Jackson report: a new court track and a new world of fixed fees for claims up to £100,000

The long awaited results of Lord Justice Jackson’s review of the civil fixed recoverable costs (FRC) regime in England and Wales were unveiled yesterday.

Jackson LJ has set out a blue print that will bring, if implemented, a grid of FRC for all fast track cases and a new ‘intermediate’ track for certain claims up to £100,000.

In concluding that the reforms as proposed in his 2010 report have now bedded in, Jackson LJ has recommended:

  • A grid of FRC for all fast track cases.
  • A new ‘intermediate’ track for certain claims up to £100,000 which can be tried in three days or less, with no more than two expert witnesses giving oral evidence on each side.
  • A Department of Health-led working party to develop a bespoke process for handling clinical negligence claims up to £25,000 (with a grid of FRC attached).
  • A voluntary pilot of a ‘capped costs’ regime for business and property cases up to £25,000, with streamlined procedures and capped recoverable costs up to £80,000.
  • Measures to limit recoverable costs in judicial review claims.

Where the defendant fails to beat a Part 36 offer within the new track, Jackson LJ also makes a tentative proposal that there should be a 30% or 40% uplift on costs rather than indemnity costs.

Download: Executive Summary, Review of Civil Litigation Costs: Supplemental Report Fixed Recoverable Costs by the Right Honourable Lord Justice Jackson (PDF, 87KB)

The fast-track

Jackson LJ recommends that all fast track cases be placed into four bands of complexity – Band 1 being the least complex and Band 4 being the most complex. The following are paradigm cases for each band:

  • Band 1: RTA non-personal injury claims, defended debt cases.
  • Band 2: RTA personal injury (within protocol), holiday sickness claims.
  • Band 3: RTA personal injury (outside protocol), employers’ liability accident, public liability, tracked possession claims, housing disrepair, other money claims.
  • Band 4: Employers’ liability disease claims (other than noise-induced hearing loss), any particularly complex tracked possession claims or housing disrepair claims, property disputes, professional negligence claims and other claims at the top end of the fast-track.

The proposed recoverable costs for each band is as follows:

Matrix for FRC fast track

Stage Band 1 Band 2 Band 3 Band 4
Pre-issue
£1,001 - £5,000
  £104 + 20% of damages £988 + 17.5% of damages £2,250 + 15% of damages + £440 per extra defendant
Pre-issue
£5,001 - £10,000
  £1,144 + 15% of damages over £5,000 £1,929 + 12.5% of damages over £5,000 £2,250 + 15% of damages + £440 per extra defendant
Pre-issue
£10,001 - £25,000
£500 £2,007 + 10% of damages over £10,000 £2,600 + 10% of damages over £10,000 £2,250 + 15% of damages + £440 per extra defendant
Post-issue, pre-allocation £1,850 £1, 206 + 20% of damages £2,735 + 20% of damages £2,575 + 40% of damages + £660 per extra defendant
Post-allocation, pre-listing £2,200 £1,955 + 20% of damages £3,484 + 25% of damages £5,525 + 40% of damages + £660 per extra defendant
Post-listing, pre-trial £3,250 £2,761 + 20% of damages £4,451 + 30% of damages £6,800 + 40% of damages + £660 per extra defendant
Trial advocacy fee a. £500
b. £710
c. £1,070
d. £1,705
a. £500
b. £710
c. £1,070
d. £1,705
a. £500
b. £710
c. £1,070
d. £1,705
a. £1,380
b. £1,380
c. £1,800
d. £2,500

Intermediate track

As above, bands will be based on complexity: a quantum only personal injury claim being typically suitable for Band 1 and a business dispute or serious issues of fact/law warranting a trial up to three days suitable for Band 4.

The proposed grid for the new track is set out in table 7.1 of the report and is underpinned by assumptions of the ‘process’ and ‘efficiency’ savings it will bring.

Matrix for intermediate track 

Stage (S) Band 1 Band 2 Band 3 Band 4
S1 Pre-issue or pre-defence investigations £1,400 + 3% of damages £4,350 + 6% of damages £5,500 + 6% of damages £8,000 + 8% of damages
S2 Counsel/specialist lawyer drafting statements of case an/ or advising (if required) £1,750 £1,750 £2,000 £2,000
S3 Up to and including CMC £3,500 + 10% of damages £6,650 + 12% of damages £7,850 + 12% of damages £11,000 + 14% of damages
S4 Up to the end of disclosure and inspection £4,000 + 12% of damages £8,100 + 14% of damages £9,300 + 14% of damages £14,200 + 16% of damages
S5 Up to service of witness statements and expert reports £4,500 + 12% of damages £9,500 + 16% of damages £10,700 + 16% of damages £17,400 + 18% of damages
S6 Up to PTR, alternatively 14 days before trial £5,100 + 15% of damages £12,750 + 16% of damages £13,950 + 16% of damages £21,050 + 18% of damages
S7 Counsel/specialist lawyer advising in writing or in conference (if instructed) £1,250 £1,500 £2,000 £2,500
S8 Up to trial £5,700 + 15% of damages £15,000 + 20% of damages £16,200 + 20% of damages £24,700 + 22% of damages
S9 Attendance of solicitor at trial per day £500 £750 £1,000 £1,250
S10 Advocacy fee: day one £2,750 £3,000 £3,500 £5,000
S11 Advocacy fee: subsequent days £1,250 £1,500 £1,750 £2,000
S12 Hand down of judgment and consequential matters £500 £500 £500 £500
S13 ADR: counsel/specialist lawyer at mediation or JSM (if instructed) £1,200 £1,500 £1,750 £2,000
S14 ADR: solicitor at JSM or mediation £1,000 £1,000 £1,000 £1,000
S15 Approval of settlement for child or protected party £1,000 £1,250 £1,500 £1,750
Total: (a) £30,000, (b) £50,000, (c) £100,000 damages (a) £19,150
(b) £22,150
(c) £29,650
(a) £33,250
(b) £37,250
(c) £47,250
(a) £39,450
(b) £43,450
(c) £53,450
(a) £53,050
(b) £57,450
(c) £68,450

Next steps

If his proposals are accepted, Jackson recommends a review of the arrangements after four years. If working satisfactory, consideration should then be given to expanding the scope of the intermediate track to include monetary claims above £100,000.

For now, it will now fall to the government to consider Jackson’s report and consult, accordingly. It, therefore, remains vital for all those with a vested interest to feed in their views to the policy-making process. Ahead of his retirement in March 2018, Jackson aptly concludes – “the baton now passes to others”.

Comment 

The devil will be in the detail of the rules and there will be a large portion of the claimant fraternity that will review the proposed grid for the intermediate track in horror. The low end multi-track arena has been a lucrative area for many claimant firms and the suggested bands look to reduce significantly their revenue in these areas.

Our expectation is that we will see a gentle, gradual implementation of these proposals – as opposed to a sudden shift of the goal posts. Whilst our reaction is positive, we offer a note of caution in respect of the test litigation that these proposals, if implemented, will produce. There is likely to be much argument about which band is correct as both sides scrutinise the draft rules for any opportunities to gain tactical advantage.

We may also see behavioural changes from parties, including claimant firms in an attempt to protect revenue streams (as was seen after the initial Jackson measures of 2010). The financial drivers of the new track may, therefore, see claimant firms seeking to exploit any grey areas and testing the boundaries of the rules once drafted.

Whether the proposals will meet the overriding objective of making the costs of going to court more certain, transparent and proportionate for litigants waits to be seen. However, they are a step in the right direction. Jackson has provided the Rules Committee the clear opportunity to draft a workable framework of rules for the extended regime.

Related item: Jackson review of fixed recoverable costs (18 November 2016)