A "phoney war"?: Master Haworth on costs six months on

For those who were unable to attend the Costs and Litigation Funding conference and didn't manage to follow our live tweeting on the day, we are producing follow up posts summarising each of the key speakers and their practical advice to practitioners.

The first speaker of the day was Master Peter Haworth, Costs Judge at the Senior Courts Costs Office and he spoke about the first six months of the new costs regime, reflecting on what has changed, how the changes seem to be working in practice, any 'teething troubles' and the outlook for the next year.

The following is a summary of our live tweeting:

  • Where are we meant to be going – “costs are disproportionate and are impeding access to justice”
  • Not a lot is happening in costs office – no massive increase in hearings. Still waiting 6 months for a hearing date.
  • It was thought there would be an increase in provisional assessments but this has not turned out to be the case.
  • Primary function of budget is that costs are appropriate and proportionate.
  • Average time spent in relation to costs management by district judges is about 1 hour 30 mins at present.
  • Main area of concern is costs management and costs budgeting. Why has it taken so long to get to this stage of budgeting upfront?
  • Courts are not to micro manage budgets but causes more problems. What about hourly rates? Doesn’t deal with cases where budgets hopelessly inaccurate.
  • Coulson's report on the costs budgeting exemptions is likely to be out 'relatively quickly' (via Rachel Rothwell)
  • Parties should try and agree budgets. CRM Trading Ltd v Chubb Electronic Security Ltd (2013) QBD (Merc) (Judge Mackie QC) (unreported)
  • Slick Seating Systems v Adamas. Budget sum was the award of costs made. No further argument after costs budgeting setting hearing. Important to get it right at the start. No detailed assessment, trial judge in best place to consider costs. Writing is on wall for costs judges!
  • Safetynet Security – budget costs awarded at end of hearing. No detailed assessment.
  • Willis v Rundell – very important case. £1.1 m in damages. Both budgets deemed to be disproportionate. Para 14, Coulson J: “one test of proportionality is whether the trial is likely to be an end in itself, or merely a lesser part of the process which the parties will use in order to put themselves in the strongest position to argue that, subsequently, the other side should pay all or most of their costs. When the costs on each side are much higher than the amount claimed/recovered, the latter is almost inevitable. I have no doubt that that will be the case here. For those reasons, therefore, I conclude that the costs shown in the costs budgets are disproportionate and unreasonable”.
  • Take up of costs management orders is currently 10% or less.
  • Major benefit of CMOs is that it engenders settlement in some circumstances.
  • It is worth noting that you should apply for extensions well before the time limits expire.
  • Need to make sure costs budget has contingency for trial overrunning etc. e.g cost trial on daily basis
  • Fact you have come in budget doesn't necessarily mean you should get the whole budget awarded but isn't always the case.
  • Is costs budgeting going to save money? Yes, if garners a settlement but not if all time is spent arguing about the costs.

@LexisUK_DR

Master Peter Haworth was appointed a Master and Cost Judge at the Supreme Court Costs Office in July 2006. Before that he was a solicitor in private practice for 30 years. He has been and remains a Deputy District Judge on the Northern Circuit for 14 years and was a Deputy Master for five years. He is a former member of the Civil Procedure Rules Committee.

Filed Under: Costs & Funding

Relevant Articles
Area of Interest