insight into some of the issues which are currently undergoing consideration and give an indication into the direction of travel. 
 
In their update they advised that: 
 
- Plan is to make final decisions on the rules in the June CPRC meeting with the rules to come into force in October. Confirmed draft materials will be published as soon as possible to help Practitioners to see what is coming. What we do know is that the Protocol is still not finalised yet. 
 
- Concerns were expressed that the draft Pre-Action Protocol was not numbered correctly and that work would be required to amend this prior to the publication of the draft rules. It was said this was a large reason the rules could not yet be published in draft. 
 
- Concerns were also expressed on the interaction between the penalty system for late service of documents and how this works with the unreasonable behaviour system and whether these cover the same things and specifically how they would operate side by side. The DoH’s view is that it is felt there is merit in having more specific targeted sanctions to ensure compliance with the Protocol by all parties. Their proposal is a 5% uplift applicable to damages (not costs) for Claimants where a Defendant breaches a deadline and a 5% decrease on fixed costs for Claimant deadline breaches (up to maximum of 15%). They stated that the unreasonable behaviour sanction is meant to come after the individual sanctions but the intention is that deadline breaches would not amount to unreasonable behaviour to avoid double counting. CPRC expressed concerns that Defendant could end up better off with a 15% damages sanction rather than a 50% costs sanction. CPRC’s view was that justification is needed to have different sanction regimes for Clinical Negligence claims compared to all other fixed costs claims which do not have targeted sanctions. This was an issue which would require resolution at a future meeting. 
 
- In addition, concerns were expressed about the application of the Clinical Negligence Fixed Costs scheme to Protected Parties and how it works where a case on the Protocol is issued given the Protected Party would be exempted from fixed costs. Further concerns were set out at how the targeted sanctions would work given Protected Parties are exempt from fixed costs post-issue. The DoH advised the policy intent is to include Protected Parties and Children in the fixed costs proposals, a stark contrast to the wider FRC regime. The concern is that the unreasonable behaviour sanction does not apply to Protected Parties in non-Clinical Negligence claims. The DoH stated they will look again at this issue but simply restated the policy intent was to include Protected Parties and Children. The CPRC stated their ought to be justification as to why they would be treated differently in Clinical Negligence claims. 
 
- The CPRC also expressed concerns at how each sanction is to be calculated where there are multiple percentages and that this would need to be clear in the finalised rules. 
 
- Also concerns shared about how Part 36 will work given that there is only one stage in the Clinical Negligence Fixed Costs proposals and the current wording of Part 36 envisages multiple stages. This is already a complex point in the wider Fixed Costs Regime which is leading to confusion. Again this is another potential uplift on top of the individual deadline sanctions, unreasonable behaviour and Part 36. Essentially fixed costs calculations can get very complicated, particularly where part of a claim could be fixed costs and another part of it may not be (as with Clinical Negligence). 
 
- Parties will have to set out why a claim is not brought within the Lower Value Clinical Negligence Damages Protocol within the Claim Form if not used. The CPRC stated that they did not believe there was any other Protocol requiring this and this was therefore a consistency point. Again there would need to be justification to treat Clinical Negligence claims differently. This is an issue which would require further consideration. 
 
- There is a bolt-on for Protected Parties and Children and the issue of costs for approval process is intended to be separate. There was a suggestion Part 8 application costs may be limited to the fixed application costs in Table 1 of the Practice Direction 45, if so then this could see fixed costs as low as £250 plus VAT. It is not clear how this would work given Table 1 fees bear relationship to complexity bands which don’t exist in the LVCD regime. Another area which will require scrutiny whenever the rules are published. 
 
- London Weighting will apply as it does in the wider Fixed Costs Regime. This provides an uplift where a client and the firm acting are both based in specific areas of London. 
 
- Intention is that Litigants in Person will not be in the scope of the LVCD FRC regime. Litigants in Person will be excluded from Clinical Negligence Fixed Recoverable Costs. Ultimately it would be too difficult for a Litigant in Person to follow the Pre-Action Protocol. 
 
- Questions & concerns about how rules will impact individuals going through the complaints process and a need to be clear as to how the reforms will impact them. This could see people going through the complaints process disadvantaged if, as a result of the time the complaints process takes, end up under the new fixed costs regime as opposed to the current costs regime. No clarity yet though on how implementation will work though previous proposals were implementation would be tied to date of the Letter of Notification / Letter of Claim. It’s good to see the Committee considering and raising this issue with the DoH. 
 
It was acknowledged that there are a lot of amendments still to work through and for the Clinical Negligence fixed costs rules to be signed off at the next meeting then they were going to have spend a lot more time on them. Comments were made of concerns that the timing may well not be realistic. It was said that “heroic work” was required and that there was a “real chance” at the June meeting they won’t be able to say “done”, as they hope. The questions raised today will be revisited in June’s meeting and if they cannot be resolved then they will have to be pushed back to the next meeting in July. It’s not clear what impact (if any) this could have on the proposed October implementation. 
 
The DoH want to publish the draft Pre-Action Protocol but the CPRC stated the draft currently available to them is not capable of publication. Unhelpful to Practitioners waiting to be able to plan for the future. 
 
Determination of Fixed Costs 
 
Mr Justice Trower provided an update on the rules around Fixed Costs Determination which appear to be largely finalised. 
 
One point which was raised was that the rules for the Determination Process will make it clear that the Court has the power to undertake both determination & assessment under the fixed costs rules. Mr Justice Trower stressed, however, that assessment and determination were distinct. Most fixed costs disputes will be determination. 
 
The three instances of assessment under Part 45 would be: 
 
- Where there are Exceptional Circumstances. 
- Where the Vulnerability Test is applied. 
- For Stage 1 Non-PI Intermediate Track fixed costs. 
 
The latter is of the most interest as there had been questions about rule CPR 45.50(3) which provides that: 
 
(3) The costs to be awarded for stage S1 are subject to assessment up to a maximum of the figure shown for stage S1 in Table 14, except in a claim for personal injuries where the figure shown is fixed. 
 
We now know that where Stage 1 Non-PI Intermediate Track Fixed Costs are not agreed between the parties then the Fixed Costs Determination process will allow parties to apply for assessment. Presumably this will require some form of schedule or bill. Our understanding is that there is consideration into whether a new short-form bill could be introduced though there is no final decision upon this yet. We will need to see the full rules of the Fixed Costs Determination to understand how it will work. It will be interesting to see how many practitioners use the assessment process in such circumstances. 
 
One of the questions we raised to the CPRC was about how the assessment process for S1 Intermediate Track costs would work and why costs in Non-PI cases were capped rather than fixed. Mr Justice Trower advised that the decision for a capped rather than fixed amount pertains to Sir Rupert Jackson’s comments that non-PI claims can require less work than PI claims to achieve a pre-action settlement and settlements can be generally achieved more quickly pre-action in Non-PI claims. This is, perhaps, not a view shared by all. 
 
Turning to the issue of how assessment will work, Mr Justice Trower said the new Fixed Costs Determination Process will give the Court wide discretion to provide directions on how any assessment will ultimately work. We will have to wait to see the Statutory Instrument later this summer that will provide us with details of the new rules to get a greater understanding of how matters will work. 
 
Costs Budgeting Reforms – State of Play? 
 
A question was raised to the Committee about when Costs Budgeting Light & other Budgeting Pilot Schemes would be implemented and how they were intended to work. 
 
The CPRC stated that there was a small working group looking at the CJC recommendations and are planning to having a detailed draft concerning Costs Budgeting Light to put forward at June’s CPRC meeting. In terms of implementation and timescale it depends upon when the rules themselves are approved but it is likely that the pilot will run for 2 years (but this is not fixed). 
 
This update suggests an October or April implementation could be possible, though clearly there is no certainty yet on this. 
 
The Committee would not be drawn on any features, rules or specifics at this stage. 
 
Fixed Recoverable Costs & Inflation 
 
On the subject of further uprating for Fixed Recoverable Costs such as Portal costs, the CPRC stated that this is something the Ministry of Justice were considering but would require further evidence gathering. What we do know is that this is something on the agenda, though nothing imminent is planned. 
 
Portal & Part 36 Costs Consequences 
 
For those running Portal cases if they beat their Part 36 offer they would not be entitled any uplift save for on interest. We asked the Committee to clarify whether there is an intention to bring the Part 36 consequences in line with those set out for Fixed Recoverable Costs, namely the 35% uplift on costs as detailed within 36.24(4). 
 
Mr Justice Trower acknowledged that this was something which required consideration and confirmed this question would be included in the CPRC’s Fixed Recoverable Costs Stocktake due to take place next year. Hopefully, we will see consistency in the approach to Part 36 costs consequences to give Part 36 in Portal cases a bit more bite. 
 
Agency Fees 
 
We asked the CPRC whether there was any intention to consider whether clarification in the rules were needed over: 
 
a. Whether or not parties should or should not be required to give breakdowns between medical expert fees and agency fees; and 
 
b. Whether agency fees are recoverable, in principle, in fixed costs claims. 
 
On the second point the CPRC said that the point about recoverability of agency fees in fixed costs claims is something which they would add to next year’s Fixed Costs Stocktake. It is possible within that timeframe we may well see case law develop, though it is good to know this is an issue they are prepared to consider, in the event there is nothing binding in the short to medium term. 
 
On agency fee breakdowns generally, no response was forthcoming so it remains to be seen how this issue will develop in the short to medium term but there is no indication that it is an issue on the CPRC’s agenda. 
 
Provisional Assessment Cap 
 
Sir Geoffrey Vos responded to our question about the Provisional Assessment Cap. We had reflected that the Provisional Assessment cap which applies to the costs of Provisional Assessment has remained unaltered since its inception in 2012 at £1,500 plus VAT. We made clear that Guideline Hourly Rates have increased twice since this time (and will now be subject to annual inflationary review) leaving Practitioners with less time to do the same level of work compared with 10 years ago. We added that the Bank of England Inflation Calculator showed that if inflation were applied to the cap then it would now exceed £2,000 plus VAT and consequently we asked whether the Provisional Assessment cap would now be increased as other elements of costs have been? 
 
The Master of the Rolls acknowledged this question had been raised multiple times and as such asked LJ Birss, head of the Costs Sub-Committee to review the Provisional Assessment cap and whether it should be changed. It is a question we have raised previously, repetition it seems (in this circumstance at least) has helped get a development on a point which is important to many costs practitioners. 
 
The Future? 
 
We can see there are a lot of different developments underway and lots of unknowns remain ever present. We at Carter Burnett are monitoring all developments and will continue to share and report on these. We will always help and assist in any way that we can. 
 
Should you have any queries arising from this article or upon costs generally then please do not hesitate to get in touch with our friendly team either via phone 01482 534567 or e-mail info@carterburnett.co.uk. 
 
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