Costs Budgeting & Costs Management – PLA response


Current Blanket Exception In The Admiralty & Commercial Courts

As our members do not routinely have cases before these courts we do not consider it appropriate to comment upon whether the blanket exception to costs budgeting and costs management in such cases may be unnecessary.

The Current Value Based Exceptions

We favour the retention of a qualified exception for cases in the TCC, Chancery Division and Mercantile Courts and agree that the exception should be framed by reference to financial value, there being no better alternative which would achieve clarity for parties at the outset of proceedings. There is some support amongst our members for a reduction in the financial limit above which the exemption should apply to £1 million. The financial limit should, at the very least, be kept under review.

Part 8 Claims (including Judicial Review)

For the reasons set out in the consultation paper there is a high level of support for Part 8 claims (and judicial review proceedings) to be exempt from costs budgeting and costs management subject to the court having a residual discretion to apply the relevant rules in cases where this is considered to be appropriate.

Other Matters

The Landlord and Tenant Act 1954 (“the 1954 Act”) lays down a time limit for the making of an application to the court on the renewal of leases of commercial premises to which it applies. In the majority of cases such applications are made as a purely protective measure and, following a period of time to enable to parties to agree terms, no further recourse to the court is needed and no order for costs is made. Similar situations arise under the provisions of the Leasehold Reform, Housing and Urban Development Act 1993 (“the 1993” Act).

It is a waste of the court’s time and resources, as well as a waste of costs incurred by the parties, for the court to do anything other than grant an initial stay of applications made under this legislation rather than fix a Case Management Conference and apply the costs budgeting regime.

If it is accepted that Part 8 Claims are to be exempt this would include unopposed lease renewals and claims for declarations which are ordinarily made under Part 8. If it is decided that a blanket exemption should not apply to Part 8 claims, there is overwhelming support for specific exemptions for unopposed lease renewals under the 1954 Act and for applications made under the 1993 Act.