Are Guideline Hourly Rates too low?

Are Guideline Hourly Rates too low?

Solicitors can charge any hourly rate they wish for their services but will they be able to recover those costs from the other side if, and when, their client wins the case?  There are two hurdles which may prevent this.  The first is costs budgeting in which the court may consider the hourly rates to be disproportionate to the matter and the second is the use of Guideline Hourly Rates (GHR). The GHRs are intended to assist judges in carrying out summary assessment but they are widely used as a starting point by the courts when determining the reasonableness of rates claimed on detailed assessment as well.

The GHRs used to be set by the Master of the Rolls but the Government announced on 31 October 2012 that this role would be transferred to the Civil Justice Council from January 2013. The CJC has set up a costs committee to do this and it has met a couple of times to discuss the way forward see: CJC costs committee first meeting and CJC costs committee second meeting.

Feedback sought from practitioners

Last week the committee announced that it would be making available a  survey from Friday 1 November until Friday 29 November asking for feedback from practitioners on the use and impact of GHRs.  The survey is seen by the committee as an important step in establishing new GHRs. The committee in announcing the survey stated that it:

‘wishes to encourage every law firm in England and Wales to respond to the questionnaire to ensure the evidence base is as comprehensive as possible, reflecting a wide range of factors concerning the costs of legal services up and down the country and at all levels of practitioner seniority.’

For further information click here.

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About the author:

Janna is a dispute resolution lawyer with a Masters in Construction Law and Dispute Resolution. During her time in private practice at both Herbert Smith and Denton Wilde Sapte (now Dentons) she worked on complex international disputes, both litigation and LMAA arbitrations, dealing with technical cross border issues.

Janna deals primarily with cross border issues and is active in the work being undertaken in relation to the implications of Brexit for Dispute Resolutions lawyers. She also heads up a LexisNexis costs team bringing together expertise from across the company to deal with the costs issues facing the profession and was a contributing author for the Cook on Costs supplement dealing with the Jackson reforms. Janna is a frequent contributor to the legal and professional press, including the New Law Journal and Counsel magazine.