Mandatory use of the New Bill of Costs has been postponed

Mandatory use of the New Bill of Costs has been postponed
communicationThe mandatory use of the New Bill of Costs and the underlying J-codes appear to have been postponed for the time being by the CPR Committee. We understand that the Law Society is to carry out a survey of its members about the new bill and J-Codes, and the Ministry of Justice (MOJ) will make a decision about the way forward when that is done.


Practical implications

This news will no doubt be welcomed by many lawyers. It is not the New Bill of Costs per se which has caused concern among the legal profession but the underlying requirement to provide time recording using J-codes—a system of time recording which few firms used prior to the adoption of them by the committee tasked with the New Bill of Costs nor it would seem, anecdotally at least, that many have implemented their use since it became apparent that J-codes would be required when completing the New Bill of Costs.

What is not clear for practitioners is whether they should still be considering the use of J-codes when recording time. The CPR Committee has merely stated that it requires time, alongside the MoJ, to consider the mandatory use of the New Bill of Costs given the major implications it would have for the legal profession and no time frame has been set out.

The New Bill of Costs

The use of the New Bill of Costs is currently voluntary under a pilot scheme.

It was originally envisaged that the introduction of mandatory use of the New Bill of Costs based on J-codes would occur at the end of the current pilot scheme (i.e. 1 April 2016).

However, the latest information from the CPR Committee, set out in the draft minutes from the 4 December 2015 meeting, show that the CPR Committee considers the introduction of the mandatory use of the New Bill of Costs to go further than that of a pilot scheme and that its introduction would have major implications for the legal profession. It was therefore agreed that the matter needed to be given careful further consideration by both the MoJ and the CPR Committee and consequently it was too soon for any decision to be taken about its introduction on a mandatory basis.

It was not noted in the minutes whether the voluntary pilot scheme will be continued beyond 1 April 2016 as currently provided for.

The mandatory use of the New Bill of Costs would have involved the New Bill of Costs being used in all cost managed cases in which costs orders are considered by the Senior Courts Costs Office. This was put forward as being a pilot scheme and it was envisaged that it would run for two years to enable information and feedback to be collected and considered.

No definitive stance was taken on whether the mandatory use of the New Bill of Costs would be linked to the date of the costs order, ie any costs order dated after the pilot scheme came into force, or some other date. The mandatory provisions would mean that if the Bill of Costs was prepared under the old method when the New Bill of Costs should have been used, the costs would not be recoverable.

Further, the mandatory use of the New Bill of Costs would mean that even if costs were incurred in, say, 2015 when J-codes had not been introduced the time costs from that period would need to be 'converted' to J-codes for the purposes of the Bill of Costs. The advice being put forward by the Hutton Committee was therefore to ensure that any current time recording contained the required J-codes.

Further information

Subscribers to LexisPSL can find more details on the New Bill of Costs and the J-codes in Practice Note: New Bill of Costs and J-codes. Click here for a free trial.

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About the author:

Janna is a dispute resolution lawyer. She deals primarily with cross border issues and is active in the work being undertaken in relation to the implications of Brexit for Dispute Resolution lawyers. Janna also heads up a LexisNexis costs team bringing together expertise from across the company to deal with the costs issues facing the profession.