Electronic bills sparked fear

The electronic bill of costs has caused panic and denial among judges and solicitors, but matters are improving, research shows.

Both solicitors and judges warned that they did not feel prepared for the electronic bill of costs when it became compulsory in April. In an Association of Costs Lawyers (ACL) survey of 82 costs lawyers published this week, only 10% said all the solicitors they dealt with were ready when the new bill came into force, compared to 56% who said none of them were.

Asked what solicitors’ reactions have been since April, half said there was either a lot of last-minute panicking (13%) or that solicitors had asked the costs lawyer to sort it out for them (37%). One in six solicitors preferred to stick their head in the sand and just put off dealing with it. A mere 6% of costs lawyers said their solicitors had managed a smooth transition to the new regime.

It was no better on the bench. Just 16% of costs lawyers reported that ‘some’ judges were ready for the new bill, while only 5% found that the courts were ‘keen to get going’ with it. Some judges would use their discretion to waive use of the bill for as long as they could, costs lawyers said, while others could not get going even if they wanted as they had still not received the training or technology required.

Attitudes to budgeting are improving, however. One in five costs lawyers said their solicitors are now sticking to their budgets, with 51% saying their solicitors sometimes go over budget. More than a fifth reported that solicitors always go over budget. All these figures show improvements on previous ACL surveys, which have tracked views on this subject twice a year since autumn 2016.

Asked whether a costs judge who reduces the hourly rates for incurred costs should then do the same to budgeted costs, two-thirds (65%) said no—coming within the budget should be sufficient.

More than half (56%) the respondents also called for Court of Appeal guidance on the proportionality test, highlighting concerns about the inconsistent application of the test by judges.

ACL chairman Iain Stark said: ‘It is perhaps no surprise that many solicitors are struggling to come to terms with the new bill of costs, with many yet to have either the technology or the time-recording processes in place.

‘But the time will come, sooner rather than later, when they will literally pay the price for their failure to adapt. Most district and costs judges will not have yet dealt with an electronic bill, due to the time lag in them reaching court, which is fortuitous given some of the delays in providing training and technology.

‘But both judges and lawyers will have to get on top of it—this is, without doubt, the future. With the culture of compliance that has sharpened since the Jackson reforms, I would not be surprised to see judges clamping down on those who wilfully ignore the electronic bill.’

This article appeared in New Law Journal on 30 August 2018.