Commercial court costs budgeting to be raised to £10m

The £2m cost budgeting threshold for commercial cases in the UK courts has been raised to £10m, bringing a raft of civil cases under stricter budgeting measures.

Following the year-long review of civil litigation costs by Lord Justice Jackson in 2010 a budgeting regime was introduced for cases valued under £2m across the Chancery, Mercantile and Technology and Construction Courts (18 January 2010). The Commercial Court and the Admiralty Court avoided the regime following opposition from the bench.

However at a recent meeting of the Civil Procedure Rules Committee (CPRC), chair Lord Justice Richards and Master of the Rolls Lord Dyson threw their weight behind raising the exemption to include cases under £10m.

The CPRC has now committed to the new limit, meaning cases valued at £10m and under will have to comply with stringent measures.

Until now commercial barristers have battled against other factions of the law, which argue that it is wrong for things like clinical negligence cases worth £5m to be subject to mandatory budgeting while commercial cases worth £2.5m are not.

The argument has caused a rift among barristers on both sides. At the recent meeting several CPRC committee members wanted to see the current £2m regime raised to £15m, a move that would require a raft of litigators to set out budgets. However Lord Dyson MR and Richards LJ said £10m was a good “starting point, subject to review”.

The exemption from costs budgeting rules for cases worth more than £10m will apply across all courts, but a discretion will still exist for judges to order budgeting in cases above the limit if they wish.