Chancery review

Case management is being reviewed by the Chancery division after it decided to abandon costs control measures proposed by Lord Justice Jackson. Here, Katy Dowell examines the latest goings on in civil court management.

Is the senior judiciary rolling back from the costs reform programme proposed by Lord Justice Jackson? Last month’s announcement that costs management will no longer apply to cases valued at above £2m in the chancery is, some litigators believe, a sure sign that it is.

“In some areas of civil litigation costs are disproportionate and impede access to justice,” Jackson LJ stated in his Review of Civil Litigation Costs report (18 January 2010), “I therefore propose a coherent package of interlocking reforms, designed to control costs and promote access to justice.

Yet two years on those reform are in danger of being watered down. And it all started so well.

After the report was published, the Birmingham Technology and Construction Court (TCC) and Mercantile Court put in place a costs pilot that was to be rolled out to all cases where the first case-management conference was scheduled after 1 October 2011. The pilot ran until the end of September 2012.

Among other things, the pilot required litigating lawyers to devise a costs schedule that was to be presented to the courts and that could be subjected to a costs management order. In addition, the court said that when assessing costs it would not depart from the approved budget unless there was good reason for it to do so.

The whole scheme was designed to bring focus to costs management across all levels of cases, regardless of their value.

Jackson LJ, however, stopped short in his report of stating that the costs regime should be applied to all cases in the admiralty and commercial courts.

For the Commercial Court, which competes on the international stage and attracts some of the world’s wealthiest litigants, a programme that could potentially restrict how much litigants can spend would be a backward step. Many litigators believed that the sprit of Jackson should be embraced by the court but the formal structures should not.

And so it was that costs budgeting would be applied to all cases in the Chancery division, the TCC and the Mercantile Court.

The commercial and chancery divisions have been moving towards a more co-operative relationship for some time. The fact that they are both based in the Rolls Building is testament to this. The first case to be heard in the court building was Berezovsky v Abramovich – a case that was co-managed by commercial division head Mrs Justice Gloster and chancery judge Mr Justice Mann.

Many chancery specialists are questioning why, then, at the eleventh hour the president of the QBD Sir John Thomas and Chancellor of the High Court Sir Terence Etherton made the announcement that costs budgeting would not be applied to cases worth more than £2m.

Some suggest that the costs budgeting regime threatened to divide this improving relationship by encouraging litigants to forum shop between the courts. What was needed, the Jackson implementation committee was told, was a level playing field between between the courts, not another differentiator between them.

The reality is that Jackson LJ’s reform programme, intended to spread across all cases, has in fact been blunted by this move. And it is not just in the area of chancery cases that the regime has been altered beyond recognition.

In the area of defamation, for instance, the Government has largely ignored his suggestions and instead attempt to focus on the Leveson report.

In personal injury, the Ministry of Justice has followed the Jackson reform programme by overhauling how the road traffic accident (RTA) claims portal is managed. Traditionally the portal was used for claims valued at less than £10,000 with a fee of £1,200.

In the coming months that will change so that fixed costs of £800 will apply to all RTA claims worth between £10,000 and £25,000, while employer and public liability (EL and PL) claims costs are to be introduced for the first time and set at £900 for lower-value cases and £1,600 for cases up to £25,000. It is worth remembering that the Labour government also considered whether EL and PL claims should be included in the costs ports when it was first introduced, but rejected the plan for fear it would impact claimants.

There is no doubt the regime change will impact firms that have built businesses on personal injury claims. Some suggest the move will block access to justice while others say it will prevent claimant firms from inflating costs and, in the long term, help reduce motor premium prices for all. Evidence of this remains to be seen.

At the other end the legal hierarchy, however, litigants will be able to spend what they like, albeit subject to the current costs control measures. That is not to say that the chancery division will escape any reform. Mr Justice Briggs has been asked by the Chancellor to review working practices in the chancery with an eye on reform post-Jackson. He is working alongside Mr Justice Newey and a panel of 11 advisers from the bench and bar (see full list below).

Briggs J wrote to Chancery Court users at the end of last month stating: “The review encompasses all aspects of chancery practice and procedure, but with a particular focus on case management, judicial resource allocation and the interests of self-represented litigants. Newey J and I come to this task with no pre-conceived notions as to what needs to be changed, or how.”

The judiciary is not subscribing to the entire reform programme but it is considering what impact the new costs regime will have. The outcome of the Briggs J review, expected early next year, will shape the Chancery Court going forward. It may not have escaped the costs control measures just yet.

The chancery practice and procedure advisory group:

Senior Registrar Baister – solicitor and the Chief Bankruptcy Registrarsince 2004

Doug Bell – Senior listing Officer for the Chancery

Tom Coates – Lewis Silken head of litigation

HH Judge Dight – specialist chancery judge and diversity and community relations judge

Tim Fancourt QC – Falcon Chambers

Mr Justice Floyd – has served as a High Court chancery judge since 2007

Robin Knowles QC – South Square, called 1982, took silk 1992

HH Judge Pelling QC – Northern circuit judge, appointed 2006

Tim Pollen – co-chair of the Rolls Building business managers’ group