It’s not a game

Just over a year ago, I was instructed to deal with a claimant’s claim for costs following the conclusion of an unspectacular claim for damages for personal injury. 

The case concerned an employers’ liability claim: liability was admitted within the protocol period, medical evidence was far from extensive and damages were agreed, without the need to litigate, at c.£7k. In short, a typical PI claim in almost every respect.

The claimant’s schedule of costs, drafted by the claimant’s solicitors themselves (a small/medium-sized, provincial firm), was for the biggest part of £60k! Apart from claiming a success fee of 100% (quite wrong in itself, but perhaps ‘forgivable’), I simply could not fathom the purported time-spend of 80-odd hours of a purportedly senior solicitor’s time.

An offer of a little under £8k was made on behalf of the defendant which was met with derision. In fact, it was met with ferocious verbal and written attacks by the claimant’s solicitors. Various offers to accept ridiculous sums were subsequently received and rejected and, despite repeated attempts to explain the defendant’s concerns and desire for a detailed and certified bill of costs, in the absence of acceptance of the offer, matters stagnated.

The claimant’s solicitors maintained their righteous position, insisted that the claim presented was reasonable and supported by their files and even threatened such things as an application for wasted costs should the defendant’s stance not change. That stance was not for changing and eventually, shortly before Christmas 2012, I received a detailed bill of costs prepared by an independent costs draftsman.

The detailed bill of costs totalled c.£20k and in almost every respect differed from the initial schedule of costs. Naturally, the success fee was down to 25% but the hourly rates were much lower, the conducting fee-earners were now identified as being unqualified, self-styled ‘litigation executives’, vast swathes of time had vanished and even disbursements were claimed in sums different to those previously claimed. Additional disbursements were also now claimed, in respect of medical experts/reports of which the defendant had no knowledge.

Notwithstanding obvious and serious doubts as to the veracity of the claimant’s claim for costs, the case was ultimately concluded upon the defendant’s initial offer being accepted by the claimant and the parties agreeing to bear their own costs since it was first made and rejected.

And so, a claim for costs presented at c.£60k was compromised at c.£8k.

Why am I telling you this? In my view, it is cases like that described above which fuelled concerns over the rising costs of litigation and which gave rise to Jackson LJ’s reforms/the fixing of costs in the fast track. Perhaps it wasn’t so much the level at which costs were being agreed/assessed and paid that raised eyebrows but more the level at which costs were being claimed. Certainly, I vividly recall far more interest being expressed in respect of the latter when I was asked for data by researchers a few years ago.

The above tale is far from uncommon in my experience. Exaggeration of costs is seemingly rife, with 50%-plus reductions, even by negotiation, becoming increasingly commonplace. And that’s without more ‘technical’ arguments which might bring about large, even total, reductions (such as those seen regularly prior to the revocation of the CFA Regulations 2000).

I am often told that it is part of the game: with so-called defendant costs ‘muppets’ allegedly working strictly to percentages and without a care for details, claims for costs are ‘padded’ so as to allow such muppets to hit targets while claimants still get their perceived dues.

But it is not a game. If it were, I cannot help but think that shenanigans such as those regaled above are the equivalent of sacrificing one’s queen to protect a pawn. And now it is checkmate, at least in the fast track.