Simplified Costs Budget Revealed

The Simplified Costs Budget is only 2 pages, in effect a front sheet tab and an assumptions tab. 

 

Both the incurred and budgeted costs are broken down into time, counsel and other disbursements for each phase. Gone are details of how the time or disbursements actually split down. Given budgeting is not meant to address the granular detail then this does make sense. Notably hourly rates are no longer addressed in the budget documents.  

 

The new document alongside claim details includes space for the value of the claim, counterclaim and any additional claim, highlighting the emphasis on the sums in issue when the court undertakes the costs management exercise. 

 

Below the grand total is a total for the approved budget and a separate total for the budgeted costs. Presumably amended front sheets will still, however, be required so parties have an understanding of what has been allowed for each phase. 

 

The assumptions tab is lean, highlighting that the court is unlikely to want to see unwieldy documents, preparing the same is likely to undermine the point of the simplified document. 

 

Practically the lack of detail as to how expert fees may breakdown (particularly in an expert heavy case) could foresee such information having to be delved into during negotiations and any advocacy. 

 

The big question is will the Simplified Costs Budget save time? The answer is possibly some, however, the aggregated figures have to be prepared somehow and the reality is the simplification comes in presentation and less so in preparation. 

 

Intriguingly this document adds an extra column but one which is sensible. It largely mirrors the current Precedent R Budget Discussion Report but splits the budgeted costs claimed / offered by time, Counsel and other disbursements. This ensures consistency with the Simplified Budget itself but also makes sense as it avoids the need for parties to break offers down between Counsel and other disbursements in their written submissions. 

 

The columns for the Judges' comments is split out between time and disbursements. This ought to make the Judges' position clearer but is this going into a level of detail beyond what is required? After all budgeting is meant to be a broad exercise and not prescriptive as to how costs are actually spent. 

 

Strictly speaking there is no formal document for the challenged party to reply though that is much the same with the current form. Some parties prepare written responses anyway. Will the court accept such an approach with the simplified procedure? It seems unlikely. 

 

The Simplified Precedent R is ultimately nothing groundbreaking and will be familiar to those who deal with budgeting currently. 

 

This document has two tabs. The first encompasses a budget front sheet with five sections, incurred, previously budgeted, variation sought and the new total. The fifth section is for completion by the court and is the total budgeted costs allowed or agreed after variation. 

 

The second tab is the variation particulars, essentially the explanation for the change(s) sought. 

 

It has two sections, a table breaking down the additional costs sought, per phase, by time, counsel and other disbursements. There is then a column for the explanation of the variation and a further column for the opposing parties' comments and offer (though their offers are aggregated rather than broken down like the variation is). 

 

There is an additional separate section to detail any additional expert fees sought under the expert report phase. This table has space for expert type and then for additional report fees, conference fees or joint statement fees. There is then a column for the total variation and a further column for what was budgeted previously. Each expert type will have its own row. 

 

This is intriguing as it goes far beyond the detail in the Simplified Costs Budget itself. The Court obviously feeling it needs this level of detail to consider any variation but not to set the initial budget itself. 

 

Again this document will be largely familiar to those who have ever varied a budget before. 

 

 

The three simplified budgeting documents seem to be an evolution of the process rather than a revolution. It'll be interesting to see what level of time is saved and how the court actually approaches matters. 

 

Will parties and the court be happy to deal with budgeting on a broader basis or will they end up having to be armed with breakdowns anyway?  

 

Again, as intimated earlier the simplification comes from presentation (which should be welcomed) rather than in preparation. The same work and thought is effectively required in order to populate the new precedents. 

 

On negotiations and advocacy it will be interesting to see how parties and the court approach the same. With hourly rates no longer set out in the budget documents then the tension remains as to how a proportionate figure is arrived at by the court. Presumably both opposing parties and the court will have rates in mind, even if it is unspoken.  

 

The implementation of the case value on the budget itself suggests the court may have a focus on the sums in issue, though this is ultimately just one proportionality factor.  

 

With the Simplified Budget Discussion Report, if the court sets sums for time and disbursements separately will this conflict with the idea that the phase amount can be spent as the practitioner sees fit.  

 

There are questions to be answered and it'll be interesting to see the approach adopted by both parties and the court as the scheme beds in.  

 

A desire to simplify costs management should be welcomed and it's highly likely that in the coming years (the pilot scheme runs to April 2028) such documents will be rolled out more widely so getting to grips now will give practitioners a headstart.