Proposal for all claims up to £250,000 to be subject to Fixed Costs

Friday, 29th January 2016

Lord Justice Jackson has called for fixed costs to apply to all claims up to a value of £250,000

A sliding scale for costs was presented in Westminster, appearing to follow on from the government’s consideration of applying a similar fee limit for clinical negligence claims in August 2015.

It is proposed that fees ought to be limited to:

a) £18,750 for claims up to £50,000

b) £30,000 for claims up to £100,000

c) £47,500 for claims up to £175,000

d) £70,250 for claims up to £250,000

We note that is exclusive of VAT and disbursements.

The motive behind Lord Justice Jackson’s proposal seems to be to keep costs in line with the court’s overriding objective to ensure claims are handled at a proportionate cost. It may also make solicitors more accountable for the level of costs to their clients.

Whilst the proposal is likely to be criticised by both claimants’ and defendants’ solicitors, particularly in view of the implementation of Precedent H Costs Budgets designed to keep costs at a modest level, we firmly support Lord Justice Jackson’s proposal. Whilst we appreciate that the complexity of claims do not always reflect their value, initiatives such as capping costs of pre-action correspondence at £5,250 for claims up to £100,000 could deter spurious claims from being pursued or at least stagnate their development. We are therefore particularly interested to see how this proposal can aid insurers and their insured clients and will keep readers updated on further developments.

For more information please contact Alex Delin, Solicitor

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