Monday 24 June 2013 by Suzanne Burn

The first article in this series covered covered costs budgeting (see tinyurl.com/cxjqkjv ). This is part of case management. Several other changes were made to this on 1 April in parts 3, 16-19, of the Civil Procedure Rules, including:
1. It should be more robust, and wherever possible multi-track cases should be case-managed by the same judge throughout (docketing)(not in the rules but guidance given to judges).

2. Replacement of the allocation questionnaire (AQ) (see rules 3.7, 3.7A and part 26) by new directions questionnaires (DQs). AQs serve little purpose in small claims or in the High Court, where all claims are multi-track. There is a new simple DQ for Small Claims Track N180 (to find out whether the parties are willing to try the free small claims mediation scheme and collect email and telephone contact details), and a longer one for Fast Track and Multi-Track N181 with new questions on disclosure (see below), on the costs of expert evidence (see below), and on costs and the costs budget (for multi-track cases only).

3. Where defences are filed after 1 April 2013 a court officer will:

  • decide, provisionally, the track which appears most suitable for the case (by value) (rule 26.3 (1)(a)). This does not fetter judicial discretion (rule 26.5(1)), because on the filing of completed questionnaires, the judge can order the appropriate track (not necessarily by value).
  • serve on the parties a new notice of proposed allocation (N149A small claims, N149B fast track and N149C multi-track).
  • order the parties to file the appropriate questionnaire (and in the case of litigants in person send it to them) at a named court by a specified date (within 14 days for small claims and 28 days for all other claims), and to serve it on the other parties (rule 26.5(1) - a useful rule change, as previously this was only encouraged, not required).

4. If DQs are not filed on time, the party's statement of case may be struck out (rule 26.3(7A)(b)), or the court may give directions of its own initiative (rule 26.3(8)), or list the case for a costs management conference (CMC), or impose a costs sanction (rule 26.3(10)), or simply make an 'unless order' in the first instance. But for cases issued at the Salford Business Centre, the staff will revert to the pre-October 2012 practice (when the long-running PD51 pilot scheme was revoked) of issuing 'unless orders' when AQs/DQs are missing, before transferring the case to a county court for directions.

5. Standard Specimen Directions are available at tinyurl.com/7eazjn7 for use by judges and parties (rule 29.1(2)), particularly for multi-track cases when CMCs take place after 9 April 2013. Parties are encouraged to agree directions, based upon the specimen ones, amended as necessary (rule 29.4) and submit them at least seven days before any CMC.

6. Costs and case management must be conducted together in multi- track claims (rules 3.12(2) and 3.17). A CMC will usually also be a case/costs management conference (CCMC). The judge's job is to set a proportionate budget and give appropriate directions. The starting point can be either the budget or the directions, but with cross-checks to ensure the directions and budget are compatible. Before CMC/CCMCs, parties must file and serve:

  • DQs;
  • Costs budget in form H (PD3E);
  • Draft directions using the template;
  • Estimates of costs for any proposed expert evidence (rule 35.4(2)); and
  • Disclosure report (rule 31.5(3)(a)).

These combined CCMCs will need time: a minimum of 30 minutes reading for the judge and an hour for the hearing, more if there are several parties or complex issues. Telephone hearings are unlikely to be appropriate where costs budgets need to be set.

7. There is a new power for the court to monitor parties' compliance with orders (rule 3.1(8)). For example, by directions - parties must file a report with the court by X date on compliance with Y order - or the judge might telephone the solicitors. You have been warned.

Part 31 - disclosure

A menu of possible disclosure orders (rule 31.5(6)) now applies to multi-track cases, except personal injury, unless the court orders otherwise. This is:
a. dispense with it;
b. disclose what you rely upon and request specific disclosure from the other party;
c. on an issue by issue basis;
d. where it is reasonable to suppose that a document may contain information which enables the party to advance its own case or to damage the case of another party, or which leads to an enquiry with either of those consequences;
e. standard disclosure; or
f. any other appropriate order, for example 'keys to the warehouse' where a party has large quantities of documents which they do not wish to check through/list but will allow the other party to do this.

Fourteen days before the first CMC, parties must file and serve a report verified by a statement of truth stating what documents they have, in what form and where they are (rule 31.5(3)), estimate the costs of disclosure and select one of the menu options. Not less than seven days before the CMC the parties must meet or speak to discuss and seek to agree a proposal for disclosure. These rules apply where CMCs take place on or after 16 April 2013.

In multi-track cases the parties must also exchange an electronic document questionnaire (PD31B) (with a statement of truth and the person signing must attend the CMC), discuss the use of technology before the CMC, and prepare a summary for the court.

Witness statements (rule 32.2)

The court can give additional directions:
a. identifying or limiting the issues to which factual evidence may be directed;
b. identifying the witnesses who may be called or whose evidence may be read; and
c. limiting the length and/or format of witness statements.
It may not always be possible to use these powers fully at the first CMC in a complex claim when disclosure is likely to be significant, but the new rules should be very helpful when any parties are in person.

Part 35 - expert evidence

The aim of the changes is to better focus expert evidence on issues in dispute and to manage the costs. The new rules apply to applications for permission to rely on expert evidence made after 1 April 2013.

  • Rule 35.4(2) requires an estimate of the costs of any expert evidence on the new DQ.
  • Rule 35.4(3), the court can specify the issues to be covered by expert evidence and the type of expertise necessary.
  • Paragraphs 11.1-11.4 of PD35 - 'hot-tubbing' or concurrent evidence. The court may order that experts from like disciplines will give evidence concurrently, rather than sequentially as part of 'their' parties' evidence. They will be questioned together, first by the judge based upon disagreements in the joint statement, and then by the parties' advocates. The Manchester trial centre pilot suggested that hot-tubbing can save time and costs, and assist the judge in assessing the difference of views between experts.

Costs changes

Summary assessment can be done when a costs budget has been approved. It should be straightforward when the costs of the receiving party are within the budget. N260 is a model statement of costs for summary assessment. Paragraph 9.10 of the costs PD states that the court will not give its approval to disproportionate and unreasonable costs. Detailed assessment - no change to the factors to be taken into account (rule 44.4) except to include the receiving party's last approved budget.

Pre-action costs are not part of an approved budget so must always be subject to detailed assessment, including proportionality. Precedents A-C annexed to the costs PD are model bills for detailed assessment. Part 46 covers special cases as before. One change is rule 46.14(3): costs-only proceedings must be started by issuing part 8 claims (to prevent a party re-litigating a settled claim using part 7).

Part 47 and PD covers procedures for detailed assessment. The only significant change is rule 47.15. Following a successful pilot in Yorkshire, provisional assessment now applies to all bills up to £75,000 (including all costs and disbursements, but not VAT). The court will try to carry out the provisional assessment within six weeks. New rule 47.20 concerns liability for the costs of the detailed assessment proceedings: part 36 applies.

If a receiving party fails to obtain a more advantageous outcome than the paying party's part 36, then two costs awards will be made. The first up to the expiry of the period to accept the part 36 offer in favour of the receiving party, and the second after that date in favour of the paying party. If the receiving party makes an offer that it betters at the detailed assessment then rule 36.14(3) applies: they will be entitled to an additional 10% of the costs up to £500,000, and a further 5% over £500,000 up to a maximum of £75,000.

There is a new rule 52.9A in relation to the costs of an appeal. When costs recovery is normally limited or excluded at first instance (for example, small claims), the appeal court may make an order that the recoverable costs of the appeal will be limited to the extent the court specifies having regard to:
a. the means of the parties;
b. all the circumstances of the case; and
c. the need to facilitate access to justice.

It may not be appropriate to do so if the appeal raises issues of principle.

A final article in this series will deal with the changes to the RTA PI protocol and the introduction of the new employers' liability/public liability PI protocol when the Civil Procedure Rule Committee has finalised these rules.

District Judge Burn sits at Bromley County Court and is a member of the Civil Procedure Rule Committee

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