Important changes to cost budgeting were implemented on 6 April 2016 by the Civil Procedure (Amendment) Rules 2016, together with the accompanying document which sets out Practice Direction changes. All the changes apply only to proceedings issued on or after 6 April 2016.

Timing for filing of budgets

The timing for the filing of the costs budget changes (CPR 3.13(1)):

  • For lower value claims, up to £50,000, the budget must be filed with the Directions Questionnaire.
  • For all other claims it must be filed 21 days before the case management conference.

Budget Discussion Reports

Parties must file an agreed budget discussion report no later than 7 days before the first case management conference (CPR 3.13). Parties are also encouraged to use the Precedent R annexed to the revised PD 3E. PD 3E sets out what should be contained in the budget discussion report:

  • Figures which are agreed and not agreed for each phase;
  • A brief summary of the grounds of dispute.

Revisions to Precedent H

If the value of the claim is under £50,000, or the costs do not exceed £25,000, only the front page of the Precedent H (costs budget) needs to be exchanged. (PD3E 6b).

Assessment of costs

It is now a requirement to provide the court with a breakdown of the costs claimed in each stage of the proceedings when the court is assessing costs at the end of a case (before any detailed assessment proceedings are commenced).

Application of costs management

There are also new provisions excluding from cost management/budgeting claims made on behalf of a child, or where the claimant has a limited or severely impaired life expectancy. (CPR3.12(1)(c) and PD 3E)).

How will the changes affect cost budgeting?

  1. The date when a costs budget is to be filed is now certain – It was not clear under the old rules. 
  2. Parties must now attempt to agree the new Precedent R (budget discussion report) and file it 7 days before the first case management conference. If figures cannot be agreed that must be set out in the report. (CPR 3.13). 
  3. The court will not look at the detail in the budget, only the hourly figure. (PD3E 7.10)