MP: The Ministry of Justice is today publishing its
consultation response on extending fixed recoverable costs (FRC)
in civil law cases in England and Wales (attached). This follows
the 2019 consultation paper, Extending Fixed Recoverable Costs in
Civil Cases: Implementing Sir Rupert Jackson’s Proposals, which
was based on the recommendations in Sir Rupert Jackson’s report
on FRC, published on 31 July 2017. This consultation response has
been delayed, principally because of the COVID-19 pandemic.
As we build back a better justice system, we continue with
renewed vigour to modernise the courts and how users interact
with them. One area in need of further reform is costs, and
particularly those that a losing party must pay the winner. This
is especially true in lower value civil claims which people and
businesses are most likely to face, either as claimants or
defendants. Currently, the costs of these cases are too
uncertain. Without being able to predict what the costs may be,
it is difficult for either side to take an informed decision on
the best way forward. We want cases to be resolved as early as
possible, including those that proceed to litigation, with costs
that are certain, proportionate, and fair to both sides.
FRC are a way of controlling the legal costs of civil litigation
in advance by prescribing the amount of money that can be
recovered by the winning party at set stages of litigation. They
reduce overall costs, keep them proportionate, and enhance access
to justice. FRC are already an important part of our justice
system in lower value personal injury cases: their extension will
be of particular benefit to those of more modest means, including
individuals and small and medium enterprises (SMEs), and those
who may otherwise be unable to litigate.
The Ministry of Justice has carefully considered the way forward
in the light of responses to the consultation and developments
since, including the Government’s desire to extend the use of FRC
in other cases not covered in this response, such as clinical
negligence claims and immigration and asylum judicial reviews. As
is set out in our response, we propose to extend FRC to all cases
in the fast track (i.e. generally those up to a value of
£25,000), and to implement a new regime for ‘intermediate’ cases
(simpler cases between £25,000 and £100,000). We will work with
the Civil Procedure Rule Committee to ensure the smooth delivery
of these reforms, to be implemented over the coming year.
The case for extending FRC remains strong: uncertainty of costs
hinders access to justice, whereas certainty of costs set at a
proportionate and fair level enhances it.
