Change In Ability To Recover Costs From The Losing Party.

From October 1st 2023 a fixed costs regime will be implemented for the majority of claims for damages up to £100,000.

This means that, whereas under the current costs rules, the winning side is usually able to recover a substantial amount of their reasonably incurred costs, after the change they will only be able to recover costs up to a fixed amount, no matter what the total costs incurred are.

This is likely to result in the winning party having to pay a higher percentage of their own legal costs, whether bringing or defending a claim.

It will also likely increase the emphasis on attempting to settle disputes prior to issuing claims at court and allow claimants to assess their likely exposure to costs if they were to lose their claims.

These changes come into effect on any claims issued after the 1st October  – for prospective claimants currently considering making a claim, it may prove beneficial (from a costs perspective) to issue their claims beforehand – this is an area in which Wilson Browne offers a skilled and efficient litigation team, able to assist in such matters.

If issuing after the implementation date, some security can still be retained through the conduct of pre-action dispute resolution and the making of part 36 offers, however, this only results in a percentage increase in the costs available compared to the fixed costs, not the actual costs incurred.

Litigation teams will need to act accordingly in order to secure the best scenario for their clients going forward and shield them from any potential adverse cost orders against their clients.

Claims that will likely be allocated to the multi-track are not affected by this,  as this is claims that are for values over £100,000; are not for monetary award; or are of a higher complexity, involving more parties.

Part 8 claims are also not affected by this change or claims for non-monetary awards.