Court of Appeal clarifies certain issues relating to costs budgeting

The Court of Appeal clarified certain issues concerning the relationship between costs budgeting and detailed assessment at the end of a case:

(1) The aims of costs budgeting include a reduction in detailed assessments and so a good reason is needed to depart from the costs budget and this includes a good reason to go below the budgeted amount.

(2) However, there is no need to show a good reason to depart from the amount of costs incurred prior to the budget: such incurred costs were never agreed or "approved" by the Costs Management Order and so they are to be the subject of detailed assessment in the usual way.

Separately, the Court of Appeal also confirmed that a case is "commenced" for the purpose of the new proportionality rules which came into force on 1 April 2013 (see CPR r44.3(7)(a)) on the date entered by the court on the claim form. Although the rule refers to "cases" commenced before 1 April 2013, that did not mean something different from "proceedings" or "claims".