Costs budgeting obligations lifted

Proposed costs management programme derailed at the final hour

Jackson LJ

Is the senior judiciary rolling back from the costs reform programme proposed by Lord Justice Jackson?

The fact that costs management will no longer be applied to cases valued at above £2m in the chancery is, some litigators believe, a sure sign that it is.

Following a pilot in the Birmingham Technology and Construction Court (TCC) and Mercantile Court, the costs management programme should have been fully implemented by 1 April, with the exception of the Commercial Court.

Under Jackson LJ’s proposals, counsel appearing in the Chancery division, the TCC and Mercantile Court would need to devise a costs schedule for presentation to the courts and be subject to a costs management order.

The scheme was designed to focus on costs management across all cases. However, some feared that it would encourage forum shopping between the courts as litigants might favour the Commercial Court to void costs control.

Some suggest that the costs budgeting regime threatened to divide the improving relationship between the courts. The Jackson implementation committee was told that a level playing field was needed between the courts.

Hence it was decided that the obligations on the Chancery division, the TCC and the Mercantile Courts should be lifted.

While there will be no formal rules, the costs regime will remain at the forefront of judicial thinking on case management.