Partner and Costs Lawyer Gary Knight responds to questions raised by Rachel Rothwell, Editor of Litigation Funding, for forthcoming publication
- To what extent has the costs profession evolved since its inception, and have there been any key milestones of particular significance?
I started in costs in 1983 – even then the rules applied to costs were being scrutinised with a proposed simpler format being introduced limiting the number of “chargeable items.” I was advised that we (Costs Draftsmen as we were then known) had “about 5 years” before the need for costs draftsmen would be redundant as the new bills would be much easier to prepare and would be dealt with by Solicitors. At that time the fees for drawing bills was not recoverable between the parties and we were looked at as a necessary evil.
Bills did not get easier indeed they became much more complex.
It became necessary to replace the documents section, usually a continuous paragraph highlighting important steps and claiming a block time, with a detailed schedule showing when work was done, nature of the task time spent and by whom.
We then saw the introduction of Points of Dispute which removed the need to anticipate every challenge likely to be made in advance of any assessment, however it created the need for detailed written Points and Replies.
The biggest change was, in my view, the removal of Legal Aid in most cases and the “replacement” being Conditional Fee Agreements. The introduction of a Success Fee and After the Event insurance was not clearly thought through and Claimant solicitors were not attracted to a scheme whereby the “additional liabilities” would come from the client’s damages and in the astonishing decision to change the rules to provide for recovery of the additional liabilities from the losing side (invariably the Defendant). This led to the so called costs wars with Defendants using every conceivable argument to reduce, if not disallow success fees and ATE insurance premiums. The decision to allow the additional liabilities against the loser appeared to be made overnight with little, if any, consultation. We are still seeing the effects of this decision years after the recovery of the additional liabilities between the parties was abolished.
The changes did lead to the fledging Association of Law Costs Draftsmen growing in stature and reputation and Costs Draftsmen recognising the need to share information, to continue in development and the need to become professional in its approach and future growth. It was a proud day when we received the right to attend court in our own right as a recognised professional body rather than as a temporary employee of a solicitor.
The growth of the ALCD took many years under the chairmanship of many dedicated individuals and hard working voluntary committees and sub-committees. Qualification by examination was necessary replacing the previous interview process and the course work developed for new costs draftsmen was of degree standard.
The next move was to evolve from Costs Draftsmen to Costs Lawyers and the ACL continues to develop the role of its membership playing an active role in the development of costs rules and directions.
- What is a costs lawyer’s traditional role, and to what extent have costs lawyers now moved beyond this?
We were known as Costs Draftsman and as the name suggests our role was to prepare (draft) Bills of Costs.
Our knowledge was sought when opposing Bills and Costs Draftsman would attend Taxations then Detailed Assessments either with fee earners or as the fee earner’s “agent” and over the decades, as costs became significantly more complex, the role of the Costs Draftsman and now Costs Lawyers evolved to a hybrid of experts/advocates.
Dependant on the nature of the client, time is divided between the drafting of detailed schedules of costs/Bills of Costs or advising on claims presented and providing points of Dispute. The preparation of Costs Budgets (or advising and commenting on budgets received) led to an increase of our involvement in costs matters before the case was resolved and many Costs Draftsmen/Costs Lawyers regularly attended (and continue to attend) Costs Management Hearings.
The requirement to be on top of case law has become a necessity for all costs practioners; when I set out there were one or two cases quoted on taxations; nowadays there are several cases that impact on costs decided each week and such is the complexity of the decisions being made many Barristers began to specialise in costs matters many years ago and there are a number of Silks with costs specialisms.
- What are the biggest challenges currently being faced by the costs profession? How has the profession been affected by the Jackson reforms?
Fixed costs, or at least the threat thereof on much larger cases, will impact the profession like no other change before; it is a terrible idea, as a costs professional I would be expected to say that but anyone who stands back must see that applying fixed costs in, for example, complex life altering personal injury claims and/or clinical negligence matters will further erode an individual’s access to justice unless, which I suggest is unlikely, the costs are fixed at such a level that Claimant solicitors can afford to dedicate the necessary resources and time to present such claims. What concerns me is that there has been no study of how the Jackson Reforms are having an impact on costs recovery, as we are now only seeing cases concluded with CFAs entered into after April 2013 where the additional liabilities are no longer recoverable (save for modest ATE premiums to cover experts); the removal of the recoverable additional liabilities must represent a substantial saving for the Defendants including Insurers and bodies such as the NHSLA and MDU and the like.
Case budgets are only now concluding with the issue of costs to be considered and there is little guidance as to how such phased costs are assessed.
The rush to introduce fixed fees appears, to me, to be a knee jerk reaction to the less than favourable reception given to the Jackson reforms.
I suggest it is time to let the new guidance for budgets take effect and for the benefit of the removal of success fees and ATE premiums to be felt by those paying costs.
Evolution rather than revolution is a much more considered approach, as evidenced by budgeting which with some tweaks and co-operation is evolving into a useful costs management tool.
- What does the future hold for costs lawyers?
Significant changes and the need to evolve with any changes introduced; fixed costs will, without a shadow of a doubt, have a significant impact, if introduced, on a large number of costs professionals; we draw bills, advise on claims and prepare points, replies and offer advocacy services – the introduction of fixed fees will remove the need for many of our services in a large number of cases – that said the costs profession is resilient and the thousands of men and women involved with costs are more than capable of meeting the changes head on should the need arise; there will always be costs disputes in one guise or another.
- Any further thoughts or observations?
Many more capable and brighter people than me will consider the changes; I hope that there will always be a place for common sense in future developments and I would caution against the current trend to save costs without any consideration of the impact on all professions effected and more importantly on the impact on injured parties seeking justice where they have been wronged; change should not be resisted unless it is change for change sake and also if the only goal is to reduce costs to the detriment of many.
