Judge Gage threatens capped fee nightmare for UK lawyers

City lawyers acting in high-value Supreme Court litigation could soon be forced into capping their costs if a hearing next month sets a precedent.

On 14 April, Mr Justice Gage will rule whether lawyers on the huge national organ retention litigation, involving 2,000 families and more than 150 hospitals which retained their relatives’ organs without consent, should agree to fix their costs.

If he does rule in favour of a budget, then he will also, with the help of senior costs judge Master Hurst, decide what each party’s costs should be.

This would be the first time lawyers in any high-value Supreme Court action are made to agree to fixed costs.

Speaking to The Lawyer, one costs master from the Supreme Court Costs Office said that if Judge Gage rules in favour of a budget, then judges will be able to use the ruling to make lawyers cap their costs in the future.

Herbert Smith litigation partner Ted Greeno said it would not be helpful for lawyers to have judges telling them what their costs should be.

“It’s normal to estimate what the other side’s costs will be and clients are generally happy with this service,” he says. “Satellite litigation over costs is enough of a problem already. If we’re forced to agree budgets at the start of a trial, this will bring costs litigation into trials. If everyone starts arguing over budgets, the trials themselves will only get more expensive.”

A spokesperson for the Supreme Court Costs Office said it was not taking a political position on costs budgeting.

The law firms that will be affected by next month’s ruling are South West firm Clarke Willmott & Clarke, representing the families, and Manchester firm Hempsons, which is representing the hospitals.