Insurance & Reinsurance
The new four-strand litigation costs consultation, launched on 30 June 2022 by the Civil Justice Council (CJC) of England & Wales, is not just a technical exercise about adjusting rates or changing fee levels. It emphasises the critical point that “access to justice for all plays a vital part of the rule of law in a democratic society and that affordability is fundamental to such access.”
Litigation costs represent a significant proportion of claims spend in any particular category of civil litigation or type of insurance claim. Flagship reforms have been undertaken from time to time - notably the Jackson review in the early 2010s and the Woolf reforms a decade or so before that. Discrete issues are addressed periodically by technical rule changes or uplifts to recoverable hourly rates.
That said, the momentum around the delivery of digital justice has been accelerated by the experience of working through the COVID-19 pandemic and is a key priority for senior judges, in particular the Head of Civil Justice, Sir Geoffrey Vos MR. He has set out his vision of “a single online funnel” for all civil claims. Developments such as the wider use of portals, the online money claims system, mandatory Courts Electronic (CE) filing and the establishment of a digital procedure rules committee must now be seen through that lens.
The new four-strand consultation on costs, launched on 30 June 2022 by the Civil Justice Council (CJC) of England & Wales, should not be treated as just a technical exercise about adjusting rates or changing fee levels. Although its remit covers costs budgeting, guideline hourly rates, costs under pre-action protocols/portals and the digital justice system, and consequences of the extension of fixed recoverable costs, it is billed as a “a strategic and holistic look at costs”. It emphasises the critical point that “access to justice for all plays a vital part of the rule of law in a democratic society and that affordability is fundamental to such access.”
The consultation paper (available here) poses 17 questions over four main themes. The deadline for responses is 30 September 2022 and submissions will be analysed closely by the CJC and presented in a report that will “set the direction of travel for costs [and] will not descend into detailed rule making”. An early milestone in the consultation process will be the CJC’s costs conference on 13 July 2022. This will involve a wide range of stakeholders, including Paul Wainwright, head of costs and Alastair Kinley, director of policy at Clyde & Co.
Costs is often regarded as a rather dry area, but it represents the economic engine of all civil litigation and is a key driver of behaviour. Reforms to the core aspects of the new consultation - digital justice, costs budgeting, extended fixed recoverable costs, wider use of online portals and a fundamental shake-up of hourly rates - will disrupt current approaches to all stages of most types of civil litigation. So it really is a “a strategic and holistic look at costs” and getting involved during the next three months and beyond will be of key importance for ‘repeat players’ in civil litigation, such as our insurance, corporate and institutional clients.
Our communications and events that will follow the CJC’s conference in mid-July will mark the start of our engagement with the consultation. We will provide an update on our thoughts and insights on the four main issues and key themes of debate from the July conference.
As the consultation process moves forward, we will deliver further briefings and a webinar to bring the potential impact of these issues to a range of clients, to walk through the issues raised and provide an opportunity to shape your individual or collective responses before the consultation window closes at the end of September. We look forward to seeing you at this event and to working together to address the opportunities within this reform process.